The gloves are off, and we now embark on a series of White Papers that will say what so many have refused to say publicly.Tonight we kick this off with the release of Trevor Thompsons groundbreaking White Paper entitled: “President Obama is Letting Fannie and Freddie Slip Away, and it will Destroy Opportunities for African American Borrowers”.
This is a long overdue analysis that makes it brutally clear that in the absence of Fannie and Freddie Black Americans will be routinely preyed upon and lose access to Americas mortgage market.This is a simple fact that is proven beyond a shred of doubt. By publishing and publicizing this paper we have laid down the gauntlet, President Obama can either continue the path he is on and accept the consequences that his inaction will directly bring about, or he can listen to reason and do the right thing. Now that the truth has been laid out in such intricate detail he can no longer feign ignorance, or imply that it is out of his hands.Up until now President Obama has had the luxury of navigating the shadows on this issue, that luxury has been rescinded tonight.In the absence of his leadership on this issue, we have not only taken over the reigns but are committed to forcing him to be straight with his constituents. If he chooses to hand the secondary mortgage over to the big banks at the expense of Black Americans, let him honestly communicate that.This would prove true the words of Dr. Cornel West who states:
“He posed as a progressive and turned out to be counterfeit. We ended up with a Wall Street presidency”.
I can attest that this view is widely shared in Black communities all across America. Publicly they may proclaim their support and belief in President Obama but the reality on the streets is a great disappointment.
The paper begins with a two-page Executive Summary:
1. America has a long history of racial discrimination in housing. It began with exclusionary policies, but has shifted to a trend of exploitation.
African Americans have been the target of discrimination in housing for as long as we’ve had housing. It started with racial zoning restrictions (banned in 1917), then progressed to exclusionary covenants in titles and deeds banning blacks from ever purchasing specific properties (partially banned in the late 1940s, fully banned in 1968), then led to real estate agents “steering” blacks away from white neighborhoods, a practice their licenses sometimes depended upon (also banned in 1968). These things all led to a distinct segregation of African Americans into specific neighborhoods, and these neighborhoods were discriminated against as a matter of both public and institutional policy, a practice known as redlining.
There is a raft of evidence that proves banks are still discriminating against African Americans, though now they are targeting them instead of excluding them. African Americans were three times more likely to get a subprime (high cost) loan than whites. African Americans are 45% more likely to lose the ability to be a homeowner. African Americans were foreclosed on at 2.5 times the rate of whites. Many of the largest banks in the country have been sued for these practices and either lost or settled. PNC had to pay $35 million. Wells Fargo had to pay $175 million. Bank of America had to pay $335 million. In addition, there are more than 15 lawsuits ongoing.
2: Fannie Mae and Freddie Mac (the GSEs) fight the banks to restore balance to the market and prevent discrimination, as required by law.
Fannie and Freddie provide a number of incredibly important benefits to low income and minority borrowers:
§ First, GSEs are required to provide at least 55% of their business to low-to-moderate income Americans and minorities in “underserved areas.” They are required to do this by law, not just corporate policy.
§ Second, the GSEs are required by law to give a portion of their profits, a sum expected to be greater than a billion dollars a year, to the Housing Trust Fund, an organization exclusively devoted to helping “ultra-low income” individuals get the housing they need.
§ Finally, the GSEs also force banks to follow their underwriting standards, which disallow predatory lending. The stronger the GSEs, the more power they have to enforce this.
3: Republicans strongly oppose affordable housing and the GSEs. Due to President Obama’s delays, if the Republicans win the 2016 presidential election, they will be in a perfect position to eliminate them.
In 2008, President George W. Bush, a person who “despised” the GSEs, agreed to have the companies put into conservatorship, giving up control of the company to the FHFA, an arm of the government run by a presidential appointee. The companies were then forced into a large loan with a 10% interest rate on any money borrowed. Under the original agreement, Fannie and Freddie have paid back the loan in full, but in 2012 Obama allowed the terms to be changed. Under the new terms, instead of the 10% interest rate, the companies now had to give every penny they earned to the government, even if it far exceeded the former dividend payment.
While GSEs were poised to exit their conservatorship in 2012, they are now unable to do so because of the weakness created by Obama’s decision. Statements from Jeb Bush, Rand Paul, and leading Republican Congressmen demonstrate that they are anxious for a chance to gut Fannie and Freddie. If a Republican wins the presidential election in 2016, it is a certainty that everything the GSEs do for minorities will be immediately stripped away.
