Obama desperately wants to use your tax dollars to write-off the mortgages of his deadbeat voters. One guy in Washington D.C. is telling him to go fuck himself. People like Ed De Marco are few and far between in Washington. The politicians prefer spineless yes men. Fannie and Freddie are 80% owned by you. They have lost $200 billion of your money since 2008. These losses do not show up in the deficit figures or the national debt figures. It’s a way for Obama to give it to you in the backdoor. Obama and the Democrats know that thinking is hard and their voting block doesn’t give a fuck about a few hundred billion more losses on the backs of the tax paying middle class.
On Eddie D.
Submitted by Bruce Krastingon 08/04/2012 11:37 -0400
Edward De Marco is the acting head of the FHFA. He is responsible for what happens at Fannie and Freddie. A lot of people hate this guy and want to see him sacked. I like him. I think he is one a few people in D.C. who actually gives a damn about taxpayer losses at the mortgage agencies.
As per usual in America, this is a matter between left and right. Democrats hate De Marco. The Republicans are standing behind him.
The latest saga in this love-hate story is a letter that De Marco wrote to Senators Richard Shelby (R -TN) and Tim Johnson (D – SD). (Link) The issue is whether Fan and Fred should write down the principal on mortgages they own. De Marco said flat, “no”. The following is the critical sentence. Note that De Marco uses “I” when he says who made the decision. I give him an “A” for putting his head on the line.
I have concluded that Fannie Mae and Freddie Mac’s adoption of HAM PPRA would not make a meaningful improvement in reducing foreclosures in a cost effective way for taxpayers.
I think this is a pretty simple issue. What is De Marco’s Congressional mandate?
conserve the assets and property of the regulated entity
There is more to the FHFA mandate, but it was the objective of the original legislation to minimize the risks to taxpayers. There is nothing in the laws that created FHFA after Fan and Fred blew up, that allows De Marco to use the former agencies as a tool of national economic policy.
There are valid arguments on both sides of the debt forgiveness debate. It there was a magic wand that could be waved, and all underwater mortgages were eliminated, it would have significant economic benefits. Unfortunately there are no magic wands, and there is no free money available to accomplish the write-downs.
Everyone in D.C. (including Obama) knows that there is no way in hell that Congress is going to come up with the loot necessary to achieve the mortgage forgiveness. But, as the law stands now, Congress/Treasury are forced to make up any losses at Fan and Fred.
So, in theory, if the Agencies went on a tear, and wrote down principle, they would suffer huge losses, and Congress would be obligated to cover those losses. No additional legislation would be required. Of course this would violate the terms of the 2008 laws that set up FHFA. Ed De Marco is standing in the way of the Administration’s desires.
Who are the folks who are pushing De Marco to provide debt relief? One group that is been particularly vocal on this issue is Rebuild The Dream.
This outfit is run by a fellow named Van Jones, who just happens to have worked for Obama as a Green jobs czar. I find it it interesting that Mr. Jones has gone from Green, to mortgages. Possibly he’s just a political hack, who does what he is told (and paid for).
Speaking of hacks, Paul Krugman has weighed in on this (Link). PK is desperate to spend some more government money. He would love to see another $400Bn go out the door, and just put the bill on the next few generations. His thoughts (Link) on De Marco’s career path:
Because De Marco is civil service, he can’t be kicked into the street, but that’s irrelevant — he can be put into an equivalent-salary job at the Small Animals Administration, or something.
.
Democrats in Congress have been calling for De Marco’s head for some time. Elija Cummings and Maxine Waters have been making poor Ed’s life miserable.
Other Democrats have chimed in on the recent decision (The Hill – Link)
Senate Majority Whip Dick Durbin (D-Ill.) blasted De Marco’s decision as “short-sighted” and an “abdication of his responsibility.”
Elijah Cummings and fellow Oversight member John Tierney (D-Mass.) have accused De Marco of withholding documents that would reveal the benefits of principal reductions.
The Administration is doing everything they can to lean on Eddie. Timmy Geithner was quick to respond:
“I do not believe it is the best decision for the country,” Treasury Secretary Timothy Geithner wrote in a letter to De Marco.
There are some Republicans who have stood behind De Marco. House Financial Services Committee Chairman Spencer Bachus (R-Ala.) said De Marco made the right call.
“The administration put incredible political pressure on Director De Marco, and he deserves praise for standing up for the best interests of the American people,”
In the end, De Marco has one very solid supporter, Senator Richard Shelby (R -TN). With Shelby backing De Marco, his job is safe for a few more months.
