text:
e8vk
FORM 8-K
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 24, 2011
Federally chartered corporation 000-50231 52-0883107
(State or other jurisdiction
of incorporation) (Commission
File Number) (IRS Employer
(Address of principal executive offices) 20016
Registrant's telephone number, including area code: 202-752-7000
(Former Name or Former Address, if Changed Since Last Report): ________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
The information in this report, including information in the exhibits submitted herewith, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of Section 18, nor shall it be deemed incorporated by reference into any disclosure document relating to Fannie Mae (formally known as the Federal National Mortgage Association), except to the extent, if any, expressly incorporated by specific reference in that document.
Item 2.02 Results of Operations and Financial Condition
On February 24, 2011, Fannie Mae filed its annual report on Form 10-K for the year ended December 31, 2010 and issued a news release reporting its financial results for the periods covered by the Form 10-K. The news release, a copy of which is furnished as Exhibit 99.1 to this report, is incorporated herein by reference.
Item 7.01 Regulation FD Disclosure
On February 24, 2011, Fannie Mae posted to its Web site a 2010 Credit Supplement presentation consisting primarily of information about Fannie Mae's guaranty book of business. The presentation, a copy of which is furnished as Exhibit 99.2 to this report, is incorporated herein by reference. Fannie Mae's Web site address is www.fanniemae.com. Information appearing on the company's Web site is not incorporated into this report.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The exhibit index filed herewith is incorporated herein by reference.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
By /s/ David C. Hisey
David C. Hisey
Executive Vice President and Deputy Chief Financial Officer
EXHIBIT INDEX
The following exhibits are submitted herewith:
Exhibit Number Description of Exhibit
News release, dated February 24, 2011
2010 Credit Supplement presentation, dated February 24, 2011
exv99w1
Resource Center: 1-800-732-6643
Janis Smith
Fannie Mae Reports Fourth-Quarter and Full-Year 2010 Results
Losses Decline and the Company Strengthens its Book of Business with New Acquisitions
WASHINGTON DC — Fannie Mae (FNMA/OTC) today reported net income of $73 million in the fourth quarter of 2010, compared to a net loss of $1.3 billion in the third quarter of the year. The change resulted from a decline in the company's credit-related expenses and the successful resolution of outstanding repurchase claims. Fannie Mae is building a strong new book of business and expects that new loans acquired since January 2009 will be profitable over their life cycle. The company is working to mitigate losses on its legacy book of business by focusing on reducing defaults, pursuing home retention solutions and foreclosure alternatives to help struggling homeowners, and pursuing contractual remedies from lenders and providers of credit enhancement.
The company's net loss attributable to common stockholders in the fourth quarter of 2010 was $2.1 billion, which included $2.2 billion in dividend payments to the U.S. Treasury. To eliminate the company's net worth deficit of $2.5 billion as of December 31, 2010 the Federal Housing Finance Agency (FHFA) has requested $2.6 billion on the company's behalf from Treasury, more than 80 percent of which is the dividend payment to Treasury. Upon receiving those funds, the company's total obligation to Treasury for its senior preferred stock will be $91.2 billion. Overall, the company has paid a total of $10.2 billion in dividends to Treasury since its senior preferred stock was issued, including $7.7 billion paid in 2010.
For the full year of 2010, Fannie Mae reported a net loss of $14.0 billion, compared with a loss of $72.0 billion for 2009. The net loss attributable to common stockholders, which includes the $7.7 billion in dividends paid to Treasury on the company's senior preferred stock, was $21.7 billion, or $(3.81) per diluted share for 2010, compared with $74.4 billion, or $(13.11) per diluted share, for 2009.
"Fannie Mae continues to make important strides as we build a strong new book of business, set new standards for credit quality in the mortgage industry, and maintain our focus on finding solutions for distressed borrowers and neighborhoods." said Michael J. Williams, president and chief executive officer. "As a result, Fannie Mae is a leading provider of capital and liquidity for single-family mortgages and affordable multifamily rental housing during this critical period in the housing recovery."
Fourth-Quarter and Full-Year 2010 Results
Providing Liquidity to the Market
During 2010, Fannie Mae guaranteed or purchased an estimated $856 billion in loans, which includes approximately $217 billion in delinquent loans purchased from its single-family mortgage-backed securities trusts. The company purchases loans out of MBS trusts and takes them on its balance sheet to improve its funding costs and to allow the company to pursue loss mitigation solutions like modifications to minimize potential losses on these loans. As a result of these purchases, Fannie Mae reduced the level of loans in MBS trusts that were delinquent as to four or more consecutive monthly payments from $127 billion to $8 billion as of year-end.
Fannie Mae continued to be the largest single issuer of mortgage-related securities in the secondary market in 2010, with an estimated market share of new single-family mortgage-related securities of 44.0 percent. In the multifamily market, Fannie Mae guaranteed an estimated 20.1 percent of multifamily mortgage debt outstanding as of September 30, 2010, the latest date for which the Federal Reserve has estimated mortgage debt outstanding for multifamily residences. The company financed approximately 2,712,000 single-family conventional loans, excluding delinquent loans purchased from its MBS trusts, and approximately 306,000 units in multifamily properties in 2010.
2009 — 2010 Single-Family Book of Business: The unpaid principal balance of single-family conventional loans Fannie Mae guaranteed or purchased since the beginning of 2009 total $1.28 trillion, more than 40 percent of its single-family guaranty book of business as of December 31, 2010. The company continues to expect that these loans will be profitable over their lifecycle, given their strong credit risk profile and performance to date. Conventional single-family loans added to Fannie Mae's book of business in 2009 and 2010 had a weighted average loan-to-value ratio at origination of 68 percent, and a weighted average credit score at origination of 762.
These loans have a stronger profile partly because the company changed its underwriting guidelines to more accurately reflect risk in the housing market and to significantly reduce acquisitions of higher-risk loans. The changes include a higher minimum FICO credit score and reduced maximum debt-to-income ratio for most loans, a national minimum down payment policy, increases in the company's guaranty fee pricing structure to better align risk and pricing, and updated appraisal policies.
2005 — 2008 Single-Family Book of Business: Fannie Mae reserved for or realized approximately $110 billion of losses on its single-family loans over the past two years. Most of these losses are attributable to loans purchased or guaranteed from 2005 through 2008. Fannie Mae estimates that it has reserved for the substantial majority of the remaining losses on these loans and that the company's results of operations have already reflected a substantial majority of the credit losses it has yet to realize on these loans, and expects that defaults on these loans and the resulting charge-offs will occur over a period of years. Given the large current and anticipated supply of single-family homes in the market, it will take years before Fannie Mae's inventory of real estate owned (REO) properties approaches pre-2008 levels.
Fannie Mae's single-family serious delinquency rate decreased to 4.48 percent as of December 31, 2010, from 4.56 percent as of September 30, 2010, and from 5.38 percent as of December 31, 2009. This decrease is primarily the result of loan workouts completed and foreclosed property acquisitions during the quarter and year, reflecting the company's emphasis on reducing delays in determining and executing the appropriate approach for a given loan. The 2005 to 2008 acquisitions are becoming a smaller percentage of the company's guaranty book of business, decreasing from 50 percent of its guaranty book of business as of December 31, 2009 to 39 percent as of December 31, 2010.
The ultimate performance of loans the company has acquired since the beginning of 2009 will be affected by macroeconomic trends, including unemployment, the economy, and home prices. For further discussion of the company's credit performance, see the Executive Summary of its annual report on Form 10-K for the year ended December 31, 2010, which was filed today with the Securities and Exchange Commission.
