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Fannie Mae Reports Massive Q3 Loss, Asks For Another $15 Billion From Government As It Is Set To Become Largest US Landlord
The latest particular does of lunacy and economic calamity coming out of the intellectual midgets at Fannie and the FHA should be sufficient to push the market well into 1,100 territory tomorrow. FNM's loss for Q3 is $18.9 billion, up from $14.8 billion in Q2, a time when the market was up a good 15%: ever wonder who keeps on subsidizing those gain? That's right - you. Credit-related expenses increased to $22 billion in Q3 from $18.8 billion in Q2. Oh, and Fannie now wants another $15 billion rescue from the Treasury (which is having some troubles with getting that pesky debt ceiling raised to one googol) so it can continue with its plan of keeping shadow inventory away from the market, rent foreclosed houses to their owners at staggeringly low rates, and continue the pretence that bank's balance sheets are well capitalized. Seriously, is the twilight zone any more palatable if one just drinks the Kool Aid or takes some crazy/stupid pills? We are ready and willing for the plunge.
From the just released results by bankrupt Fannie Mae:
WASHINGTON, DC – Fannie Mae (FNM/NYSE) reported a net loss of $18.9 billion in the third quarter of 2009, compared with a loss of $14.8 billion in the second quarter of 2009. Including $883 million of dividends on our senior preferred stock held by the U.S. Department of Treasury, the net loss attributable to common stockholders was $19.8 billion, or ($3.47) per diluted share, in the third quarter of 2009, compared with a loss of $15.2 billion, or ($2.67) per diluted share, in the second quarter of 2009. Third-quarter results were largely due to $22.0 billion of credit-related expenses, reflecting the continued build of the company’s combined loss reserves and fair value losses associated with the increasing number of loans that were acquired from mortgage-backed securities trusts in order to pursue loan modifications.
The loss resulted in a net worth deficit of $15.0 billion as of September 30, 2009, taking into account unrealized gains on available-for-sale securities during the third quarter. As a result, on November 4, 2009, the Acting Director of the Federal Housing Finance Agency (FHFA) submitted a request for $15.0 billion from Treasury on the company’s behalf. FHFA has requested that Treasury provide the funds on or prior to December 31, 2009.
The company continued to concentrate on preventing foreclosures and providing liquidity to the mortgage market during the third quarter of 2009, with much of our effort focused on the Making Home Affordable Program. As of September 30, 2009, approximately 189,000 Fannie Mae loans were in a trial period or a completed modification under the Home Affordable Modification Program. In addition, we completed loan workouts outside of the Home Affordable Modification Program, including modifications, HomeSaver AdvancesTM, repayment plans and forbearances, preforeclosure sales, and deeds in lieu of foreclosure, that we describe further in “Other Home-Retention and Foreclosure-Prevention Efforts” below.
If anyone gives a shit and wants to read the whole filing before buying FNM stock in the afterhours, here it is.
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nothing to see here, folks. please move along.
Ready and willing for the plunge eh, Fed says: No soup for you!
Freaking incredible. Thank Godness, 98% of the population is oblivious.
it's a good thing that the guy from FHA recently said that FHA would not need a bailout...phew, i was worried there for a sec.
seriously, how many days after the november 2010 midterm elections will FHA implode and need a bailout:
a. election day evening, two minutes after the west coast polls close.
b. the day after elections.
c. never, because "all is good" and "the subprime crisis is contained"
Like the trains of Barcelona, FNM is right on schedule for the next infusion of borrowed cash.
Treasury is running out of fingers to plug all the holes in this dike. And Fannie has a long, long future of accelerating losses yet to come.
Headline on MW "Fannie Mae third-quarter loss narrows" must be good, I am off to buy some based on that, they must be doing well.....
Can I get some vodka for my kool-aid, turpentine anything??????
Renting out their REOs will return them to profitability in no time.
Come on Tyler, who doesn't want to live for free.. 2 Years of no work benefits, free housing, food stamps, health care, a CostCo chicken in every pot. Hell, Tyler wake up - this sound like utopia. Close your eyes and picture me dropping to my knees and praying to Obama... Thank you Dear Leader, thank you.... for F'in up my COUNTRY.
I won't be wronged, I won't be insulted, and I won't be laid a hand on. I don't do these things to other people, and I require the same from them.
Books.
Not just FNMA, but perhaps BofA and others. We can anticipate zombie inventory for quite some time to come.
Only $1B less than the Fed bought in MBS. This week.
Notice the Fed has basically given up the pretext of buying Ginnies. This is all about bailing out Fannie/Freddie.
http://www.ny.frb.org/markets/mbs/
Gross purchases from October 29 through November 4: $16,000 million
Net purchases from October 29 through November 4:: $16,000 million
If you want to Make Homes Affordable, let the bloody market clear!
posted elsewhere but worth repeating
Warren (all in bet for America) Buffett and Lloyd are joining forces to plunder Fannie and the American taxpayer
http://www.marketwatch.com/story/buffett-joins-goldmans-fannie-tax-credi...
Like Sprint, FNMA continues to lose quarter after quarter regardless of strategy, leader or markets served. Why do people keep investing in such hopeless enterprises?
Because it's too big to fail.
I laughed so hard when i read this.
GM,AIG, FNM, FRE, C ect- one giant circle jerk funded by the taxpayer. The irony is, that the taxpayer also gets to eat the disintegrating, disgusting cracker.
Every week i think how much more phucked can it get. Amusingly , each week contains an upside surprise.
I am going to do some hopium. At least my personal twilight zone has an entrance and exit point.
the u.s. can always invade canada and steal what you guys have.
oil shales and maple leafs looking pretty good to our d.c. leaders lizzie.
Lizzy, I just wish someone would provide a condom... youknowwhatimean?
Maybe if you're high on hopium you'd be willing to eat the soggy biscuit. Personally, I'll stick to being semi-sober and rational.
Rahmp up the printing presses!! Btw, where is Robo? Need an update from the wildebeest herds and GS prop desk traders trampling over and chomping away at distressed deflationistas!
Its really true isnt it?
All empires crumble from the massive debts they run up.
Someone please explain to me why this ISN'T the Fed covering losses on its own massive exposure to Agency MBS?
A poop A poop A poop la grande
A poop A poop a punchbowl of poop
Tax payer money sinking in the quick sand
ooooof Fannie Mae
that piece of shit
The government just won't quit
sinking our cash into
A poop A poop A poop la grande
Tax payer money sinking in the quick sand
Ohhhhh yeahhhhhh....
And it's only going to grow But only so far, because FHA took over this year So I guess the real question is, when does FHA losses exceed Fannie and Freddie's? Also when the 4-7 million (perhaps 7-10 by next summer) homes are put on the market, how much more in losses will result? After all if this is the majority of their capital, even what they are 'worth' can drop 20-50 percent. I'm guessing that's a few hundred billion per institution.