Posts Tagged ‘GSE bailout’

Fannie, Freddie “Mother of all Bailouts” may cost Taxpayers $1 Trillion

Fannie, Freddie "Mother of all Bailouts" may cost Taxpayers $1 Trillion

Courtesy of Mish 

The estimated taxpayer costs of the GSE bailouts grows by the day and has now hit as much as $1 trillion.

Please consider Fannie-Freddie Fix at $160 Billion With $1 Trillion Worst Case.

The cost of fixing Fannie Mae and Freddie Mac, the mortgage companies that last year bought or guaranteed three-quarters of all U.S. home loans, will be at least $160 billion and could grow to as much as $1 trillion after the biggest bailout in American history.

“It is the mother of all bailouts,” said Edward Pinto, a former chief credit officer at Fannie Mae, who is now a consultant to the mortgage-finance industry.

The Congressional Budget Office calculated in August 2009 that the companies would need $389 billion in federal subsidies through 2019, based on assumptions about delinquency rates of loans in their securities pools. The White House’s Office of Management and Budget estimated in February that aid could total as little as $160 billion if the economy strengthens.

If housing prices drop further, the companies may need more. Barclays Capital Inc. analysts put the price tag as high as $500 billion in a December report on mortgage-backed securities, assuming home prices decline another 20 percent and default rates triple.

Sean Egan, president of Egan-Jones Ratings Co. in Haverford, Pennsylvania, said that a 20 percent loss on the companies’ loans and guarantees, along the lines of other large market players such as Countrywide Financial Corp., now owned by Bank of America Corp., could cause even more damage.

“One trillion dollars is a reasonable worst-case scenario for the companies,” said Egan, whose firm warned customers away from municipal bond insurers in 2002 and downgraded Enron Corp. a month before its 2001 collapse.

Foreign governments, including China’s and Japan’s, hold $908 billion of [Fannie and Freddie] bonds, according to Fed data.

“Do we really want to go to the central bank of China and say, ‘Tough luck, boys’?

The terms of the 2008 Treasury bailout create further complications. Fannie and Freddie are required to pay a 10 percent annual dividend on the shares owned by taxpayers. So far, they owe $14.5 billion, more than the companies reported in income in their most profitable years.

“It’s like a debt trap,” said Qumber Hassan, a mortgage strategist at Credit Suisse Group AG in


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Phil's Favorites

Big Tech's rejection of Parler shuts down a site favored by Trump supporters - and used by participants in the US Capitol insurrection

 

Big Tech's rejection of Parler shuts down a site favored by Trump supporters – and used by participants in the US Capitol insurrection

Parler is similar to Twitter but doesn’t control or discourage hate speech or calls to violence. OLIVIER DOULIERY/AFP via Getty Image

Courtesy of Alex Newhouse, Middlebury Institute of International Studies

Early in the morning of Jan. 11, the social media platform Parler went offline after Amazon ...



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Zero Hedge

Not As Green As You Think - Global EV Push Sparks Cobalt Chaos

Courtesy of ZeroHedge View original post here.

Global cobalt prices per metric ton are up more than 20% since the beginning of this year as increasing electric vehicle demand has strained global supply chains. 

WSJ spoke with auto and battery experts about cobalt, a metal found in lithium-ion batteries. Besides EVs, the blue metal is found in virtually every consumer electro...



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Politics

Far-right groups move to messaging apps as tech companies crack down on extremist social media

 

Far-right groups move to messaging apps as tech companies crack down on extremist social media

Far-right groups like the Proud Boys, seen here marching in Washington, D.C., on Dec. 12, are increasingly organizing their activities on messaging services like Telegram. Stephanie Keith/Getty Images

Courtesy of Kevin GrishamCalifornia State University San Bernardino

Right-wing extremists called for open revolt against the U.S. government ...



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Kimble Charting Solutions

Bitcoin Parabolic Rally Reversal Faces Big Support Test!

Courtesy of Chris Kimble

One of the biggest breakouts of 2020 came by way of Bitcoin. And it was epic.

The coronavirus crash saw the cryptocurrency retest its 2018 lows before rocketing higher in parabolic fashion.

Did Bitcoin Peak? What’s Next?

Today we examine a “weekly” chart of Bitcoin, highlighting its parabolic rally… and recent reversal lower.

The rally in Bitcoin surged all the way to the 361% Fibonacci extension level at (1) before creating the largest bearish reversal in years.

In just a few weeks time, Bitcoin is testing its 261% Fibonacci level near 31,000 at (2). This is a big test of support for the cryptocurrency. A “weekl...



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ValueWalk

Hybrid Electric Vehicles: A Stay of Execution for NiMH Batteries

By Jacob Wolinsky. Originally published at ValueWalk.

Hybrid Electric Vehicles: A Stay of Execution for NiMH Batteries, Explores IDTechEx

Q4 2020 hedge fund letters, conferences and more

NiMH Batteries Are Still Commonly Used

When we talk about battery-electric vehicles, the lithium-ion battery is dominant; however, for full hybrid electric vehicles (those that have electric-only modes but do not plug-in), NiMH batteries are still the most common battery on the road. With the growing market for hybrid electric vehicles (HEVs), will this drive further demand for NiMH batteries and stop them from being eliminated from the automotive market?...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker

Please review a collection of WWW browsing results. The information here is delayed by a few months, members get the most recent content.



Date Found: Saturday, 11 July 2020, 05:26:16 PM

Click for popup. Clear your browser cache if image is not showing.


Comment: This is lack of liquidity means support is likely to break if it is tested hard!



Date Found: Saturday, 11 July 2020, 09:51:58 PM

Click for popup. Clear your browser cache if image is not showing.


Comment: Nasdaq losing momentum.



Da...

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Biotech/COVID-19

The simple reason West Virginia leads the nation in vaccinating nursing home residents

 

The simple reason West Virginia leads the nation in vaccinating nursing home residents

By mid-January, only about a quarter of the COVID-19 vaccines distributed for U.S. nursing homes through the federal program had reached people’s arms. Paul Bersebach/MediaNews Group/Orange County Register via Getty Images

Courtesy of Tinglong Dai, Johns Hopkins University School of Nursing

The urgency of vaccinating nursing home residents is evident in the numbers. The COVID-19 pandemic has claimed the lives of mo...



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Mapping The Market

The Countries With The Most COVID-19 Cases

 

The Countries With The Most COVID-19 Cases

By Martin Armstrong, Statista, Jan 12, 2021

This regularly updated infographic keeps track of the countries with the most confirmed Covid-19 cases. The United States is still at the top of the list, with a total now exceeding the 22 million mark, according to Johns Hopkins University figures. The total global figure is now over 85 million, while there have been more than 1.9 million deaths.

You will find more infographics at ...



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Digital Currencies

Bitcoin: why the price has exploded - and where it goes from here

 

Bitcoin: why the price has exploded – and where it goes from here

B is for blast-off (but also bubble). 3DJustincase

Courtesy of Andrew Urquhart, University of Reading

Bitcoin achieved a remarkable rise in 2020 in spite of many things that would normally make investors wary, including US-China tensions, Brexit and, of course, an international pandemic. From a year-low on the daily charts of US$4,748 (£3,490) in the middle of March as pandemic fears took hold, bitcoin rose to ju...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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