FANNIEGATE: The Big Short – The Saga Of Fannie Mae And Freddie Mac by Glen Bradford
Well, Peter was wrong when he was write. Right where you least expected to sing a song here he comes to save the day!
I just finished Peter J. Wallison’s AEI post in a response to what I just finished reading from the critically acclaimed Joshua Rosner’s response to Peter J. Wallison’s op-ed. Josh Rosner is right and Peter J. Wallison remains unwilling to review facts that have not been produced by sources from within the propaganda machine spewing misinformation. Over the last month I have had the privilege to exchange email correspondence with Mr. Wallison, but I must confess that I can’t tell the difference between someone who refuses to see the truth and someone who refuses to tell the truth. All I am trying to do here is demonstrate that the story where the GSEs are to blame is at best highly dependent on proverbial horse blinders contingent on the circle-jerk of TBTF Bank insiders quoting only their own people. In any experiment, if your sample size is purposely biased, so too will be the conclusions drawn.
I don’t understand what Peter is talking about when he talks right or left. What does that mean and how does it impact the illegal, unethical, and immoral actions taken behind the scenes to decapitate two Fortune 50 companies and dethrone equal opportunity affordable housing from the lives of Americans who still are said to believe in the American Dream? Ha, I pity the fools that find themselves reading this poor man article about why I’m going to make a million dollars in capital gains when there are other people who can just steal it from the rest of us like it was nothing and then parade around and blame poor people for making poor decisions and not taking into consideration that the government is out to get you if the Too Big To Fail banking syndicate decides that they are playing Monopoly and they just put hotels on Boardwalk and Park Place. Running the rest of us into the ground is not the answer here and that’s primarily why I support affordable housing which is the mission of Fannie Mae and Freddie Mac. Without their public mission who are we to say that we deserve home mortgage loans from the banks when we can’t even keep our property. First, civil forfeiture and now this.
So be it, but don’t act like you didn’t know that Fannie Mae was going to be profitable during the time when it was the most profitable company in the world’s history right when you brought out all the assets that you have been hiding in dark corners behind crevices in the balance where you were temporarily forgetting about them to play pretend like when you found them after telling us they weren’t there like we forgot that they were ours. Hilarious.
How many more times can Peter J. Wallison quote debunked research produced by Edward J. Pinto? The race is on, but landmark discoveries have been produced in the judicial system that undermine the likes of Peter J. Wallison, Better Markets, David H Stevens, and the public statements from US Treasury officials. In one instance, Mario Ugoletti who served at both the US Treasury and the Federal Housing Finance Agency wrote a sworn declaration under the penalty of perjury and then later during a deposition appears to have backtracked. Signing a carefully scripted document for court and answering questions about evidence that have been produced that demonstrate that at best your earlier statements were misleading is the behavior investors in Fannie Mae and Freddie Mac have come to expect from TBTF bank insiders masquerading as independent government officials.
There is a quote and a screenshot that I want to promote from the movie The Big Short that I think tie relevancy to the saga of Fannie Mae and Freddie Mac since they were bullied into a conservatorship that has been more of a deceivership than a receivership.
“I have a feeling that in a few years people are going to be doing what they always do when the economy tanks, they will be blaming immigrants and poor people.” – Steve Carell as Mark Baum
I find this quote to be relevant to the fact that the TBTF banking syndicate worked within the government to scape goat Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac were victims of TBTF mortgage fraud.
“The first sound they’ll hear is their heads hitting the floor.” – Hank Paulson.
In the Big Short, Michael Lewis makes it quite clear that the big banks were knee deep in the shenanigans of liar loans and that many people not limited but including mortgage brokers, ratings agencies, and private label mortgage backed securities underwriters were complicit in the ongoing fraud. And now my favorite screenshot from the movie:
$5,000,000,000,000 may seem like it doesn’t tie into anything but unsurprisingly that is just about the size of the combined asset base of Fannie Mae and Freddie Mac. In a race to the bottom, Goldman Sach’s Hank Paulson worked with Dan Jester to reconstruct the record.
“They’re not confessing. They’re Bragging.” – Rafe Spall and Hamish Linklater as Danny Moses and Porter Collins
Hank Paulson wrote it all out in his own book. The Senior Preferred Securities Purchase Agreement is unprecedented in United States history, but not world history. Foreign countries like Venezuela and Russia have in the past taken private property from their citizenry. In the United States, the Fifth Amendment to the Constitution protects Americans from the Government doing the same and there are dozens of lawsuits pending in courts around the nation fighting different aspects of government wrongdoing as it relates to the GSEs.
Since conservatorship has begun, the United States Treasury on a cash basis has subtracted over $100,000,000,000 from the GSEs through a series of transactions designed to cause a liquidity crisis predicated by accounting fiction. If the government regulator pretends that Fannie Mae and Freddie Mac assets are worthless, then perhaps they can circumvent the purpose behind the Fifth Amendment to the Constitution and take what you and I would have to pay for, but for free.
This is not unlike civil forfeiture. Fannie Mae and Freddie Mac were not the cause of the crisis. Forensic accounting reports suggest that Fannie Mae and Freddie Mac were more like Ford Motor Company than General Motors, where Ford Motor Company didn’t need a bailout and neither did Fannie Mae or Freddie Mac. The forensic accounting reports that have yet to find a single detractor can be found here: (1, 2, 3).
Through accounting and government trickery, the government has been able to take all of the money without any of the risk. If you’re going to nationalize a company in America, you have to take the good with the bad and absorb the liabilities and pay up.
As for me, I refuse to be overrun by the whispers of Peter J. Wallison and David H Stevens. The rule of law is not tired and old and you can run but you can’t hide. 11,292 documents, depositions and time are friends of the truth and the time left remaining where one can hide behind a web of lies is running out.