During 2010, Fannie Mae completed more than 515,000 single-family loan workouts, including over 440,000 home-retention solutions (including modifications, repayment plans, and forbearances). In the fourth quarter of 2010, the company completed home-retention solutions for approximately 90,000 loans with an aggregate unpaid principal balance of $18 billion. Details of the company's home-retention solutions, foreclosure alternatives, and refinances during 2010 include:
Loan modifications, including permanent modifications under the Treasury Department's Home Affordable Modification Program (HAMP), of 403,506 for 2010, compared with 98,575 in 2009. These figures do not include modifications in trial periods. Loan modification volume was over four times higher in 2010 than in 2009, as the number of borrowers who were experiencing financial difficulty increased and a significant number of HAMP trial modifications were completed and became permanent HAMP modifications. Completed modifications decreased in the fourth quarter of 2010 to 81,692 from 106,365 in the third quarter of 2010.
Repayment plans/forbearances completed of 31,579, compared with 22,948 in 2009. The company completed 7,973 repayment plans and forbearances in the fourth quarter of 2010, compared with 6,208 in the third quarter of 2010.
Preforeclosure sales and deeds-in-lieu of foreclosure of 75,391, compared with 39,617 in 2009. Fannie Mae agreed to an increasing number of preforeclosure sales and accepted a higher number of deeds-in-lieu of foreclosure during 2010 as these are favorable solutions in the case of a growing number of homeowners. The company completed 15,632 preforeclosure sales and deeds-in-lieu of foreclosure in the fourth quarter of 2010, compared with 20,918 in the third quarter of 2010. The decrease was due primarily to weak market conditions affecting pre-foreclosure sales during the quarter.
Refinanced loans purchased or guaranteed by Fannie Mae totaled approximately 2,113,000 in 2010 (including 659,000 loans through the company's Refi PlusTM initiative), compared with 2,484,000 refinances (including
329,000 through Refi Plus), in 2009. On average, homeowners who refinanced during 2010 through Refi Plus reduced their mortgage payments by $149 a month, or $1,788 annually.
Homeowner Initiatives: In the fourth quarter of 2010 and into 2011, Fannie Mae continued to develop programs and invest in initiatives that are designed to help keep people in homes, assist prospective homeowners, and support the mortgage and housing markets overall. During the fourth quarter and into the beginning of 2011:
Fannie Mae began offering modifications under its Second Lien Modification Program, which is designed to work in tandem with HAMP by lowering payments on second lien mortgage loans for homeowners whose second lien mortgage loan is owned by Fannie Mae and whose first lien mortgage loan has been modified under HAMP, even where the company does not own the first lien mortgage loan.
In 2010, Fannie Mae launched KnowYourOptions.comTM, a bilingual consumer education website that outlines the choices available to homeowners who are struggling with their mortgage payments, and provides guidance on how they can contact and work with their mortgage company to find solutions. In January 2011, Fannie Mae launched WaysHomeTM, an interactive multi-media tool designed to educate homeowners about their options to avoid foreclosure, empower them to make informed decisions and motivate them to take action and seek help. WaysHome is a new feature available on KnowYourOptions.com. Through video reenactment, WaysHome allows homeowners to experience scenarios that address a range of options for avoiding foreclosure that include repayment plans, forbearances, modifications, deeds-in-lieu, and short sales.
Fannie Mae continues to conduct homeowner outreach across the country and in 2010, opened Mortgage Help Centers in Miami, Chicago, Atlanta, Los Angeles, Phoenix and Dallas/Fort Worth with other locations to be announced in 2011. The company also uses direct mail and phone calls to encourage homeowners to pursue foreclosure alternatives, and has also established partnerships with counseling agencies in other communities to provide similar services.
Foreclosures and REO
Fannie Mae acquired 45,962 single-family REO properties through foreclosure in the fourth quarter of 2010, compared with 85,349 in the third quarter of 2010. The reduction was due, in part, to a pause in foreclosures triggered by the discovery of deficiencies in servicers' foreclosure processes. The company acquired 262,078 single-family REO properties through foreclosure in all of 2010, compared with 145,617 in 2009. As of December 31, 2010, the company's inventory of single-family REO properties was 162,489, compared with 166,787 as of September 30, 2010, and 86,155 as of December 31, 2009. The carrying value of the company's single-family REO was $15.0 billion, compared with $16.4 billion as of September 30, 2010, and $8.5 billion as of December 31, 2009.
As of December 31, 2010, approximately 27 percent of Fannie Mae's REO properties were within state or locally mandated redemption periods (during which time the foreclosed-upon borrower can regain title to his or her property by paying off the full amount due on the loan), which lengthens the time a property is in REO inventory by an average of two to six months because these properties can't be marketed until after the redemption period expires.
Additionally, as of December 31, 2010, approximately 40 percent of the company's properties that it is unable to market for sale were occupied, in some instances due to Fannie Mae's "Tenant-in-Place" or "Deed-for-Lease" programs. Properties that are occupied also remain in REO inventory for longer periods of time.
The company's single-family foreclosure rate, which reflects the annualized number of single-family properties acquired through foreclosure as a percentage of the total number of loans in its conventional single-family guaranty book of business, was 1.03 percent on an annualized basis in the fourth quarter of 2010, compared with 1.91 percent in the third quarter of 2010. The company's single-family foreclosure rate was 1.46 percent for 2010, compared with 0.80 percent for 2009.
Summary of Fourth-Quarter and Full-Year 2010 Results
Fannie Mae reported a net loss of $14.0 billion for 2010, compared with a loss of $72.0 billion for 2009. The company's net loss attributable to common stockholders was $21.7 billion, or $(3.81) per diluted share in 2010, compared with a loss of $74.4 billion, or $(13.11) per diluted share in 2009. The net worth deficit of $2.5 billion as of December 31, 2010 takes into account dividends paid on senior preferred stock held by Treasury.
(dollars in millions, except per share amounts) (1) 4Q10 3Q10 Variance 2010 2009(5) Variance
$ 4,637 $ 4,776 $ (139 ) $ 16,409 $ 14,510 $ 1,899
Guaranty fee income
45 51 (6 ) 202 7,211 (7,009 )
Fee and other income (1)
208 253 (45 ) 882 773 109
Net revenues
4,890 5,080 (190 ) 17,493 22,494 (5,001 )
Investment gains, net
Net other-than-temporary impairments (2)
(23 ) (326 ) 303 (722 ) (9,861 ) 9,139
Fair value gains (losses), net
366 525 (159 ) (511 ) (2,811 ) 2,300
Income (losses) from partnership investments
(37 ) 47 (84 ) (74 ) (6,735 ) 6,661
Administrative expenses
(592 ) (730 ) 138 (2,597 ) (2,207 ) (390 )
Credit-related expenses (3)
(4,318 ) (5,561 ) 1,243 (26,614 ) (73,536 ) 46,922
Other non-interest expenses (4)
(311 ) (457 ) 146 (1,421 ) (1,809 ) 388
Net losses and expenses
Income (loss) before federal income taxes and extraordinary losses
50 (1,340 ) 1,390 (14,100 ) (73,007 ) 58,907
Benefit for federal income taxes
15 9 6 82 985 (903 )
Net income (loss)
Less: Net (income) loss attributable to the noncontrolling interest
8 (8 ) 16 4 53 (49 )
Net income (loss) attributable to Fannie Mae
$ 73 $ (1,339 ) $ 1,412 $ (14,014 ) $ (71,969 ) $ 57,955
Preferred stock dividends
(2,154 ) (2,116 ) (38 ) (7,704 ) (2,474 ) (5,230 )
Net loss attributable to common stockholders
$ (2,081 ) $ (3,455 ) $ 1,374 $ (21,718 ) $ (74,443 ) $ 52,725
Diluted loss per common share
$ (0.37 ) $ (0.61 ) $ 0.24 $ (3.81 ) $ (13.11 ) $ 9.30
(1) Certain prior period amounts have been reclassified to conform to the current period presentation. Trust management income is included in fee and other income.
