Menu

It’s A(n Awkward) Celebration!

Happy Birthday to you!

Happy Birthday to you!

Happy 2nd birthday, dear conservatorship!

Happy Birthday to you!

This month marks the second anniversary of the conservatorship being enacted by nameless bureaucrats tucked somewhere in U.S. Treasury headquarters. We hope you’ll forgive us for hoping that next year, we’re celebrating its end, and that discovery will actually name the aforementioned bureaucrats.  

On this auspicious day, we can’t help but imagine Jack Lew clutching a giant broom, smiling, as he sweeps up bills marked “Investor Dividends” that are flowing out of Fannie Mae and Freddie Mac. We couldn’t help but notice the irony of a press release issued by Fannie Mae this morning noting:

“[N]et income of $3.7 billion for the second quarter of 2014 and comprehensive income of $3.7 billion. The company reported a positive net worth of $6.1 billion as of June 30, 2014 and expects to pay $3.7 billion to Treasury in September 2014 as a dividend on the senior preferred stock.”

To put that into better perspective, with September’s dividend payment, Fannie will have paid a total of $130.5 billion in dividends to Treasury in comparison to $116.1 billion in draw requests since 2008.

On a press call this morning to discuss the earnings report, Housing Wire reporter Trey Garrison had a chance to ask Fannie Mae CEO Timothy Mayopoulos to comment on the fact that today is the second anniversary of the Third Amendment sweep being created. Garrison tweeted about the exchange afterwards:

“On the investor call, $FMCC CEO said he wasn’t aware it’s been 2 years since conservatorship swept away the rights of Freddie shareholders.”

So there you have it, folks! The CEO of Fannie Mae isn’t aware that for two years, investors in his company have been watching their legally and contractually owed dividends get swept up by the federal government.

And on that note, we’re looking for some unfortunate birthday cake. 

 

*Please note, this blog post has been edited.