Ohh, you know you love it, otherwise you would have come in here with something with a little more substance than some field chaff and cow cud.
Ohh, you know you love it, otherwise you would have come in here with something with a little more substance than some field chaff and cow cud.
Ohh cool, a ProSup from 2007. Do you even know what a Master Trust is or how securitization Master Trusts work? Nah, I'm sure you don't even know what a waterfall is.
What year is it? What series of bonds is the Fed buying? Is F/F not in conservatorship of the US Government? Does the Treasury not own more than 80% of the GSEs?
Hey, nice WayBack machine though, is Marty McFly and Doc Brown in there with you?
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bamacre
Lifer
- Jul 1, 2004
- 21,030
- 2
- 61
It's all he can do. Try to belittle others in order to make their stance look inferior. Oh, and the fear mongering, which we should all be aware of by now.
Whenever LK posts concerning economics, we all should remember that he's a high-level executive at a major financial institution. Not trying to imply he should be ignored, but IMO, people aught to take caution to his stance, that's all.
The neutering of this bill is a loss for the American people. Well, most of them.
I always love how you try to maximize my roll to minimize my arguments. It's a little funny.
I'm a VP at a bank. Do you know how many VPs there are?
But besides that, before I was at a bank, I spent 5 years educating myself in finance and economics, first with an MBA and then my CFA charter.
Yet you try to belittle me with your 10 minute YouTube education and bullshit theories.
Why don't you refute what I posted, fuckstick, instead of attacking me. Why, you can't refute what I posted because you don't have a shred of intelligence to understand even the most basic concepts of finance or economics, other than the cud you chew and spew from your remote operators.
GeezerMan
Platinum Member
- Jan 28, 2005
- 2,145
- 26
- 91
LK is right the Fed is already audited.....BUT...it's not a complete audit.
http://blogs.wsj.com/economics/2009/08/31/what-would-a-federal-reserve-audit-show/
http://blogs.wsj.com/economics/2009/08/31/what-would-a-federal-reserve-audit-show/
Wow, welcome to about a 6 months ago. I already know that and acknowledge it. I've already said that I am OK Congress doing a full audit of the carve-outs for the GAO, provided it isn't done by the GAO in a public audit.
Gosh, what would I have done without your valuable input...
xj0hnx
Diamond Member
- Dec 18, 2007
- 9,262
- 3
- 76
Bet you haven't seen me rail against my own industry, eh?
Yes, the populist/ignorant rant against anybody associated with a certain group. It's akin to racism.
What exactly is your profession? I bet it's been 100% clean throughout human history.
I do like how, much like bamacre and his ilk, you still avoid my points and attack me. Must be nice to know nothing at all yet still attempt to fight back in this manner.
Karl Denninger lays it out much better than I could. Please, refute this with actual law (like when you entered this thread). http://market-ticker.denninger.net/archives/1500-Bernanke-Gives-Finger-To-The-Law-Again.html
Fannie is a private corporation, proof provided. Their securities are not backed by the full faith and credit of the US, proof provided. The Fed did in fact purchase those securities from a private corporation, with no "faith and credit guarantee", proof provided.
bamacre
Lifer
- Jul 1, 2004
- 21,030
- 2
- 61
Ohhh, you don't like getting a taste of your own medicine?
We'll all cry and pray for you and the rest of the bank executives.
I already showed you that F/F have effectively become government institutions. They are in government conservatorship, the GSE bonds are trading at treasury levels, and everybody knows they have an unlimited lifeline to the government if things go bad, sounds to me like the "full faith and credit". Furthermore, the series you pointed out was issued in 2007, not 2008 or 2009, after F/F were effectively taken over by the government and an unlimited lifeline was issued.
I don't give a flying fuck through a rolling doughnut what Denninger says. The guy is a moron and has proven that many times, for example, through his repeated drum beats for the collapse of US society.
As found here:
http://www.newyorkfed.org/markets/mbs_faq.html
Their legal justification for the pruchases is 14b, under Board of Directors carve out. Specifically, clause 2 allows them to purchase "To buy and sell in the open market, under the direction and regulations of the Federal Open Market Committee, any obligation which is a direct obligation of, or fully guaranteed as to principal and interest by, any agency of the United States."
Since the GSEs are now agencies of the government, under government conservatorship, then clause 2 works.
Sorry chuck, you and your blowjobbery of denninger lose.
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Taste of my own medicine? How's that? That I refute your arguments point by point and drop scorn on you for being nothing but a cud chewing cow who doesn't have a shred of logic, because I can do what I can do?
Yet, you come back and never attack points, nor drop scorn because my logic and points aren't sound. You merely attack like a rabid dog backed into a corner because you've got nothing at all.