(2) Prior to an April 2009 change in account for impairments, net other-than temporary impairments also included the non-credit portion, which in subsequent periods is recorded in other comprehensive income.
(3) Consists of provision for loan losses, provision for guaranty losses and foreclosed property expense.
(4) Consists of debt extinguishment losses, net and other expenses.
(5) 2009 results do not reflect accounting standards for consolidation that the company adopted prospectively on January 1, 2010.
On January 1, 2010, Fannie Mae prospectively adopted new accounting standards, which had a significant impact on the presentation and comparability of its consolidated financial statements. The new standards resulted in the consolidation of the substantial majority of Fannie Mae's single-class securitization trusts and the elimination of previously recorded deferred revenue from our guaranty arrangements. While some line items in the company's consolidated statements of operations were not impacted, others were impacted significantly, which reduces the comparability of the company's results for 2010 with the results in prior years. For further discussion of the impact of the new accounting standards on the company's consolidated results of operations, see Management's Discussion and Analysis of Financial Condition and Results of Operations — Consolidated Results of Operations in its 2010 annual report on Form 10-K
Net revenues were $4.9 billion in the fourth quarter of 2010, down four percent from $5.1 billion in the third quarter of 2010, due primarily to a decrease in net interest income. For the year, net revenue was $17.5 billion, down 22 percent from $22.5 billion in 2009.
Credit-related expenses, which are the total provision for credit losses plus foreclosed property expense, were $4.3 billion in the fourth quarter, down from $5.6 billion in the third quarter of 2010. For the year, credit-related expenses were $26.6 billion, compared with $73.5 billion in 2009. Fannie Mae's provision for credit losses was substantially lower in 2010, as there was neither a significant increase in the number of seriously delinquent loans, nor a sharp decline in home prices. Therefore, the company did not need to substantially increase its total loss reserves in 2010.
Additionally, Fannie Mae's provision attributable to fair value losses on credit-impaired loans was $180 million in 2010 compared with $20.3 billion in 2009. On December 31, 2010, the company entered into an agreement with Bank of America, N.A., and its affiliates, to address outstanding repurchase requests for residential mortgage loans. Bank of America agreed, among other things, to a cash payment of $1.3 billion, $930 million of which was recognized as a recovery of charge-offs resulting in a reduction to the company's provision for guaranty losses and allowance for loan losses.
Fannie Mae expects that its credit-related expenses will remain high in 2011, and that its credit losses will be higher in 2011 than in 2010.
Credit losses, which the company defines generally as net charge-offs plus foreclosed property expense, excluding the effect of certain fair-value losses, were $3.2 billion in the fourth quarter of 2010, compared with $8.2 billion in the third quarter of 2010. For the year, credit losses were $23.6 billion, compared with $13.6 billion in 2009. The increase in 2010 reflects the increase in the number of defaults, particularly due to loans acquired by Fannie Mae from 2005 through 2008 with higher-risk attributes compared with current underwriting standards, the prolonged period of high unemployment and the decline in home prices. In addition, defaults in 2009 were lower than they could have been due to the foreclosure moratoria during the end of 2008 and first quarter of 2009. The increase in defaults during 2010 was partially offset by a slight reduction in average loss severity as home prices improved in some geographic regions.
Single-family credit losses realized in 2009 and 2010, combined with the amounts reserved for single-family credit losses as of December 31, 2010, total approximately $110 billion. The vast majority of these losses are attributable to single-family loans Fannie Mae purchased or guaranteed from 2005 through 2008. To reduce the credit losses the company ultimately incurs on its legacy book of business in the future, Fannie Mae is focusing on reducing defaults to avoid losses that otherwise would occur; efficiently managing timelines for home retention solutions, foreclosure alternatives, and foreclosures; pursuing foreclosure alternatives to reduce the severity of the losses incurred; managing its REO inventory to reduce costs and maximize sales proceeds; and pursuing contractual remedies from lenders and providers of credit enhancement, including mortgage insurers.
Total loss reserves and fair value losses previously recognized on acquired credit-impaired loans were $85.4 billion as of December 31, 2010, compared with $84.6 billion as of September 30, 2010. The company considers a portion of total fair value losses previously recognized on loans purchased out of MBS trusts as an "effective reserve," apart from our total loss reserves, to the extent that we expect to realize them as credit losses in the future. Total nonperforming loans in the company's guaranty book of business were $214.8 billion as of December 31, 2010, compared with $213.3 billion as of September 30, 2010.
Net fair value gains were $366 million in the fourth quarter of 2010, compared with gains of $525 million in the third quarter of 2010. For the year, net fair value losses were $511 million, compared with $2.8 billion of net fair value losses in 2009. In 2010, the company recognized trading gains of approximately $2.7 billion, which were more than offset by fair value losses on its derivatives of $3.0 billion.
Net other-than-temporary impairment charges recorded in 2010 were primarily driven by a net decline in forecasted home prices for certain geographic regions, which resulted in a decrease in the present value of Fannie Mae's cash flow projections on Alt-A and subprime securities. Net other-than-temporary impairment decreased in 2010 compared with 2009 due to slower deterioration of the estimated credit component of the fair value losses of these securities. In addition, net-other-than temporary impairment decreased in 2010 compared with 2009 because, effective beginning in the second quarter of 2009, the company recognizes only the credit portion of other-than-temporary impairment in its consolidated statements of operations due to the adoption of a new other-than-temporary accounting standard. The net other-than-temporary impairment charge recorded prior to April 1, 2009 included both the credit and non-credit components of the loss in fair value. Approximately 57% of the impairment recorded in 2009 was recorded in the first quarter of 2009 prior to the change in accounting standards.
See "Note 6, Investments in Securities" in Fannie Mae's 2010 Form 10-K for the year ended December 31, 2010 for additional information regarding the net other-than-temporary impairment recognized in 2010. The company provides further discussion of its financial results and condition, credit performance, fair value balance sheets, and other matters in its annual report on Form 10-K. Further information about the company's credit performance, the characteristics of its guaranty book of business, the drivers of its credit losses, its foreclosure-prevention efforts, and other measures is contained in the "2010 Credit Supplement" on Fannie Mae's website, www.fanniemae.com.
Net Worth and U.S. Treasury Funding
The Acting Director of FHFA has requested $2.6 billion of funds from Treasury on the company's behalf under the terms of the senior preferred stock purchase agreement between Fannie Mae and Treasury to eliminate the company's net worth deficit as of December 31, 2010. Fannie Mae's fourth quarter dividend of $2.2 billion on its senior preferred stock held by Treasury was declared by FHFA and paid by the company on December 31, 2010. Fannie Mae paid a total of $7.7 billion in dividends on the senior preferred stock to Treasury in 2010. In December 2010, Treasury provided to the company $2.5 billion to cure its net worth deficit as of September 30, 2010. As a result of this draw, the aggregate liquidation preference of the senior preferred stock increased from $86.1 billion to $88.6 billion as of December 31, 2010. It will increase to $91.2 billion upon the receipt of funds from Treasury to eliminate the company's fourth-quarter 2010 net worth deficit.
Through December 31, 2010, the company has paid in aggregate $10.2 billion to Treasury in dividends on the senior preferred stock. Fannie Mae does not expect to earn profits in excess of its annual dividend obligation to Treasury for the indefinite future. As draws for credit losses abate, the company expects its draws to be driven increasingly by dividend payments to Treasury.
