Since the US government nationalized the two GSEs in 2008 in a $187 billion bailout of the mortgage giants, there have been consistent calls for them to be wound down and for the private sector to fill the void. As we discussed, this view is, or was, shared by new Fed Chairman, Jay Powell.
Mr. Powell has called on Congress to overhaul the housing finance system, saying he’d like to see the country’s two large mortgage-finance firms, Fannie Mae and Freddie Mac, move out from under government conservatorship. More private capital in those firms would reduce the risk of a taxpayer-funded bailout in the event of a downturn, he said in a speech in July. Although the Fed isn’t responsible for housing finance, it supervises some of the country’s largest lenders who frequently sell their loan to the two agencies. “No single housing finance institution should be too big to fail,” he said.
In August this year, Fannie and Freddie’s regulator, the Federal Housing Finance Agency (FHFA), published the results of its latest annual stress tests on the two GSE’s. The FHFA outlined a “severely adverse” scenario in which US real GDP decline 6.5%, the unemployment rate rises to 10.0%, equity prices decline almost 50%, home prices decline 25% and commercial real estate prices by 35%. Under these conditions, it estimates Fannie and Freddie would need a bailout of up to $100 billion in the form of a draw on the Treasury (depending on how they treat assets to offset tax). Mortgages guaranteed by Fannie and Freddie amount to about $4 trillion and account for about 40% of the total US market.
Sadly, after almost a decade of federal ownership, the hope that Fannie and Freddie could be wound down has evaporated. Senators on both sides of the political divide have concluded that they are too big and too risky to replace. Proposed legislation in 2018 will see them retained at the centre of the US mortgage industry, rather than replacing them as a previous senate proposal tried and failed four years ago. According to the Wall Street Journal.
Lawmakers in both parties and the Trump administration are negotiating overhauls of the two companies—critical to home mortgages but in government conservatorship since the financial crisis—that could keep them at the center of the U.S. mortgage market for years to come, abandoning long-stalled proposals to wind them down, people familiar with the matter said.
Bipartisan Senate legislation set to be introduced in early 2018 marks the clearest sign of this reversal and shows how the companies, entering their 10th year under federal control, have proven too risky to attempt replacing. The housing market has seen strong demand in recent years, driven in part by steady access for many Americans to 4% or lower 30-year fixed-rate mortgages, thanks in part to a government backstop of the companies. Advancing legislation to refashion the nation’s $10 trillion mortgage market is a heavy political lift and may yet sputter during the coming midterm-election year, as a prior Senate effort did four years ago. One big difference this time around: a more incremental approach largely reliant on the existing housing-finance framework.
The new plan, proposed by Senators. Bob Corker (R., Tenn.) and Mark Warner (D., Va.) could be introduced as early as next month. Instead of a new mortgage-finance system, Fannie and Freddie will be retained under government control and permitted to issue mortgage securities guaranteed by the Treasury until private sector competitors emerge. The GSE’s investment portfolios, which have fallen to less than $250 billion each from over $900 billion each at their peak, could be liquidated under the Senate plan.
“We’re looking for a more simplified approach that protects the taxpayer, preserves the 30-year fixed mortgage and includes stronger access and affordability provisions,” Mr. Warner said in a statement Friday.
However, Bloomberg’s sources acknowledge that a private sector alternative to Fannie and Freddie will not only take years to emerge, but it’s not clear which companies will enter the market. Besides having the advantage of bi-partisanship, the proposals have the advantage that politicians who wish to reform mortgage finance are reaching retirement age as Bloomberg notes.
Another factor bolstering chances for a deal is the retirement of Washington officials interested in reducing government control of housing, including Mr. Corker. The Tennessee senator has been working with Mr. Warner and Senate Banking Committee Chairman Mike Crapo (R., Idaho) all year on the issue, according to people familiar with the deliberations, and Mr. Crapo has made the overhaul a top goal for his panel.
Even House Financial Services Committee Chairman Jeb Hensarling (R., Texas) signaled this month in a speech to Realtors that he would like to see a Fannie and Freddie deal in what is to be his final year in Congress. Mr. Hensarling said he is still committed to replacing the companies, but has backed off a position that any future setup provide no federal backstop.
