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Author: Douglas W. Elmendorf
Publisher: DIANE Publishing
ISBN: 143794017X
Category : Business & Economics
Languages : en
Pages : 8
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Book Description
This is a print on demand edition of a hard to find publication. Provides an estimate of the budgetary impact of the activities of Fannie Mae and Freddie Mac (two gov¿t.-sponsored enterprises, or GSEs, that provide credit guarantees for more than half of the residential mortgages in the U.S.). This report also discusses alternative budgetary treatments for the GSEs, describes the usefulness of alternative treatments, and explains the rationale for the use of fair-value subsidy estimates for the GSEs in its baseline budget projections. Those fair-value estimates deviate from FCRA-based estimates in an important way: By incorporating a market-based risk premium associated with the GSEs¿ credit guarantees, they reflect the fact that the government¿s assumption of financial risk is costly to taxpayers.
Author: Douglas W. Elmendorf
Publisher: DIANE Publishing
ISBN: 143794017X
Category : Business & Economics
Languages : en
Pages : 8
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Book Description
This is a print on demand edition of a hard to find publication. Provides an estimate of the budgetary impact of the activities of Fannie Mae and Freddie Mac (two gov¿t.-sponsored enterprises, or GSEs, that provide credit guarantees for more than half of the residential mortgages in the U.S.). This report also discusses alternative budgetary treatments for the GSEs, describes the usefulness of alternative treatments, and explains the rationale for the use of fair-value subsidy estimates for the GSEs in its baseline budget projections. Those fair-value estimates deviate from FCRA-based estimates in an important way: By incorporating a market-based risk premium associated with the GSEs¿ credit guarantees, they reflect the fact that the government¿s assumption of financial risk is costly to taxpayers.
Author: David Torregrosa
Publisher:
ISBN:
Category : Mortgages
Languages : en
Pages : 22
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Book Description
Author: Viral V. Acharya
Publisher: Princeton University Press
ISBN: 1400838096
Category : Business & Economics
Languages : en
Pages : 233
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Book Description
Why America's public-private mortgage giants threaten the world economy—and what to do about it The financial collapse of Fannie Mae and Freddie Mac in 2008 led to one of the most sweeping government interventions in private financial markets in history. The bailout has already cost American taxpayers close to $150 billion, and substantially more will be needed. The U.S. economy--and by extension, the global financial system--has a lot riding on Fannie and Freddie. They cannot fail, yet that is precisely what these mortgage giants are guaranteed to do. How can we limit the damage to our economy, and avoid making the same mistakes in the future? Guaranteed to Fail explains how poorly designed government guarantees for Fannie Mae and Freddie Mac led to the debacle of mortgage finance in the United States, weighs different reform proposals, and provides sensible, practical recommendations. Despite repeated calls for tougher action, Washington has expanded the scope of its guarantees to Fannie and Freddie, fueling more and more housing and mortgages all across the economy--and putting all of us at risk. This book unravels the dizzyingly immense, highly interconnected businesses of Fannie and Freddie. It proposes a unique model of reform that emphasizes public-private partnership, one that can serve as a blueprint for better organizing and managing government-sponsored enterprises like Fannie Mae and Freddie Mac. In doing so, Guaranteed to Fail strikes a cautionary note about excessive government intervention in markets.
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
Author: Harold L. Bunce
Publisher: DIANE Publishing
ISBN: 9780788137549
Category : Mortgage loans
Languages : en
Pages : 234
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Book Description
This report demonstrates that a significant proportion of prospective homeowners remains underserved by the mortgage finance industry. The report reviews and evaluates the framework of housing goals that has been established by Fannie Mae and Freddie Mac. It finds that the housing goals represent a promising approach to focusing their resources on the mortgage credit needs of homebuyers. Such a programmatic emphasis by these enterprises represents an appropriate exchange for the benefits that they receive through their ties with the Federal government.