Fair Value Update
The fair value of Fannie Mae's net assets increased by $10.6 billion from September 30, 2010, resulting in a fair value net deficit of $120.3 billion as of December 31, 2010, compared to a fair value net deficit of $98.8 billion as of December 31, 2009. As part of Fannie Mae's disclosure requirements with FHFA, the company discloses on a quarterly basis supplemental non-GAAP consolidated fair value balance sheets, reflecting the company's assets and liabilities at estimated fair value. The fair value of the company's net assets is not a measure defined within generally accepted accounting principles and may not be comparable to similarly titled measures reported by other companies. The estimated fair value of the company's net assets is calculated as of a particular point in time based on its existing assets and liabilities, and does not incorporate other factors that may have a significant impact on its long-term fair value.
As a result, the estimated fair value of the company's net assets presented in its non-GAAP consolidated fair value balance sheets does not represent an estimate of its net realizable value, liquidation value, or its market value as a whole. In addition, the fair value of the company's net assets attributable to common stockholders presented in its fair value balance sheet does not represent an estimate of the value it expects to realize from operating the company, nor what it expects to draw from Treasury under the terms of the senior preferred stock purchase agreement.
For more information on the change in the company's fair value net deficit, please refer to "Supplemental Non-GAAP Information — Fair Value Balance Sheets" in the company's annual report on Form 10-K for the year ended December 31, 2010. See also "Supplemental Non-GAAP Consolidated Fair Value Balance Sheets" and "Explanation and Reconciliation of Non-GAAP Measures to GAAP Measures" later in this release for a reconciliation of the company's fair value balance sheets to its GAAP consolidated balance sheets.
Business Segment Results
Fannie Mae conducts its activities through three complementary businesses: our Single-Family business, our Multifamily business, and our Capital Markets group. As a result of the adoption of new accounting standards and changes to Fannie Mae's segment presentation in 2010, segment results reported for the current periods are not comparable with prior years' segment results. The company's Single-Family and Multifamily businesses work with Fannie Mae's lender customers to purchase and securitize mortgage loans customers deliver into Fannie Mae MBS. The Capital Markets group manages the company's investment activity in mortgage-related assets, funding investments primarily with proceeds received from the issuance of Fannie Mae debt securities in the domestic and international capital markets. The Capital Markets group also provides liquidity to the mortgage market through short-term financing and other activities.
Single-Family guaranty book of business was $2.87 trillion as of December 31, 2010, compared with $2.85 trillion as of September 30, 2010, and $2.91 trillion as of December 31, 2009. Single-family guaranty fee income for the fourth quarter of 2010 was $1.8 billion, the same as the third quarter of 2010. The Single-Family business lost $3.6 billion in the fourth quarter of 2010, compared with a loss of $5.5 billion in the third quarter of 2010, due primarily to credit-related expenses of $4.1 billion, almost all of which were attributable to loans purchased or guaranteed from 2005 through 2008. For the year, the Single-Family business lost $26.7 billion, compared with a loss of $63.8 billion in 2009, due primarily to a decrease in credit-related expenses.
Multifamily guaranty book of business as of December 31, 2010 was $189.4 billion, compared with $187.4 billion as of September 30, 2010, and $185.3 billion as of December 31, 2009. Multifamily recorded credit-related expenses of $254 million in the fourth quarter of 2010, compared with $2 million in the third quarter of 2010. Multifamily lost $183 million in the fourth quarter of 2010, compared with $181 million earned in the third quarter of 2010. For the year, Multifamily earned $216 million, compared with a loss of $9.0 billion in 2009 that was largely driven by losses on the company's low income housing tax credit partnership investments and an increase in the provision for credit losses to build our multifamily loss reserves.
Capital Markets' net interest income was $3.7 billion in the fourth quarter of 2010, compared with $4.1 billion in the third quarter of 2010. For the year, net interest income was $14.3 billion, the same as in 2009. Fair value gains were $358 million, compared with $436 million in the third quarter of 2010. Net other-than-temporary impairment was $24 million, compared with $323 million in the third quarter of 2010. The net mortgage investment portfolio balance decreased to $788.8 billion as of December 31, 2010, compared with $802.9 billion on September 30, 2010, from purchases of $65.3 billion, liquidations of $40.8 billion, and sales of $38.6 billion during the quarter. Capital Markets earned $4.7 billion in the fourth quarter of 2010, compared with $4.8 billion in the third quarter of 2010. For the year, Capital Markets earned $16.1 billion, compared with $857 million in 2009.
In this release, the company has presented a number of estimates, forecasts, expectations, and other forward-looking statements regarding the company's future financial results; the profitability of its loans; future, credit losses, credit-related expenses, defaults, charge-offs and REO inventory; its draws from and dividends to be paid to Treasury; the performance and caliber of loans it has acquired and will acquire; its credit loss reduction efforts; its planned homeowner initiatives. These estimates, forecasts, expectations, and statements are forward-looking statements and are based on the company's current assumptions regarding numerous factors, including assumptions about future home prices and the future performance of its loans. The company's future estimates of these amounts, as well as the actual amounts, may differ materially from its current estimates as a result of home price changes, interest rate changes, unemployment, other macroeconomic variables, government policy matters, changes in generally accepted accounting principles, credit availability, social behaviors, the volume of loans it modifies, the effectiveness of its loss mitigation strategies, management of its real estate owned inventory and pursuit of contractual remedies, changes in the fair value of its assets and liabilities, impairments of its assets, the adequacy of its loss reserves, its ability to maintain a positive net worth, effects from activities the company takes to support the mortgage market and help homeowners, the conservatorship and its effect on the company's business, the investment by Treasury and its effect on the company's business, changes in the structure and regulation of the financial services industry, the company's ability to access the debt markets, disruptions in the housing, credit, and stock markets, government investigations and litigation, the extent of the servicer foreclosure process deficiencies and the duration of the related foreclosure pause, and many other factors. Changes in the company's underlying assumptions and actual outcomes, which could be affected by the economic environment, government policy, and many other factors, including those discussed in the "Risk Factors" section of the company's annual report on Form 10-K for the period ended December 31, 2010, and elsewhere in this release, could result in actual results being materially different from what is set forth in the forward-looking statements.
Fannie Mae provides website addresses in its news releases solely for readers' information. Other content or information appearing on these websites is not part of this release.
Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America's secondary mortgage market to enhance the liquidity of the mortgage market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers. Our job is to help those who house America.