Mr. De Marco’s career as the head of the FHFA will come to an end with a week or so after the next election. If Obama is re-elected, he will fire De Marco and appoint someone who is friendly to a mortgage write-off, paid for with tax payer funded losses at the Agencies. Obama will do this in a recess appointment, and Congress will not have a say in the outcome.
There is so much riding on this election.
pelhamlegal says:
It makes no difference, but Senator Richard Shelby is the senior Senator from Alabama.
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4th August 2012 at 4:06 pm
Stan says:
Obama played golf today.
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4th August 2012 at 5:21 pm
ASW43 says:
Hidden due to low comment rating. Click here to see.
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4th August 2012 at 5:40 pm
printmemoney says:
Whether they write down the principle or not, we are on the hook for trillions of losses…..this may be the death knell of the dollar
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4th August 2012 at 5:42 pm
printmemoney says:
Asw43-I like the writing style….check out USA today’s website if it is too abrasive for you
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4th August 2012 at 5:46 pm
GimmeABreak says:
If you dont have the title it is the mortage holder (bank) that is being bailed out.
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4th August 2012 at 5:48 pm
Chicago999444 says:
Not to defend Obama or the Dems….. but where were the REPUBLICANS when Cheney said that “deficits don’t matter” and Bush and his team decided to drive the economy with debt creation and asset inflation, a.k.a. Bush’s “ownership society”?
During the years of the Great Housing Rampage, 2000-20006, I never heard one leading Republican warn that the house loans made were dangerously large in relationship to borrower’s incomes and that things like equity extractions to buy cars and boats and boob jobs, and IO and Pay Option ARMs were diabolical financial instruments designed to destroy the borrower, and that we were racking up debt many times what we could conceivably hope to repay.
Noooooooo. The Republicans applauded the rigged mortgages and insane leverage being layered up 10 stories high in the financial firms, and God Forbid anyone raise a voice or a hand to state that this was insane.
The very first bailouts, for AIG, were promulgated by Republicans. Hank Paulson, who should have been confronting Insider Trading charges, is a Republican.
The only reason the Republicans are opposed to writing down these mortgages, which I agree is insane and immoral, is because the pandering Dems want to do it. Do you really thing the Republicans would support withdrawing taxpayer support from Wall Street and letting the TBTF, fail?
Let’s just drop the party politics here. Both of our political parties are hopelessly corrupt, and criminally complicit in creating the rolling financial disaster that has destroyed our hopes of economic recovery.
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4th August 2012 at 5:54 pm
TeresaE says:
First, let’s call a spade a spade.
This isn’t a “gift” to deadbeat homeowners.
This is a gift to the banks and Freddie/Fannie.
Once you resign your mortgage, you obliterate the title issues that cloud it now.
Before refi, you have multitude of ways to get your property back from the thieving banks, ask MM.
After, you fixed their problem, the title – and mortgage – are now ironclad. Lose your job, delay paying, lose your house. Still overpriced, even with a 3% refi.
Silly Americans, still thinking there is truly any upside to anything coming out of WDC.
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4th August 2012 at 5:55 pm
Administrator says:
ASW43
“probably pays more in taxes every than you earn” – WTF are you trying to spit out?
What are you a mentally defective ignoramous? You’re proof that any mouth breathing trogladite can graduate from our public school system.
Being able to write the english language might give credibility to your assanine comment, but I doubt it.
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4th August 2012 at 5:59 pm
Administrator says:
I’m not playing party politics. I put the blame for the housing disaster on the culprits from both parties. Bush pushed his ownership society, backed by Greenspan’s low interest rates and look the other way regulation. Fannie & Freddie did their part, pushed by Barney Frank and Chris Dodd to make loans to anyone with a pulse. Wall Street scum included Rubin and Dimon – staunch Dems, along with plenty of Republicans.
But Obama is in charge now and has been for four years. He and Geithner have used Fannie, Freddie and the FHA to dole out more bad loans and take on losses that should be going to Wall Street banks.
De Marco is standing up to Democrats today. That isn’t politics. IT’S THE FACTS.
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4th August 2012 at 6:07 pm
efarmer says:
We haven’t had any cleavage on this thread yet. EF
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4th August 2012 at 6:45 pm
ASW43 says:
Hidden due to low comment rating. Click here to see.
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4th August 2012 at 6:45 pm
Administrator says:
ASW43
You are the gift that keeps on giving.
You attempt to trash me for my lack of intellect and you’re such a moron that you spell intellect wrong.
Thank you for representing the ignorant masses in such a fine manner.
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4th August 2012 at 6:52 pm
Colma Rising says:
ASW Foty Tree:
Did the flaky white stains wash out of your pillow?
My apologies, your stank-ass bottom-bitch moved before I could launch a jet of baby-batter on her face.