Author: N. Eric Weiss
Publisher: Createspace Independent Pub
ISBN: 9781480151567
Category : Business & Economics
Languages : en
Pages : 28
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Book Description
The continuing conservatorship of Fannie Mae and Freddie Mac at a time of uncertainty in the housing, mortgage, and financial markets has raised doubts about the future of these enterprises, which are chartered by Congress as government-sponsored enterprises (GSEs) and whose debts are widely believed to be implicitly guaranteed by the federal government. In the second quarter of 2012, both Fannie Mae and Freddie Mac reported profits for the first time since the fourth quarter of 2006. Also, the second quarter of 2012 was first time that neither GSE had to request financial support from the Treasury. The Treasury has agreed to buy mortgage-backed securities (MBSs) from the GSEs and to raise funds for them. Initially, each GSE gave Treasury $1 billion in senior preferred stock and warrants to acquire, at nominal cost, 80% of each GSE. Treasury holds more than $187 billion of preferred stock in the two GSEs. Treasury has agreed to invest whatever is required to maintain GSE solvency through calendar year 2012. Now the formerly implicit guarantee is nearly explicit. In addition to Treasury's purchases of senior preferred stock, the Federal Reserve (Fed) has purchased GSE bonds and MBSs. Under terms of the federal government's purchase of their preferred stock, the enterprises are required to pay the government dividends of nearly $20 billion annually (10% of the support). Housing, mortgage, and even general financial markets remain in an unprecedented situation. Estimates of the total cost to the federal government use different baselines and vary widely. The FHFA estimates that Treasury is likely to purchase $220 billion-$311 billion of senior preferred stock by the end of 2014. The Congressional Budget Office estimates the budget cost to be more than $300 billion. Standard & Poor's has estimated the cost at $280 billion plus $405 billion to create a replacement system. Once Treasury's support for Fannie Mae and Freddie Mac ends, sometime after 2012, the GSEs will be challenged to pay the 10% annual cash dividend contained in their contracts. The enterprises could instead pay a 12% annual senior preferred stock dividend indefinitely. In August 2011, Standard & Poor's downgraded the debt of the federal government, Fannie Mae, and Freddie Mac. To date, there is no evidence that this has increased mortgage interest rates, but the impact may take longer to occur or to be detected.
Author: Oonagh McDonald
Publisher: A&C Black
ISBN: 1780935234
Category : Business & Economics
Languages : en
Pages : 494
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Book Description
The book demonstrates how politicians and federal agencies dominated Fannie Mae and Freddie Mac and took just thirteen years to wreck the American dream of home ownership.
Author: Deborah Lucas
Publisher: DIANE Publishing
ISBN: 1437986846
Category : Business & Economics
Languages : en
Pages : 30
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Book Description
Statement of Deborah Lucas, Assistant Dir. for Financial Analysis, Congressional Budget Office (CBO). Historically, support for the mortgage market has been part of a broader federal policy aimed at encouraging home ownership and, to a lesser extent, at making housing more affordable for low- and moderate-income families. The activities of Fannie Mae, Freddie Mac, and the Federal Housing Admin. (FHA) have been an important aspect of that policy. In 2010, Fannie Mae and Freddie Mac owned or guaranteed roughly half of all outstanding mortgages in the U.S., and they financed 63% of the new mortgages originated that year. Including the 23% of home loans insured by federal agencies such as FHA, about 86% of new mortgages made in 2010 carried a federal guarantee. However, the largest federal subsidiesfor home ownership have generally come from favorable tax treatment for housing. This testimony focuses on the CBO's estimates of the budgetary cost of the government's takeover and continuing operation of Fannie Mae and Freddie Mac. Lucas also discusses how the budgetary treatment of those two enterprises differs from that of FHA and other federal mortgage programs and the potential problems those inconsistencies cause, and summarizes alternative options for the future role of the federal government in the secondary mortgage market. Tables. This is a print on demand report.
Author:
Publisher:
ISBN:
Category : Capital budget
Languages : en
Pages : 48
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Book Description
And introduction -- Actions by the Federal Reserve to address the financial crisis -- The projected impact of the Federal Reserve's actions on the Federal Budget -- Estimates of fair-value subsidies from the Federal Reserve's actions -- Appendix A : Programs created by the Federal Reserve during the financial crisis -- Appendix B : CBO's fair-value methods.
Author: United States. Congress. House. Committee on Oversight and Government Reform
Publisher:
ISBN:
Category : Business & Economics
Languages : en
Pages : 356
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Book Description