(In conservatorship)
(Dollars in millions, except share amounts)
As of December 31,
Cash and cash equivalents (includes cash of consolidated trusts of $348 and $2,092, respectively)
$ 17,297 $ 6,812
Restricted cash (includes restricted cash of consolidated trusts of $59,619 and $-, respectively)
Federal funds sold and securities purchased under agreements to resell or similar arrangements
Investments in securities:
Trading, at fair value (includes securities of consolidated trusts of $21 and $5,599, respectively)
Available-for-sale, at fair value (includes securities of consolidated trusts of $1,055 and $10,513, respectively, and securities pledged as collateral that may be sold or repledged of $- and $1,148, respectively)
Total investments in securities
Mortgage loans:
Loans held for sale, at lower of cost or fair value
Loans held for investment, at amortized cost:
Of Fannie Mae
Of consolidated trusts (includes loans at fair value of $2,962 and $-, respectively, and loans pledged as collateral that may be sold or repledged of $2,522 and $1,947, respectively)
Total loans held for investment
(61,556 ) (9,925 )
Total loans held for investment, net of allowance
Total mortgage loans
Accrued interest receivable:
Of consolidated trusts
Allowance for accrued interest receivable
(3,414 ) (536 )
Total accrued interest receivable, net of allowance
Acquired property, net
Servicer and MBS trust receivable
$ 3,221,972 $ 869,141
LIABILITIES AND EQUITY (DEFICIT)
Accrued interest payable:
Federal funds purchased and securities sold under agreements to repurchase
Short-term debt:
5,359 —
Long-term debt:
Of Fannie Mae (includes debt at fair value of $893 and $3,274, respectively)
Of consolidated trusts (includes debt at fair value of $2,271 and $-, respectively)
2,411,597 6,167
Reserve for guaranty losses (includes $54 and $4,772, respectively, related to Fannie Mae MBS included in Investments in securities)
Servicer and MBS trust payable
Commitments and contingencies (Note 20)
Fannie Mae stockholders' equity (deficit):
Senior preferred stock, 1,000,000 shares issued and outstanding
Preferred stock, 700,000,000 shares are authorized—576,868,139 and 579,735,457 shares issued and outstanding, respectively
Common stock, no par value, no maximum authorization—1,270,092,708 and 1,265,674,761 shares issued, respectively; 1,118,504,194 and 1,113,358,051 shares outstanding, respectively
— 2,083
Accumulated deficit
(102,986 ) (90,237 )
Accumulated other comprehensive loss
Treasury stock, at cost, 151,588,514 and 152,316,710 shares, respectively
Total Fannie Mae stockholders' deficit
(2,599 ) (15,372 )
Noncontrolling interest
Total deficit
Total liabilities and equity (deficit)
See Notes to Consolidated Financial Statements
(Dollars and shares in millions, except per share amounts)
For the Year Ended
Interest income:
$ 1,251 $ 3,859 $ 5,878
5,290 13,618 13,214
14,992 15,378 18,547
132,591 6,143 4,145
146 357 1,339
Total interest income
154,270 39,355 43,123
Interest expense:
619 2,306 7,815
12 — —
118,373 344 381
Total interest expense
16,409 14,510 8,782
Provision for loan losses
(24,702 ) (9,569 ) (4,022 )
Net interest income (loss) after provision for loan losses
(8,293 ) 4,941 4,760
Guaranty fee income (includes imputed interest of $111, $1,333 and $1,423, respectively)
Investment gains (losses), net
346 1,458 (246 )
Other-than-temporary impairments
(694 ) (9,057 ) (6,974 )
Noncredit portion of other-than-temporary impairments recognized in other comprehensive loss
(28 ) (804 ) —
Net other-than-temporary impairments
Fair value losses, net
(511 ) (2,811 ) (20,129 )
Debt extinguishment losses, net (includes debt extinguishment losses related to consolidated trusts of $109, $- and $-, respectively)
(568 ) (325 ) (222 )
Losses from partnership investments
(74 ) (6,735 ) (1,554 )
Fee and other income
Non-interest loss
(445 ) (10,290 ) (20,471 )
Administrative expenses:
Salaries and employee benefits
Occupancy expenses
Other administrative expenses
Total administrative expenses
Provision for guaranty losses
Foreclosed property expense
Total expenses
Loss before federal income taxes and extraordinary losses
(14,100 ) (73,007 ) (44,570 )
Provision (benefit) for federal income taxes
(82 ) (985 ) 13,749
Loss before extraordinary losses
Extraordinary losses, net of tax effect
— — (409 )
Less: Net loss attributable to the noncontrolling interest
Net loss attributable to Fannie Mae
(7,704 ) (2,474 ) (1,069 )
$ (21,718 ) $ (74,443 ) $ (59,776 )
Loss per share — Basic and Diluted
$ (3.81 ) $ (13.11 ) $ (24.04 )
Cash dividends per common share
$ — $ — $ 0.75
Weighted-average common shares outstanding — Basic and Diluted
(Dollars in millions)
For the Year Ended December 31,
Cash flows (used in) provided by operating activities:
Reconciliation of net loss to net cash (used in) provided by operating activities:
Amortization of cost basis adjustments
Provisions for loan and guaranty losses
Valuation (gains) losses
(1,289 ) 3,425 12,725
Current and deferred federal income taxes
258 (1,919 ) 12,904
— — 409
Purchases of loans held for sale
(81 ) (109,684 ) (56,768 )
Proceeds from repayments of loans held for sale
Net change in trading securities, excluding non-cash transfers
(23,612 ) 11,976 72,689
Other, net
Net cash (used in) provided by operating activities
(27,395 ) (85,909 ) 15,853
Cash flows provided by (used in) investing activities:
Purchases of trading securities held for investment
(8,547 ) (48,659 ) (7,635 )
Proceeds from maturities of trading securities held for investment
2,638 12,918 9,530
Proceeds from sales of trading securities held for investment
Purchases of available-for-sale securities
(413 ) (165,103 ) (147,337 )
Proceeds from maturities of available-for-sale securities
Proceeds from sales of available-for-sale securities
7,867 306,598 146,630
Purchases of loans held for investment
Proceeds from repayments of loans held for investment of Fannie Mae
Proceeds from repayments of loans held for investment of consolidated trusts
Net change in restricted cash
(15,025 ) — —
Advances to lenders
Proceeds from disposition of acquired property and preforeclosure sales
Contributions to partnership investments
(351 ) (688 ) (1,507 )
Proceeds from partnership investments
Net change in federal funds sold and securities purchased under agreements to resell or similar agreements
41,471 4,230 (9,793 )
Net cash provided by (used in) investing activities
540,179 117,735 (72,507 )
Cash flows (used in) provided by financing activities:
Proceeds from issuance of short-term debt of Fannie Mae
699,346 1,641,119 1,913,685
Payments to redeem short-term debt of Fannie Mae
(748,550 ) (1,773,977 ) (1,824,511 )
Proceeds from issuance of long-term debt of Fannie Mae
456,602 289,806 243,180
Payments to redeem long-term debt of Fannie Mae
(397,813 ) (256,728 ) (266,758 )
Proceeds from issuance of short-term debt of consolidated trusts
12,613 — —
Payments to redeem short-term debt of consolidated trusts
Proceeds from issuance of long-term debt of consolidated trusts
263,962 58 377
Payments to redeem long-term debt of consolidated trusts
(771,292 ) (601 ) (467 )
Payments of cash dividends on senior preferred stock to Treasury
(7,706 ) (2,470 ) (31 )
Payments of cash dividends on common and preferred stock
— — (1,774 )
Proceeds from issuance of common and preferred stock
— — 7,211
Proceeds from senior preferred stock purchase agreement with Treasury
27,700 59,900 —
Net change in federal funds purchased and securities sold under agreements to repurchase
49 (54 ) (266 )
Net cash (used in) provided by financing activities
(502,299 ) (42,947 ) 70,646