Our medicines are different. Perhaps somebody who is a "forum director" should act a bit differently.
I have a few minutes of free time so I figured I would post the relevent information in case you're to lazy to read it.
Fannie is a private orginization per USC Title 12, Chapter 13, SubIII Sec 1716b. To further illustrate my point, here is a link to their stock, being that you are a bank VP I assume you have an account in which you can purchase stock so why don't you go ahead and purchase a single share. Its only a buck so it won't put you out much either and then come back and try to explain that it is in fact a government agency whose paper carries the full faith and credit of the United States. The Treasury can, and has, purchase all the Fannie paper it wants (as long as Congress doesn't get in the way) and it can fund that purchase by having the Fed monetize more debt errr I mean quantitative easing but once again, what legal authority does the Fed have to directly purchase Fannie securities?
Oh but wait, since 2007 is getting in my wayback machine with Marty Mcfly and Doc Brown, how about a direct link to Fannies website with their debt offering circular dated April 10,2009. Go ahead, click on the pdf and would you like to tell the class what the big bold print on the very first page says? Please mister Vice President of a bank could you explain why it would say that if exactly the opposite was somehow true?
Master trusts and all that other crap is just that, crap. We are talking about black letter law . Congress is perfectly able to change that law if they see fit but as it stands now there are very specific requirements that must be met in order for the Fed to purchase something.
Need proof of what was purchased? You got it... link
I think I have satisfied all of your questions, hopefully you will reply with some actual law that refutes what I am arguing this time. Off topic a bit, does the bank that you work for run as lose with the law as you are trying to argue the Fed do? While I don't know what bank you work for, just a bit of caution, us normal folk go to jail for violating black letter law and from what I can tell this ain't even a "gray area".
Again, you're ignoring that they are in the conservatorship of the US government. They were taken over by the government. Do you not get that?
http://www.nytimes.com/2009/10/09/business/economy/09loan.html
http://www.nytimes.com/2008/09/08/business/08fannie.html?_r=1
To quote specifically: "It also eliminates dividend payments to current shareholders while protecting the principal and interest payments on the debt, now held by foreign central banks, financial institutions, pensions funds and others."
You can google "Agency RMBS" and GSE debt is known as such, since they are quasi-government entities. The "legal disclaimer" (your BLACK LETTER LAW) is there because the government does not have an explicit guaranty. However, the market knows it is implicit, as the government has shown.
If you think they are in violation, file a lawsuit and see if it sticks. Otherwise, your faux calls of illegal activity are bunk. The Fed believes they are operating within the law, you haven't proved they aren't, and nobody has sued them. If Denninger really wanted to make a difference, why hasn't he sued them? His conviction is smaller than his wallet, or the other way around?
So much for your BLACK LETTER LAW. Law is up to interpretation and understanding. You, in fact, have poor understanding and even worse interpretation. You're blind to the whole outlook.
If there's one thing I've learned in my years of securitization experience, you need to make sure you circle up every piece of information before making a conclusion. Obviously you haven't.
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You know what I bet would help prove they are in fact breaking the law? Hmm, how about an AUDIT? Which is exactly the point of this thread but evidently a congressman who coincidentally has ties to BOA has gutted the bill. I wonder why BOA would be so interested, its not like the Fed can legally hold any of their securities either.
BTW, since when does "the market knows its implicit" override actual law? You admitted the government doesn't explicitly guarantee Frannie paper as required by actual law for the Fed to purchase but hey, who cares about silly laws (as long as everyone knows they are being broken), right?
As far as interpretation, here is the million dollar question, why do you suppose the law states anything the Fed purchases must have the "full faith and credit" requirement? Could it possibly be to protect the US taxpayers from the Fed making "bad investments" that the tax payers must cover, investments that could be made without any congressional approval? Are you implying that the Fed has the power to lose trillions of dollars with zero congressional approval or even knowledge? Who pays the tab if those securities are worth 0 when they mature?
I have provided all the documentation you have asked for, including proof of what/when the Fed purchased, the actual law that defines Fannie as a private company that you or I can currently purchase stock in, proof that Fannie paper does not have full faith and credit of the US, and your retort is simply everyone knows its happening and "conservatorship" (which is not nationalization). Could you please tell me which law states that any private company currently in "conservatorship" debt is guaranteed by the full faith and credit of the US? Or are you trying to argue that a company that I can currently purchase stock in is an agency of the United States? How many other US agencies can I legally own?
Hey, maybe I am wrong and if you show me the law that says either of the above I will gladly admit it. I'll even paypal you the money to purchase 5 shares of Fannie
(if their debt has the full faith and credit of the US government how can ya lose, right?).But I haven't seen anything like that. What I have seen is the Fed and a few elected officials fighting like crazy to prevent an audit which would definitely prove one of us wrong.