Reforming mortgage finance has not been a focus for the Trump administration and nor has it endorsed any proposed legislation thus far. However, Treasury officials are reported to have been in close contact with the Senate officials as the plan has emerged. Furthermore, Treasury Secretary Steven Mnuchin, who also headed up Goldman’s mortgage securities department in the late 1990s, disagreed with calls for abolishing Fannie and Freddie last month.
“No, I wouldn’t,” he said in an interview at November’s Wall Street Journal CEO Council meeting. “We have got to make sure that the housing system is built to last.”
Bloomberg reports that supporters of Corker and Warner’s proposal see a “narrow window” in early 2018 when the legislation could be added on to another bill to reduce post-crisis regulations in the financial sector.
The question about what to do with Fannie and Freddie has now come full circle since the financial crisis. In its aftermath, the consensus view became so negative that even long-time supporters, like Democrat Barney Frank, capitulated, saying they should be abolished. In 2013, Obama called on Congress to wind them down and “end Fannie and Freddie as we know them”. However, the tide started to turn shortly after due to the lack of confidence in mortgage bonds that didn’t have a government guarantee. The latest Senate proposal is the first having bipartisan backing which keeps Fannie and Freddie instead of replacing them.
So, a bit like the “Too Big To Fail” banks, the encroachment of government into parts of the financial system which it should never have entered, makes winding back that intervention difficult, if not impossible. We could have seen it coming as Bloomberg laments.
Washington’s about-face will come as little surprise to market participants who for years predicted that efforts to replace Fannie and Freddie, which together back around half of all outstanding mortgages, would prove too difficult. But the shift on Capitol Hill nevertheless illustrates one way in which policy ideologues appear to have lost ground to market realities.
News flash! Women’s Lives Now More Than Bearable
This is a contentious time for feminism. In the age of #MeToo, Time’s Up, and the Weinstein effect, just a few of the many products of the fourth-wave feminist movement, women are continuing to push forward a certain narrative about men and the Western culture’s effect on women in general. It seems as if the conversation surrounding women and gender equality has seeped into virtually every realm of life: politics, culture, religion, and even medicine and technology. Fourth-wave feminists are expressing their distrust in men in many ways…celebrities are calling out sexual predators in front of public audiences, politicians are using sexual assault as a political tool, and students are marching and demonstrating. Corporations, eager to jump on the “let’s make a political statement” bandwagon, are even using sexual assault as a marketing tool, spouting controversial messages about toxic masculinity and the like. A prime example is the recent Gillette ad, which garnered more than 19 million views on YouTube, Facebook, and Twitter.
Many women are also writing about feminism. One example of this is an article, written last year in celebration of International Women’s Day, that has been circulating on social media for the past few months. The article, entitled “100 Easy Ways to Make Women’s Lives More Bearable” and authored by Dani Beckett, has been shared more than 300,000 times since its publication in March 2018. While we would not exactly call it “viral,” it is no secret that the article’s contents are becoming increasingly normalized, currently believed by a meaningful number of female millenials. Beckett’s article was published in Broadly, a subset of Vice Media, a digital media and broadcasting company that launched Vice, the Canadian-American print magazine that gave rise to Broadly. Broadly, a heavily leftist channel catering to women and designed to “provide a space for us to understand, express, and navigate our identities as we define who we are and where we’re headed next,” has quite a solid readership.
After I kept encountering the article on Facebook for several months, I figured it was probably worth a read, but before reading it, I could not help but linger on the title. How to make women’s lives more…bearable? Bearable means tolerable, able to be endured, not even touching the realm of pleasurable or happy. The title implies that women in this country are struggling so much that someone desperately needs to make their lives “more bearable.” In a country where the vast majority of workplace fatalities befall men, the chief victims of non-fatal violence are men, men make up three quarters of all murder victims, women are outperforming men at all levels of education (they even outnumber men at most medical schools), women win custody battles, and women legally win half the earnings and belongings in a household, apparently women’s lives are not yet bearable enough. I was confused, but intrigued, and proceeded to make my way down the long list of male-targeted demands, some of which are too good not to highlight.