Net increase (decrease) in cash and cash equivalents
10,485 (11,121 ) 13,992
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
$ 17,297 $ 6,812 $ 17,933
Cash paid during the period for:
$ 140,651 $ 26,344 $ 35,959
Non-cash activities (excluding transition-related impacts — see Note 2):
Mortgage loans acquired by assuming debt
$ 484,699 $ — $ 167
Net transfers from mortgage loans held for investment of consolidated trusts to mortgage loans held for investment of Fannie Mae
121,852 — —
Transfers from advances to lenders to investments in securities
— 77,191 83,534
Transfers from advances to lenders to loans held for investment of consolidated trusts
Net transfers from mortgage loans to acquired property
Consolidated Statements of Changes in Equity (Deficit)
Fannie Mae Stockholders' Equity (Deficit)
Accumulated
Shares Outstanding Additional
Paid-In
(Accumulated
Preferred Preferred Common Preferred Stock Stock Capital Deficit) Loss Stock Interest (Deficit)
Balance as of December 31, 2007
— 466 974 $ — $ 16,913 $ 593 $ 1,831 $ 33,548 $ (1,362 ) $ (7,512 ) $ 107 $ 44,118
Cumulative effect from the adoption of the accounting standards on the fair value option for financial instruments and fair value measurement, net of tax
— — — — — — — 148 (93 ) — — 55
Balances of January 1, 2008 adjusted
— 466 974 — 16,913 593 1,831 33,696 (1,455 ) (7,512 ) 107 44,173
Change in investment in noncontrolling interest
— — — — — — — — — — 71 71
Comprehensive loss:
— — — — — — — (58,707 ) — — (21 ) (58,728 )
Other comprehensive loss, net of tax effect:
Changes in net unrealized losses on available-for-sale securities (net of tax of $5,395)
— — — — — — — — (10,020 ) — — (10,020 )
Reclassification adjustment for other-than- temporary impairments recognized in net loss (net of tax of $2,441)
— — — — — — — — 4,533 — — 4,533
Reclassification adjustment for gains included in net loss (net of tax of $36)
— — — — — — — — (67 ) — — (67 )
Unrealized losses on guaranty assets and guaranty fee buy-ups
— — — — — — — — (342 ) — — (342 )
Amortization of net cash flow hedging gains
— — — — — — — — 1 — — 1
Prior service cost and actuarial gains, net of amortization for defined benefit plans
Total comprehensive loss
(64,946 )
Common stock dividends ($0.75 per share)
— — — — — — — (741 ) — — — (741 )
Senior preferred stock dividends
— — — — — — (31 ) — — — — (31 )
Common stock issued
— — 94 — — 49 2,477 — — — — 2,526
Common stock warrant issued
— — — — — — 3,518 — — — — 3,518
Preferred stock dividends declared
— — — — — — — (1,038 ) — — — (1,038 )
Senior preferred stock issued
1 — — 1,000 — — — — — — — 1,000
Preferred stock issued
— 141 — — 4,812 — (127 ) — — — — 4,685
Conversion of convertible preferred stock into common stock
— (10 ) 16 — (503 ) 8 495 — — — — —
Treasury commitment
— — — — — — (4,518 ) — — — — (4,518 )
— — 1 — — — (24 ) — — 168 — 144
1 597 1,085 1,000 21,222 650 3,621 (26,790 ) (7,673 ) (7,344 ) 157 (15,157 )
Cumulative effect from the adoption of a new accounting standard on other-than- temporary impairments, net of tax
— — — — — — — 8,520 (5,556 ) — — 2,964
— — — — — — — — — — (13 ) (13 )
Reclassification adjustment for gains included in net loss (net of tax of $119)
Unrealized gains on guaranty assets and guaranty fee buy-ups
— — — — — — — — 245 — — 245
Increase to senior preferred liquidation preference
— — — 59,900 — — — — — — — 59,900
— (17 ) 27 — (874 ) 14 860 — — — — —
— — 1 — — — 72 2 — (54 ) — 20
1 580 1,113 $ 60,900 $ 20,348 $ 664 $ 2,083 $ (90,237 ) $ (1,732 ) $ (7,398 ) $ 91 $ (15,281 )
Cumulative effect from the adoption of the accounting standards on transfers of financial assets and consolidation
— — — — — — — 6,706 (3,394 ) — (14 ) 3,298
Balance as of January 1, 2010, adjusted
1 580 1,113 60,900 20,348 664 2,083 (83,531 ) (5,126 ) (7,398 ) 77 (11,983 )
— — — — — — — — — — 9 9
— — — — — — — (14,014 ) — — (4 ) (14,018 )
Changes in net unrealized losses on available-for-sale securities, (net of tax of $1,644)
Reclassification adjustment for other-than- temporary impairments recognized in net loss (net of tax of $253)
— — — — — — (2,265 ) (5,441 ) — — — (7,706 )
— (3 ) 5 — (144 ) 3 141 — — — — —
— — 1 — — — 41 — — (4 ) — 37
1 577 1,119 $ 88,600 $ 20,204 $ 667 $ — $ (102,986 ) $ (1,682 ) $ (7,402 ) $ 82 $ (2,517 )
Supplemental Non-GAAP Consolidated Fair Value Balance Sheets
As of December 31, 2010 As of December 31, 2009(1)
Value Adjustment(2) Fair Value Value Adjustment(2) Fair Value
$ 80,975 $ — $ 80,975 $ 9,882 $ — $ 9,882
11,751 — 11,751 53,684 (28 ) 53,656
56,856 — 56,856 111,939 — 111,939
Mortgage loans held for sale
915 — 915 18,462 153 18,615
Mortgage loans held for investment, net of allowance for loan losses:
358,698 (39,331 ) 319,367 246,509 (5,209 ) 241,300
2,564,107 46,038 (3) 2,610,145 (4) 129,590 (45 ) 129,545 (4)
2,923,720 6,707 2,930,427 (5) 394,561 (5,101 ) 389,460 (5)
7,215 (225 ) 6,990 (6)(7) 5,449 (305 ) 5,144 (6)(7)
Derivative assets at fair value
1,137 — 1,137 (6)(7) 1,474 — 1,474 (6)(7)
Guaranty assets and buy-ups, net
458 356 814 (6)(7) 9,520 5,104 14,624 (6)(7)
Total financial assets
3,176,504 6,838 3,183,342 (8) 824,237 (330 ) 823,907 (8)
Master servicing assets and credit enhancements
479 3,286 3,765 (6)(7) 651 5,917 6,568 (6)(7)
44,989 (261 ) 44,728 (6)(7) 44,253 373 44,626 (6)(7)
$ 3,221,972 $ 9,863 $ 3,231,835 $ 869,141 $ 5,960 $ 875,101
$ 52 $ (1 ) $ 51 $ — $ — $ —
151,884 90 151,974 200,437 56 200,493
5,359 — 5,359 — — —
628,160 (9) 21,524 649,684 567,950 (9) 19,473 587,423
2,411,597 (9) 103,332 (3) 2,514,929 6,167 (9) 143 6,310
Derivative liabilities at fair value
1,715 — 1,715 (10)(11) 1,029 — 1,029 (10)(11)
Guaranty obligations
769 3,085 3,854 (10)(11) 13,996 124,586 138,582 (10)(11)
Total financial liabilities
3,199,536 128,030 3,327,566 (8) 789,579 144,258 933,837 (8)
24,953 (472 ) 24,481 (10)(11) 94,843 (54,878 ) 39,965 (10)(11)
3,224,489 127,558 3,352,047 884,422 89,380 973,802
Equity (deficit):
Senior preferred(12)
88,600 — 88,600 60,900 — 60,900
20,204 (19,829 ) 375 20,348 (19,629 ) 719
(111,403 ) (97,866 ) (209,269 ) (96,620 ) (63,791 ) (160,411 )
Total Fannie Mae stockholders' deficit/non-GAAP fair value of net assets
$ (2,599 ) $ (117,695 ) $ (120,294 ) $ (15,372 ) $ (83,420 ) $ (98,792 )
82 — 82 91 — 91
(2,517 ) (117,695 ) (120,212 ) (15,281 ) (83,420 ) (98,701 )
See Explanation and Reconciliation of Non-GAAP Measures to GAAP Measures
Explanation and Reconciliation of Non-GAAP Measures to GAAP Measures
(1) Certain prior period amounts have been reclassified to conform to the current period presentation.
(2) Each of the amounts listed as a "fair value adjustment" represents the difference between the carrying value included in our GAAP consolidated balance sheets and our best judgment of the estimated fair value of the listed item.
(3) Fair value exceeds the carrying value of consolidated loans and debt of consolidated trusts due to the fact that the loans and debt were consolidated in our GAAP consolidated balance sheet at unpaid principal balance at transition. Also impacting the difference between fair value and carrying value of the consolidated loans is the credit component of the loan. This credit component is reflected in the net guaranty obligation, which is included in the consolidated loan fair value, but was presented as a separate line item in our fair value balance sheet in prior periods.
(4) Includes certain mortgage loans that we elected to report at fair value in our GAAP consolidated balance sheet of $3.0 billion as of December 31, 2010. We did not elect to report any mortgage loans at fair value in our consolidated balance sheet as of December 31, 2009.