4: Obama has the power to end the policies that are keeping Fannie and Freddie weak and vulnerable, but he has chosen not to. If he fails to do so, the demise of affordable housing and the protection of African American borrowers will fall squarely on his shoulders.
Obama has the power to release the companies right now, heading off the inevitable attacks on the GSEs and their affordable housing goals. By delaying this decision, he is gambling with the future of affordable housing in America. Obama needs to release these companies, and it is imperative to minorities and low-income borrowers that he do so quickly.
To remedy this, we strongly recommend that President Obama initiate a “reformed release”, whereby he re-amends the terms of the bailout loan, and then releases the companies from conservatorship, allowing them to regain the strength they need to ward off partisan attacks.
Please copy and paste this summary as well as the link to the entire paper in any emails you send to any politicians, reporters and groups that may be sympathetic with our cause or able to bring attention to this paper.It is vitally important that this paper gets circulated as far and wide as possible. https://drive.google.com/file/d/0B58sMbhyeWL2dEFxQmVtcV8xNk0/view
This is the first in a series of papers that we will be providing support for shortly.The next paper will detail the dire political ramifications that Democrats will face in 2016 unless Obama changes course on this issue.Two key points of that paper will be:1) The fact that Republicans have made it clear they will be running on the Peter Wallison narrative, that President Clintons housing policies caused the financial crisis. And 2)That unless Obama heeds the call of the Democrats most loyal constituents to reform/release Fannie, and Freddie Hillary will not get the turn out she will need to win. These two issues will converge and destroy any hopes Hillary has of winning the White House.
I must say I was not thrilled to see Steve Pearlstein’s article concerning the AIG and GSE lawsuits.http://www.washingtonpost.com/business/we-bailed-you-out-and-now-you-want-what/2015/06/05/95ba1be0-0a27-11e5-95fd-d580f1c5d44e_story.html
Steve was one of the most supportive journalists of Fannie and Freddie till now. I am preparing a scathing response to this but did not want Steves parroting of the tired old Hedge Funds VS Taxpayer story to distract from the White paper release. One item I do want to share now is a shocking revelation that turned up in the comments section of Steves article. It was written by a former State Trooper:
4:29 PM EDT
“I am a retired state police officer who invested in Fannie Mae Preferred in early 2008 after believing in and trusting what Fed Chair Bernanke said about them. As everyone, I questioned my holdings during the conservatorship period. I, however, took your advice on September 8, 2008 and held my shares. You wrote: “At this point, the best thing is probably to be very patient and hope the shares rise in value after the housing markets settles down, and the company comes out of conservatorship”. I have followed you for years at the Washington Post and now it appears that you have sided with the Treasury in condoning their theft of all profits and shunning my constitutional right as a property owner in this company. As you are aware, these entities have not only returned to profitability, but have well overpaid the bailout. You also seem to put blame on the GSE’s when the evidence is overwhelming that the Treasury forced the conservatorship and the GSEs indeed had no cash or operational issues at the time. I would love for you to reply to clear up my confusion.”
On September 8, 2008 2008 Steve hosted a Q and A session concerning the Conservatorship of Fannie and Freddie. He suggested that preferred shareholders hold their shares in the hope that if the GSEs can become profitable again their shares will return to full value.This was wise advice at the time considering the goal of the conservatorship was to restore the companies for an eventual release. It is shocking that after doling out this advice Steve sat by and watched as our government illegally seized all of the GSE profits just before they became immensely profitable.What is even more shocking is that now Steve not only is ignoring the seizure of funds but has actually resorted to blindly parroting the lies of our opponents.
I also want to commend the many patriots who have taken to the comments section of Steves article to share the truth about Fannie and Freddie, keep it up; we will prevail. Keep The Faith!
Edit- Governments motion to dismiss based on Plaintiffs not owning shares at time of Sweep.
6:8:15 DEFENDANT’S SUPPLEMENTAL MOTION TO DISMISS
I have attached a link to the PDF of the governments latest desperate attempt to evade justice .https://timhoward717.files.wordpress.com/2015/06/6815-defendant_s-supplemental-motion-to-dismiss.pdf
They have had this info since May 7, 2014, why wait till now? Our escalated bombing campaign which began last night combined with the threat of Ugolettis deposition going public has had just the effect I was hoping for.