That's the new one you posted, not the old one previously posted.
As it currently stands, the GSEs are pre-paying the mortgages out of the trust, sustaining the losses on balance sheet, which is why Fannie requested another 15bn from the Treasury.
Sounds like support to me.
As for your previous post, clause 2 does not require "full faith and credit of the US Government" it requires the P&I to be guarantied by the "agency", since the GSEs are considered agencies (and are government sponsored entities with USG conservatorship and complete government control), then clause 2 works.
Furthermore, your silly argument of buying a GSE stock, proving that they are private, is silly. The stock has become effectively worthless because the Treasury's holding of GSE preferred shares effectively wiped out common stock holders, which is the exact reason why the shares are trading at the levels they are (and, IMHO, too high for their intrinsic value).
Your argument that a full audit is needed to discover the "truth" is fucking laughable. I mean, really, you're claiming that it's all out in the open, you think you have tons of proof, you have the FOM movements/purchases, and the FRA clauses, along with your "proof" that the GSEs sell ineligible assets to the Fed, yet with all of that ****PUBLIC**** information, NOT A SINGLE PERSON HAS SUED THE FED.
Sounds to me like you think you have a open and shut case, all with public info that "clearly" shows your case. Right?
The audit is for other purposes not already disclosed (unlike your "proof").
Nice try though. It was a good dodge and hustle.
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Chunkee
Lifer
- Jul 28, 2002
- 10,391
- 1
- 81
I love how you spew, wallow and chug your own gravy. Breaking a stick in two over your head is damn easy task. I bet your office is full of mirrors.
It's ok, I know you and your fellow cohorts lose on every legal, economics, and finance argument you've been able (or unable) to bring. It must be frustrating to have your YouTube diploma shot down so much, especially since you try so hard at chewing another cow's cud.
They do make drugs for such utter failure.
First of all, I am not trying to "dodge and hustle" anyone. I have admitted and will again readily admit I am not a lawyer nor am I an expert at any of this. I don't even have a youtube diploma that you like to insult people with. Nor is my intent to throw around insults on an internet message board. I am not a fanboy of either major party and I am not a Paulbot. With that said, I pay enough attention and I am smart enough to figure out that there are a lot of fucked up activities currently taking place in our markets. Just about everyone believes there is blatant insider trading going on yet no investigations. People, such as Bernake, perjuring themselves at congressional hearings. Bullshit numbers from the government as well as a complete disregard to the law of exponents. As far as me suing the Fed, give me a break. Congress can't get them to open their books but my dumbass is going to win a suit against them?
I have satisfied all of your previous requests for proof on the subject at hand and we are left disagreeing on what makes an entity an agency of the government. As I said earlier, maybe I am wrong wouldn't be the first time and if you provide me with the actual law that states that a private corporation (by congressional bill no less) that is supported by the government is now an agency of the government I will happily admit that you are right. Either way, I have enjoyed the debate and know a bit more than I started out.
On to more fun:
Lets for a moment assume you are right, why exactly is the Fed buying Fannies paper and not the Treasury? The Fed is already funding the Treasury (at least partially) who then funds Fannie's pre-payment of the securities who then sells that security to the Fed... Did I get that right?
Could you perhaps explain the "pre-payment" part in a little more detail? Are you saying the paper the Fed holds can not possibly be worth less than purchase price? If that is the case, why can't they sell it into the market? If it can devalue for whatever reason and for the sake of the debate the Treasury cuts them off, who eats the loss? I don't have the slightest idea what a mortgage backed security is (and I am a bit lazy atm), but if it is what it sounds like, how are the mortgages valued?
Pretty much. Watt, "Hmm, Mr. Pauls bill sounds great. Though if we let it go through now it will shed light on how the Dems who have controlled Congress are actually the ones that fucked over America, not Bush because he's the President and he doesn't introduce or vote on laws. We have to wait a while then re-introduce the bill as the 'How GWB fucked America in the Banking Sector Bill' and we can lay the blame on him and the Republican right around next election cycle."
BoberFett
Lifer
- Oct 9, 1999
- 37,563
- 9
- 81
bamacre
Lifer
- Jul 1, 2004
- 21,030
- 2
- 61
No matter how often I do, you always claim otherwise. So, why should I bother when you'll just continue to make your false claim? And it is a false claim. And beyond that, why should I bother when you and I will never agree anyway? I often have more important things to tend to.
What's false about what I posted? Again, you provide nothing. Refute it, point by point.
I'll get to Darwin's post later. It's my wife's 30th birthday, so I have limited time.
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