(5) Performing loans had a fair value of $2.8 trillion and an unpaid principal balance of $2.7 trillion as of December 31, 2010 compared to a fair value of $345.5 billion and an unpaid principal balance of $348.2 billion as of December 31, 2009. Nonperforming loans, which include loans that are delinquent by one or more payments, had a fair value of $168.5 billion and an unpaid principal balance of $287.4 billion as of December 31, 2010 compared to a fair value of $43.9 billion and an unpaid principal balance of $79.8 billion as of December 31, 2009. See "Note 19, Fair Value" for additional information on valuation techniques for performing and non performing loans.
(6) The following line items: (a) Advances to lenders; (b) Derivative assets at fair value; (c) Guaranty assets and buy-ups, net; (d) Master servicing assets and credit enhancements and (e) Other assets, together consist of the following assets presented in our GAAP consolidated balance sheets: (a) Total accrued interest receivable, net of allowance; (b) Acquired property, net; (c) Servicer and MBS trust receivable; and (d) Other assets.
(7) "Other assets" include the following GAAP consolidated balance sheets line items: (a) Total accrued interest receivable, net of allowance; (b) Acquired property, net; and (c) Servicer and MBS trust receivable. The carrying value of these items in our GAAP consolidated balance sheets totaled $28.4 billion and $31.2 billion as of December 31, 2010 and 2009, respectively. "Other assets" in our GAAP consolidated balance sheets includes the following: (a) Advances to Lenders; (b) Derivative assets at fair value; (c) Guaranty assets and buy-ups, net; and (d) Master servicing assets and credit enhancements. The carrying value of these items totaled $9.3 billion and $17.1 billion as of December 31, 2010 and 2009, respectively.
(8) We determined the estimated fair value of these financial instruments in accordance with the fair value accounting standard as described in "Note 19, Fair Value."
(9) Includes certain long-term debt instruments that we elected to report at fair value in our GAAP consolidated balance sheets of $3.2 billion and $3.3 billion as of December 31, 2010 and 2009, respectively.
(10) The following line items: (a) Derivative liabilities at fair value; (b) Guaranty obligations; and (c) Other liabilities, consist of the following liabilities presented in our GAAP consolidated balance sheets: (a) Accrued interest payable of Fannie Mae; (b) Accrued interest payable of consolidated trusts; (c) Reserve for guaranty losses; (d) Servicer and MBS trust payable; and (e) Other liabilities.
(11) "Other liabilities" include the following GAAP consolidated balance sheets line items: (a) Accrued interest payable of Fannie Mae; (b) Accrued interest payable of consolidated trusts; (c) Reserve for guaranty losses; and (d) Servicer and MBS trust payable. The carrying value of these items in our GAAP consolidated balance sheets totaled $17.0 billion and $85.3 billion as of December 31, 2010 and 2009, respectively. We assume that certain other liabilities, such as deferred revenues, have no fair value. Although we report the "Reserve for guaranty losses" as a separate line item in our consolidated balance sheets, it is incorporated into and reported as part of the fair value of our guaranty obligations in our non-GAAP supplemental consolidated fair value balance sheets. "Other liabilities" in our GAAP consolidated balance sheets include the following: (a) Derivative liabilities at fair value and (b) Guaranty obligations. The carrying value of these items totaled $2.5 billion and $15.0 billion as of December 31, 2010 and 2009, respectively.
(12) The amount included in "estimated fair value" of the senior preferred stock is the liquidation preference, which is the same as the GAAP carrying value, and does not reflect fair value.
February 24, 2011 Fannie Mae 2010 Credit Supplement
This presentation includes information about Fannie Mae, including information contained in Fannie Mae's Annual Report on Form 10-K for the year ended December 31, 2010, the "2010 Form 10-K." Some of the terms used in these materials are defined and discussed more fully in the 2010 Form 10-K. These materials should be reviewed together with the 2010 Form 10-K, copies of which are available in the "Investor Information" section of Fannie Mae's Web site at www.fanniemae.com. Some of the information in this presentation is based upon information that we received from third-party sources such as sellers and servicers of mortgage loans. Although we generally consider this information reliable, we do not independently verify all reported information. This presentation includes forward-looking statements relating to future home price changes. These statements are based on our opinions, analyses, estimates, forecasts and other views on a variety of economic and other information, and changes in the assumptions and other information underlying these views could produce materially different results. The impact of future home price changes on our business, results or financial condition will depend on many other factors. Due to rounding, amounts reported in this presentation may not add to totals indicated (or 100%).
Table of Contents Slide Home Price Growth/Decline Rates in the U.S. 3 Home Price Declines Peak-to-Current (by State) as of 2010 Q4 4 Fannie Mae Acquisition Profile by Key Product Features 5 Fannie Mae Credit Profile by Key Product Features 6 Fannie Mae Credit Profile by Origination Year and Key Product Features 7 Fannie Mae Single-Family Cumulative Default Rates 8 Fannie Mae Credit Profile by State 9 Fannie Mae Single-Family Serious Delinquency Rates by State and Region 10 Home Price Growth/Decline and Fannie Mae Real Estate Owned (REO) in Selected States 11 Fannie Mae Alt-A Credit Profile by Key Product Features 12 Fannie Mae Alt-A Loans Versus Loans Underlying Private-Label Alt-A Securities 13 Fannie Mae Workouts by Type 14 Home Affordable Modification Program (HAMP) 15 Fannie Mae Modifications of Single-Family Delinquent Loans 16 Fannie Mae Multifamily Credit Profile by Loan Attributes 17 Fannie Mae Multifamily Credit Profile by Acquisition Year 18 Fannie Mae Multifamily Credit Profile by Region and State 19 Fannie Mae Multifamily Credit Profile by State 20
Home Price Growth/Decline Rates in the U.S. Note: Our estimates differ from the S&P/Case-Shiller index in two principal ways: (1) our estimates weight expectations for each individual property by number of properties, whereas we believe the S&P/Case-Shiller index weights expectations of home price declines based on property value, causing declines in home prices on higher priced homes to have a greater effect on the overall result; and (2) our estimates attempt to exclude sales of foreclosed homes because we believe that differing maintenance practices and the forced nature of the sales make foreclosed home prices less representative of market values, whereas we believe the S&P/Case-Shiller index includes sales of foreclosed homes. The S&P/Case Shiller comparison numbers shown above for the peak-to-trough forecast are calculated using our models and assumptions, but modified to account for weighting based on property value and the impact of foreclosed property sales. In addition to these differences, our estimates are based on our own internally available data combined with publicly available data, and are therefore based on data collected nationwide, whereas the S&P/Case-Shiller index is based on publicly available data, which may be limited in certain geographic areas of the country. Our comparative calculations to the S&P/Case-Shiller index provided above are not modified to account for this data pool difference. S&P/Case-Shiller Index 9.8% 7.7% 10.6% 10.7% 14.6% 14.7% -0.3% -8.4% -18.4% -2.4% -4.1% Fannie Mae Home Price Index Growth rates are from period-end to period-end. Estimate based on purchase transactions in Fannie-Freddie acquisition and public deed data available through the end of January 2011. Including subsequently available data may lead to materially different results. We expect peak-to-trough declines in home prices to be in the 21% to 26% range (comparable to a decline of 32% to 40% range using the S&P/Case-Shiller index method).
Home Price Declines Peak-to-Current (by State) as of 2010 Q4* Top %: State/Region Home Price Decline Rate percentage from applicable peak in that state through December 31, 2010 Bottom %: Percent of Fannie Mae single-family conventional guaranty book of business by unpaid principal balance as of December 31, 2010 Note: Regional home price decline percentages are a housing stock unit-weighted average of home price decline percentages of states within each region. * Source: Fannie Mae. Estimate based on purchase transactions in Fannie-Freddie acquisition and public deed data available through the end of January 2011. Including subsequent data may lead to materially different results.