The article is written in an incredibly patronizing tone, as if men in America need to be taught that forcing sex upon a woman is probably not a good idea, as if they apparently grew up in a society that conditioned them to rape. The first item on Beckett’s list is, “Before explaining something to a woman, ask yourself if she might already understand. She may know more about it than you do.” Well, is that not general logical advice for anyone? I know the point is to call men out for supposedly always trying to explain things to a woman, but if you are versed in the basic tenets of communication, then it must be the case that you know not to prematurely lecture someone on a topic you suspect they are already well-versed in, regardless of their gender. And let us suppose this is not the case and you have a habit of being didactical when not needed. Well, then this advice should certainly go for everyone, not just men. The point is, gender has nothing to do with it. There is no evidence that men are somehow more likely than women to try to explain something to women, simply because they are women, before considering whether those women might actually understand the topic. Fourth-wave feminists are pushing the narrative that men inherently feel entitled and better than women, so they feel it necessary to always explain things to a woman without thinking if she might already understand. It is a dangerous and baseless narrative to push forward. While it was certainly true fifty years ago when male professors would not even call on their female students in lecture, today, men DO listen to women, whether they like it or not. By virtue of the professional empowerment of women, which has become normalized in Western society, men listen to women explain things to them every single day. Consider this: women now hold 49% of total faculty positions in American colleges and universities. Women lecture, and men listen.
Beckett then states, “Related: Never, ever try to explain feminism to a woman.” Well, what if she’s wrong? Beckett would tell you, “Trust women. When they teach you something, do not feel the need to go and check for yourself. And especially do not Google it in front of them.” So, if she’s wrong, it doesn’t matter. No one cares about facts anyway. Women are so privileged that they now also have the right to be wrong and to lie without getting called out. This is an important reminder of “Believe all women,” the Left’s mantra during the infamous Kavanaugh controversy. If you feel the need to check something JUST because the person who explained it to you is a woman, then maybe you need to treat your misogyny and perhaps Beckett’s list is actually for you. But we live in a society where women are leaders in every sphere – politics, business, medicine, science, the law. At this point, men get it. The need to overpower women, of which remnants will perhaps always exist, has largely dissipated through the years as evidenced by the fact that women now control 60% of the wealth in the United States, for example. If men are such misogynists, why are they collectively not fighting tooth and nail to tear down successful women? Certainly some are, but it’s virtually impossible to prove patriarchy-enforcing men outnumber matriarchy-enforcing women. Instead of acknowledging that, fourth-wave feminists are resorting to feelings, as opposed to facts, to craft their man-hating narrative. What’s more, they are lowering their standards for women.
Clearly, men and women are different, no matter what radical feminists want you to believe. But even though they are different, every society is founded upon a standard set of basic principles and values that every human, regardless of identity, should be obligated to follow in order to preserve civility. Lying does not all of a sudden become okay for a woman if it’s not okay for a man because women should not get special privileges. That is why Dani Beckett is also mistaken in suggesting “Be kind to women in customer service positions. Tip them extra.” Because they are a woman? This sentiment points directly to the pinnacle of feminists’ hypocrisy. Feminists want women to be treated equally, which naturally entails holding them to the same standards as men. Regardless of whether you are a woman or a man, if you don’t do your job well, then you should not be tipped extra. Regardless of whether you are a woman or a man, your customers should be nice to you if you do your job well because that’s the right thing to do.
Next on Beckett’s list is a whole compilation of demands centered around how to describe women. She states, “Examine your language when talking about women. Get rid of ‘irrational, dramatic, bossy, and badgering immediately.” This implies that women cannot be any of these things, which they most certainly can. Or perhaps it implies that they can be some or all of these things but they should not be called out for it, which once again, means that according to Beckett, we should hold women to a lower standard. Let’s be clear, women should not get free passes just because they are women and their ancestors have suffered through years of misogyny and oppression. If feminists want true equality, then they should not be cutting women slack and lowering their standards for women out of pity. Women are perfectly capable of meeting those standards. Pushing forward women’s rights legislation should not be done out of a need to prop up identity politics. Women deserve equal rights not because they are women, but because they are humans.