Normally I’m an ace but I just wasn’t all that into it….
Shit happens. My apologies.
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4th August 2012 at 7:15 pm
ASW43 says:
Hidden due to low comment rating. Click here to see.
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4th August 2012 at 7:23 pm
Administrator says:
ASW43
Here’s some advice for you:
It is better to remain silent and be thought a fool, than to open your mouth and remove all doubt.
Your analytical abilities are breathtaking to behold. My YTD visitor count is now 2.5 million.
Congratulations on making no spelling errors. Small steps.
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4th August 2012 at 7:31 pm
Colma Rising says:
Watch out though, he pays a lot of taxes…
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4th August 2012 at 8:27 pm
DaveL says:
“I’m sure you must be enjoying it too. it gives you something to do…”
Spelling improved, use of capital letters where required. Not so much.
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4th August 2012 at 8:33 pm
ASW43 says:
That was fun…
Thanks for playing along…
…and thank you for all the very well written, informative articles that you publish on your website. Please keep enlightening the masses….
Hot debate. What do you think?
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4th August 2012 at 9:45 pm
Llpoh says:
Damn, now I don’t know if AWS is an idiot or a newbie to be welcomed with open arms. If his last post isn’t meant sarcastically, then he is just the sort that fits in around here – capable of dropping a grenade into the Admin”s soup bowl.
AWS – if your last post was serious, welcome aboard. Otherwise, blow me.
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4th August 2012 at 10:10 pm
Colma Rising says:
Kinda thought the same after the last one.
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4th August 2012 at 10:43 pm
ASW43 says:
just fuckin with y’all..JQ is the man
…and…I never could spell worth shit!
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4th August 2012 at 11:54 pm
ASW43 says:
LIpoh
sorry…I’m in to women…but thanks for the offer!
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4th August 2012 at 12:00 am
dilligaf says:
well, chances are that Edward De Marco, is not a pedophile. otherwise they would be able to control him like the rest of the reprobates in d.c.
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4th August 2012 at 12:38 am
Mary Malone says:
TeresaE:”This is a gift to the banks and Freddie/Fannie. Once you resign your mortgage, you obliterate the title issues that cloud it now.”
1000% agree, this is nothing more than a gigantic bank bailout in the guise of a social justice program. The taxpayer,as Admin says is hit with the tab.
This is another example of Big Gov’s solution to the fraud – promote the cover-up.
All those government mortgage programs that refi underwater mortgages at 125% of home’s value are designed to get as many people out of the unsecured debt and place them into a loan that is secured by real property,
Everybody with a current mortgage that is “owned” by a trust, or MERS has unsecure debt. They don’t have a mortgage. They have a giant credit card balance that can be wiped out in chapter 13 bankruptcy. Or, the lien can be extinguished in a Quiet Title Action.
Remember, anything short of clearing your title is a scam, as TeresaE says.
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4th August 2012 at 5:04 am
Mary Malone says:
Attorney Tom Cox was interviewed by Mandelman, a foreclosure defense attorney. The podcast interview starts at the 6 min. mark.
Mr. Cox is the Maine attorney who uncovered what came to be known as robo-signing in 2010.
Today, he has news regarding GSE – owned loans. Fannie, Freddie and Ginnie do not foreclose in their own names. It’s spelled out in their 1100+ page guidelines.
Mr. Cox uncovered evidence that applies to about 20% of all GSE loans – a missing intervening assignment from originator to Fannie/Freddie/Ginnie is created, but not recorded.
But, the originator DOES create and record another assignment, which Mr. Cox has dubbed a decoy assignment. This assignment is created to fool the court into thinking that there was a real transfer of interest in the property to the TBTF who sues the homeowner for foreclosure.
It’s all a ruse. And in the end, the taxpayer is going to foot the bill.
Be sure to listen to the interview. All homeowners and their attorneys MUST demand the collateral file and ALL unrecorded assignments in discovery,
http://s3.amazonaws.com/iehi-video-mli/mandelman/Tom_Cox_on_the_Decoy_Assignment-3.mp3
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4th August 2012 at 6:40 am
ONE GUY WITH BALLS IN D.C. « The Burning Platform | House Foreclosure Credit says:
[...] taxpayers. I think this is a pretty simple issue. What is … … Read the original here: ONE GUY WITH BALLS IN D.C. « The Burning Platform ← Fixing Your Credit Made Easy.mp4 Kaufman Says US Foreclosure Prevention Falling Short [...]
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4th August 2012 at 8:42 am
Muck About says:
There is cleavage
and then there’s cleavage..
MA
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4th August 2012 at 9:12 pm