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Where are the billions?

In the words of director Calabria, "Fannie Mae and Freddie Mac are and always have been private companies."

These companies had done a great job for decades and have paid hundreds of billions to the government during the past years while being highly profitable. Even the recent Covid-19 crisis did not hurt the twins - on the contrary. In international comparison, the American homeowners and homebuyers are in excellent position. In this context, and also with regard to the latest Dodd-Frank Act Stress Test, the capital demands appear completely arbitrary by exceeding DFAST by a multiple. Furthermore the business model of Fannie Mae and Freddie Mac is fundamentally different from that of commercial banks as deposit-based financial intermediaries. Unlike the banks, the twins do not bear any risks such as interest rate risks, credit risks and liquidity risks. For this reason alone, it makes absolutely no sense to mention Basel in the capital proposal at all. With these excessive capital requirements it will be unrealistic finding investors and for homebuyers it also will be much harder in the future. The consequences of this capital proposal have already been explained and substantiated in detail by countless economists in recent weeks. The reason to force an additional completely unnecessary slow down of the entire economy instead of getting things finally done and making affordable housing possible is not clear to me at all. But this excessive capital requirement is only one point in this unbelievable and bizarre story.

In recent years, all profits have been shamelessly skimmed off in order to misappropriate the confiscated billions of USD demonstrably for immature projects like Obamacare without leaving Fannie Mae and Freddie Mac the chance to build up capital to finally detach from an anyway questionable conservatorship. Where are all the overpaid billions? Who do those overpaid billions belong to? Were this involuntary gifts to the government over and over again every quarter or does this money belong to the private companies that generated it? Why are legally generated profits of private companies confiscated at all? And why the hell is it necessary to discuss whether stolen and misappropriated money should be returned or not? This delaying tactic has only one purpose: to continue to collect profits of private companies in the hope of never having to give it back - it has been so convenient and easy in recent years; why change anything? Stop this fraud, give back the overpaid billions to the companies as the rightful owners – and better yesterday than today because interests must be charged, as well as Frannie had to pay. In this way this intolerable zigzagpath has finaly an end and frannie get’s back to privatization where they belong.

It is obvious to everyone that these private companies have been illegally treated as cash cows for the government for years. Such practices are usually only known from highly corrupt, unstable governments and in medieval despotism and are in fact called forced confiscation. This fact contradicts any sense of justice. It contradicts any sense of justice that thousands of documents were kept under resolution for years and despite judicial decree still are. It contradicts any sense of justice that without a legal basis billions of dollars generated by private companies over many years disappear into an opaque swamp without adequately compensating the rightful owners of those highly profitable companies in any form. On the contrary: they were laughed at and oppressed for years and please remember: also shareholders are taxpayers. It also goes against all sense of justice that such a situation could be maintained with impunity for so long. Without exception, any private individual would have been lawfully stopped at the very beginning of this fraud and would undoubtedly face a long prison sentence.

Private companies traded on the stock market belong to the common shareholders and the top priority of the management is to represent their interests and keep the companies on the road of success. This cannot be achieved with an opaque and unrealistic capital proposal, accounting tricks, concealment and delaying tactics. Trillion dollar packages can be arranged in a cloak and dagger operation overnight but a fair and clean solution for the housing market is not in sight even after many years - if it wasn't so sad, you could laugh about it - it is crying shame for the USA as a state of law and worlds leading economy.

The USA is one of the greatest countries in the world. It simply cannot be that communism, socialism and expropriation are openly lived here and the constitution is knowingly violated. Fifth Amendment "...nor shall private property be taken for public use, without just compensation."

To cut an endless story short: The time has definitely come for Treasury Secretary Mnuchin, Director Calabria and especially SCOTUS to finally take the chance to iron out all the crime and the mistakes of the Obama administration and restore confidence in the current administration and in a functioning legal system of the United States of America.

Furthermore, at least one minute's silence should be held for all those countless shareholders as rightful company owners unwavering trusting in an sincere government and functioning legal system but finally deceased during the past decade of waiting and hoping in vain for final justice, while losing their hard earned savings and their pension because of unprecedented greed in the probably biggest financial crime in history.