If that was not enough, Beckett certainly has more! “Never comment on a woman’s body,” she says. When describing women positively, men should say she is “talented,” “clever” or “funny,” but not “gorgeous” “sweet” or “cute.” Men also cannot call her unique, and “unlike other girls” because all girls are awesome. Long gone are the days when it was flattering for a woman to be told she has a nice physical appearance. And long gone are the days when men were allowed to make their physical attraction, the very basis of biological reproduction, known to women. I am assuming Beckett wants men to assign more value to women than their physical appearance, which is understandable, but assigning more value to personality and assigning some value to physical appearance are not mutually exclusive acts. A 2017 study published in Evolutionary Psychological Science found that most women are likely to choose physical attractiveness over personality and intelligence in potential partners. For a group of people who supposedly hate double standards, fourth-wave feminists sure do love double standards.
And now we arrive at the scariest portion of Beckett’s list: the postgenderism demands. Beckett states, “If you read stories to a child, swap the genders. Cast women in parts written for men. We know how to rule kingdoms, go to war, be, not be, and wait for Godot.” Right, and that is exactly why the parts of Katniss Everdeen, Hermione Granger, Wonder Woman, Lara Croft, Daenerys Targaryen, Mulan, and many, many more have been written. To show that women can indeed rule kingdoms, go to war, and do pretty much anything. Fourth-wave feminists are called “fourth-wave” because they are not the first. The women of the past have already proven that women are powerful and can rule kingdoms. There’s no need to reinvent the wheel by going to extreme measures (i.e. swapping genders) to show something that everyone, barring exceptions, already knows. Perhaps, then, the point of swapping genders is not so much to normalize powerful, masculine women. It is, in fact, to get rid of gender roles altogether. My prediction is that postgenderism will pave the way for fifth-wave feminism.
So why is one article like this one so important? It’s maybe just the opinion of one woman. Except it’s not. Between 70 and 80 percent of college women currently identify as feminists. The contents of Beckett’s article are at least somewhat representative of the mentality of young women in America today, even if some shy away from the label “feminist.” I fear that this association we have started to develop between feminism and fourth-wave values, some of which are exemplified in this article, will only become stronger until, eventually, first and second-wave feminists are shut out entirely. Women who are pro-life are shut out entirely. Women who want other women to be held accountable are shunned and considered anti-feminist. Criticizing obesity, pointing to false allegations of sexual assault, challenging the misconceptions surrounding the pay gap, holding conservative views about female sexuality, and acknowledging core differences between men and women will become wholly incompatible with any definition of feminism. Women should be encouraged to be strong, not feed their victimization complexes. Women should be encouraged to listen to other women, even if they disagree. Fourth-wave feminist indoctrination should not be something we stand for if we want to actually help gender equality.
Trump to Enact Massive Change to Prescription Drug Pricing, Sources Say
WASHINGTON — The Trump administration late Thursday afternoon proposed an effort to increase transparency when it comes to prescription drug pricing by cutting the widely used practice of middlemen — one of the major cost-drivers of drug prices.
President Donald Trump is strongly considering signing an executive order to do just that, according to four people inside the administration who asked for their identities to be withheld for various reasons.
The executive order which has already been drafted by White House counsel Pat Cipollone, would allow manufacturers of drugs to offer discounted pricing to customers, but would legally, stop them from giving rebates to pharmacy benefit managers.
“If you can’t manage a campaign, how do you manage the country?”: Chuck Todd schools Bernie Sanders
In a segment Thursday on MSNBC, network host Chuck Todd slammed Democratic Senator Bernie Sanders for allowing sexual misconduct to occur inside his 2016 presidential campaign.
“Could this derail his chances of another presidential bid,” host Chuck Todd wondered before playing a video clip.
“Boy, that is a tough answer to defend of course,” Todd said referring to Sanders telling CNN’s Anderson Cooper in an interview that he didn’t know about ongoing sexual misconduct because he was “a little busy running around the country trying to…make the case.”
“Because if you’re running to be president of the United States…if you can’t manage your campaign, how do you manage the country,” Todd continued. “No potential 2020 candidates had a worse start to 2019 than Bernie Sanders”