Treasury and the FHFA not only acted “arbitrarily and capriciously” in executing the Third Amendment to the Preferred Stock Purchase Agreements with the GSEs, the agencies ignored “salient data,” including Fannie’s and Freddie’s tens of billions of dollars in deferred tax assets.

Fairholme still owns a ton of GSE stock. At press time Wednesday, Fannie common was trading at $4.77. The most Fairholme ever paid for Fannie common was $2.07. Sweet…

The “arm’s length transaction” policy of Fannie Mae and Freddie Mac prohibit property sales to non-profits that resell to the original homeowner.

Former Treasury official Jim Millstein argues that taxpayers “stand to make an enormous profit” if the two are allowed to recapitalize, restructure and eventually are sold to “back to private investors.”

If you take away all the one-time gains at Fannie Mae and Freddie Mac, the two are barely profitable. Right?

In order for the GSEs to exit conservatorship with the full faith and credit of the U.S., they would have to pay the Treasury a fee equal to the value of the government’s backing under the terms of their preferred stock purchase agreements.

Fannie Mae has traditionally reserved the right to invoke margin calls if it needs to.

Commercial banks and savings institutions held $1.521 trillion of single-family MBS in their retained portfolios as of the end of the first quarter of 2014, according to a new Inside MBS & ABS ranking and analysis of call report data. Bank and thrift MBS holdings were up a modest 1.0 percent from the previous quarter, but it marked the first increase since the third quarter of 2012, when the Federal Reserve began aggressively buying agency MBS and Treasury securities. Significantly, the increase in bank MBS holdings came at a time when new issuance was plummeting. MBS purchases...[Includes two data charts]

Building the new common securitization platform for Fannie Mae and Freddie Mac may be the easy part. Plugging in the two government-sponsored enterprises is another story. Through the end of last year, the two GSEs had spent about $65 million to build the CSP, according to a report by the Inspector General of the Federal Housing Finance Agency. The IG estimated that Fannie and Freddie this year are spending about $6 million a month to continue that work. In fact, neither the GSEs nor the FHFA have yet come up...

Fannie Mae and Freddie Mac cannot remain safely in conservatorship indefinitely, and they cannot get out from under Uncle Sam’s protection without “cataclysmic” consequences to the government-sponsored enterprises, MBS investors and the market, according to a new Urban Institute study. While the Federal Housing Finance Agency and the White House can make minor changes administratively, the UI paper notes it would take an act of Congress to authorize substantial revisions to the GSEs’ bailout agreement. “They can take...