On Friday, FHFA totalled up its current take on how much the GSEs will need from Treasury, pulling back from its 2011 pessimism (forecasting a maximum draw of $311 billion by 2014) to a relatively positive range of between $191 to $209 billion (including the $187.5 billion drawn to date) by 2015. One reason for this significant improvement is the revised preferred-stock purchase agreement with Treasury, which ends the costly dividends that exacerbated draws in the prior scenarios, but a happier scenario for house prices is also at work here. Because the FHFA projections are not stress-tested and, as we read them, consider only one factor that drives GSE results, they provide little insight into the future of the GSEs or their real financial condition.

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