8 03, 2024


2024-03-08T16:54:53-05:00March 8th, 2024|2- Daily Briefing|

Biden Continues Junk Fee Campaign

The President continued his attack on junk fees in the State of the Union, applauding the CFPB’s new credit-card late fee rule.  The President also boasted about recent monetary data, calling the American economy “the envy of the world” and called for Congress to pass Sen. Casey’s (D-PA) bill to stop shrinkflation.

FRB Finalizes FMU OpsRisk Update

The FRB today unanimously voted to finalize an update to rules governing operational risk-management for certain systemically-important financial market utilities (FMUs).

CFPB Lays Groundwork for Mortgage Closing-Cost Regulation

Continuing its campaign against junk fees, the CFPB today released a blog post focusing on mortgage closing cost fees, stating that the agency will issue rules and guidance “as necessary” to improve competition and affordability in the coming months.  The post states that median total loan costs increased 22 percent on home purchase loans from 2021 to 2022, noting that many of these costs are fixed and not affected by interest rates.


31 01, 2024


2024-01-31T12:41:24-05:00January 31st, 2024|4- GSE Activity Report|

Would a Trump Victory Set the GSEs Free?

Common-stock investors clearly think so, but they’re a notably speculative lot and more than likely wrong.  In this report, we lay out why we think the limbo in which the GSEs have languished since 2008 is now a permanent quasi-vegetative state.


22 01, 2024


2024-01-22T16:02:39-05:00January 22nd, 2024|4- GSE Activity Report|

Securitization and Systemic Risk

A new Fed staff study uses models to conclude that government-backed mortgage securitization  exacerbates financial crises, contradicting conventional wisdom that – GSE blow-ups notwithstanding – properly-regulated GSEs create a liquid, diversified asset pool for an otherwise illiquid, risky asset class.  However, our read of the study leads us to side with conventional wisdom.


14 12, 2023


2023-12-14T15:28:18-05:00December 14th, 2023|4- GSE Activity Report|

Tackling Title

In a blog post today, Fannie quietly renews its quest for alternatives to traditional title insurance.  The post focuses in general on closing costs, noting for example how regressive these are by citing cost differences of 13% for low-income first-time homebuyers than for all homebuyers on median closing costs as a percent of the home purchase price and 19% for non-low-income repeat homebuyers.  Title insurance is discussed at length, with Fannie noting its efforts to allow homeowners to use lower-cost options as well as emphasizing the low risk of title claims due to real-estate data digitalization.  The post does not go on to suggest that Fannie might simply omit a title-insurance requirement for at least first-time or LMI borrowers, but this seems to be the point.


4 12, 2023


2023-12-04T16:41:17-05:00December 4th, 2023|2- Daily Briefing|

HFSC GOP to Press Regulatory-Agency Financial Innovation

Tuesday’s HFSC Digital Assets Subcommittee hearing will focus on regulatory-agency offices focused on financial innovation, a session sure to give GOP Members an opportunity to closely question the OCC’s witnesses about her agency’s hiring offer to a person heading this activity who turned out to have a fraudulent resume.

HFSC GOP Lays Out “Market-Based” Affordable Housing Approach

The HFSC majority-staff memo for Wednesday’s Housing Subcommittee hearing emphasizes GOP goals with regard to “market-based” solutions addressing affordable housing.  In this context, Fannie, Freddie, and FHA come in for criticism with regard to driving out private capital, but the memo makes no specific recommendations about how to address this or, indeed, many of the zoning, supply-chain, and other challenges it identifies.

FSB Toolkit Focuses on Critical Interdependencies

Following its initial consultation, the FSB today published its final report on enhancing third-party risk management, now laying out a flexible and nonbinding toolkit focused on incident reporting, identification of critical dependencies, interjurisdictional comparability and interoperability, and systemic risk management.  In addition to a list of terms and definitions, the report provides tools to help financial institutions and supervisors identify critical third-party services and manage their risks.


27 11, 2023


2023-11-27T11:49:59-05:00November 27th, 2023|4- GSE Activity Report|

An Advanced View of Regulatory Capital?

The most significant thing in FHFA’s final capital rule is not what is to be done, but what FHFA left out: ending the GSEs’ advanced-approach requirement.  As a result, Fannie and Freddie can still use models for key calculations, a requirement that makes more sense for two complex organizations than it did for the regional banks also long subject to advanced-approach requirements even though the rules required them, like GSIBs, to hold the higher of the standardized or advanced approach.


20 09, 2023


2023-09-20T09:32:14-04:00September 20th, 2023|4- GSE Activity Report|

It’s Not Over…

Or maybe it is, but not everyone has heard.  Earlier this week, Rep. Andrew Ogles (R-TN) introduced H. R. 5549 to require Treasury to give Congress a complete plan to end the GSEs’ conservatorship.  Our forecast:  don’t wait up.  Our observation:  it’s interesting that a conservative freshman hasn’t given up even though there’s no sign that his leadership has any interest reviving this idea.  This is far too early and far too little to suggest a leading indicator to renewed Republican interest in tackling the GSEs now that Pat Toomey is gone from the Senate, but it’s noteworthy nonetheless.


11 08, 2023


2023-08-11T16:27:33-04:00August 11th, 2023|3- This Week|

The Capital Construct Continued

Even as we stay on watch for new regional-bank resolution rules, and keep you posted on some high-impact events (see below), we’ve been plowing through hundreds of pages of regulatory-capital rewrites.  Last week, we built on our in-depth analyses of the overall capital framework (see FSM Report CAPITAL230) and the new approach to credit risk (see FSM Report CAPITAL231) with several new in-depth assessments.


10 08, 2023

FedFin on: 9th Inning Results

2023-08-11T16:25:22-04:00August 10th, 2023|The Vault|

FHFA today released the results of the ninth stress test it’s run on Fannie and Freddie since Dodd-Frank demanded this in 2010.  Using pretty much the same flawed models as the Fed, FHFA finds Fannie and Freddie pretty much as they are even under acute stress.

The full report is available to subscription clients. To find out how you can sign up for the service, click here.…

10 08, 2023


2023-08-10T16:41:31-04:00August 10th, 2023|4- GSE Activity Report|

9th Inning Results

FHFA today released the results of the ninth stress test it’s run on Fannie and Freddie since Dodd-Frank demanded this in 2010.  Using pretty much the same flawed models as the Fed, FHFA finds Fannie and Freddie pretty much as they are even under acute stress.


Go to Top