Fannie Mae Acquisition Profile by Key Product Features Credit Characteristics of Single-Family Business Volume (1) Percentage calculated based on unpaid principal balance of loans at time of acquisition. Single-family business volume refers to both single-family mortgage loans we purchased for our mortgage portfolio and single-family mortgage loans we securitized into Fannie Mae MBS. The increase for 2010 is the result our Refi Plus TM initiative, which involves the refinance of existing Fannie Mae loans with loan-to-value ratios up to 125%. Refi Plus and Home Affordable Refinance Program (HARP) started in April 2009. (4) FICO Credit scores as reported by the seller of the mortgage loan at the time of delivery. Represented as a percentage of total unpaid principal balance of loans at time of acquisition.
Fannie Mae Credit Profile by Key Product Features Credit Characteristics of Single-Family Conventional Guaranty Book of Business (1) Loans with multiple product features are included in all applicable categories. The subtotal is calculated by counting a loan only once even if it is included in multiple categories. (2) Excludes non-Fannie Mae securities held in portfolio and those Alt-A and subprime wraps for which Fannie Mae does not have loan-level information. Fannie Mae had access to detailed loan-level information for over 99% of its single-family conventional guaranty book of business as of December 31, 2010. (3) FICO Credit scores as reported by the seller of the mortgage loan at the time of delivery. (4) Unpaid principal balance of all loans with credit enhancement as a percentage of unpaid principal balance of single-family conventional guaranty book of business for which Fannie Mae had access to loan level information. Includes primary mortgage insurance, pool insurance, lender recourse and other credit enhancement. (5) Expressed as a percentage of credit losses for the single-family guaranty book of business. For information on total credit losses, refer to Fannie Mae's 2010 Form 10-K. (6) Negative Amortizing Loans contributed to a recovery of previously realized credit losses in the fourth quarter of 2010 as a result of an agreement we entered into during the quarter with a seller/servicer to address outstanding loan repurchase requests and the lender's cash payment to us under the agreement.
Fannie Mae Credit Profile by Origination Year and Key Product Features (1) Excludes non-Fannie Mae securities held in portfolio and those Alt-A and subprime wraps for which Fannie Mae does not have loan-level information. Fannie Mae had access to detailed loan-level information for over 99% of its single-family conventional guaranty book of business as of December 31, 2010. (2) The increase for 2010 is the result of Refi Plus loans, which started in April 2009, and can have loan-to-value ratios up to 125%. (3) FICO Credit scores as reported by the seller of the mortgage loan at the time of delivery. (4) Unpaid principal balance of all loans with credit enhancement as a percentage of unpaid principal balance of single-family conventional guaranty book of business for which Fannie Mae has access to loan-level information. Includes primary mortgage insurance, pool insurance, lender recourse and other credit enhancement. (5) Expressed as a percentage of credit losses for the single-family guaranty book of business. For information on total credit losses, refer to Fannie Mae's 2010 Form 10-K. (6) Defaults include loan liquidations other than through voluntary pay-off or repurchase by lenders and include loan foreclosures, preforeclosure sales, sales to third parties and deeds in lieu of foreclosure. Cumulative Default Rate is the total number of single-family conventional loans in the guaranty book of business originated in the identified year that have defaulted, divided by the total number of single-family conventional loans in the guaranty book of business originated in the identified year. For 2000 to 2004 cumulative default rates, refer to slide 8. Credit Characteristics of Single-Family Conventional Guaranty Book of Business by Origination Year
Note: Defaults include loan liquidations other than through voluntary pay-off or repurchase by lenders and include loan foreclosures, preforeclosure sales, sales to third parties and deeds in lieu of foreclosure. Cumulative Default Rate is the total number of single-family conventional loans in the guaranty book of business originated in the identified year that have defaulted, divided by the total number of single-family conventional loans in the guaranty book of business originated in the identified year. Data as of December 31, 2010 are not necessarily indicative of the ultimate performance of the loans and performance is likely to change, perhaps materially, in future periods. Fannie Mae Single-Family Cumulative Default Rates Cumulative Default Rates of Single-Family Conventional Guaranty Book of Business by Origination Year
Fannie Mae Credit Profile by State Credit Characteristics of Single-Family Conventional Guaranty Book of Business by State (1) Excludes non-Fannie Mae securities held in portfolio and those Alt-A and subprime wraps for which Fannie Mae does not have loan-level information. Fannie Mae had access to detailed loan-level information for over 99% of its single-family conventional guaranty book of business as of December 31, 2010. (2) FICO Credit scores as reported by the seller of the mortgage loan at the time of delivery. (3) Unpaid principal balance of all loans with credit enhancement as a percentage of unpaid principal balance of single-family conventional guaranty book of business for which Fannie Mae has access to loan-level information. Includes primary mortgage insurance, pool insurance, lender recourse and other credit enhancement. (4) Expressed as a percentage of credit losses for the single-family guaranty book of business. For information on total credit losses, refer to Fannie Mae's 2010 Form 10-K. (5) Select Midwest states are Illinois, Indiana, Michigan and Ohio.
Fannie Mae Single-Family Serious Delinquency Rates by State and Region (1) (1) Calculated based on the number of loans in Fannie Mae's single-family conventional guaranty book of business within each specified category. (2) Select Midwest states are Illinois, Indiana, Michigan and Ohio. (3) For information on which states are included in each region, refer to Fannie Mae's 2010 Form 10-K.
Home Price Growth/Decline and Fannie Mae Real Estate Owned (REO) in Selected States (1) Based on Fannie Mae Home Price Index. Estimate based on purchase transactions in Fannie-Freddie acquisition and public deed data available through the end of January 2011. Including subsequently available data may lead to materially different results. (2) Select Midwest states are Illinois, Indiana, Michigan and Ohio.
Fannie Mae Alt-A Credit Profile by Key Product Features Credit Characteristics of Alt-A Single-Family Conventional Guaranty Book of Business by Origination Year (1) "Alt-A mortgage loan" generally refers to a mortgage loan that can be underwritten with reduced or alternative documentation than that required for a full documentation mortgage loan but may also include other alternative product features. In reporting our Alt-A exposure, we have classified mortgage loans as Alt-A if the lenders that deliver the mortgage loans to us have classified the loans as Alt-A based on documentation or other product features. We have classified private-label mortgage-related securities held in our investment portfolio as Alt-A if the securities were labeled as such when issued. (2) Newly originated Alt-A loans acquired in 2009 and 2010 consist of the refinance of existing Alt-A loans under our Refi Plus Initiative. (3) Excludes non-Fannie Mae securities held in portfolio and those Alt-A and subprime wraps for which Fannie Mae does not have loan-level information. Fannie Mae had access to detailed loan-level information for over 99% of its single-family conventional guaranty book of business as of December 31, 2010. (4) The increase for 2009 and 2010 is the result of Refi Plus loans, which started in April 2009 and can have loan-to-value ratios up to 125%. (5) FICO Credit scores as reported by the seller of the mortgage loan at the time of delivery. (6) Defined as unpaid principal balance of Alt-A loans with credit enhancement as a percentage of unpaid principal balance of all Alt-A loans. At December 31, 2010,10.2% of unpaid principal balance of Alt-A loans carried only primary mortgage insurance (no deductible), 6.5% had only pool insurance (which is generally subject to a deductible), 1.2% had primary mortgage insurance and pool insurance, and 0.4% carried other credit enhancement such as lender recourse. (7) Expressed as a percentage of credit losses for the single-family guaranty book of business. For information on total credit losses, refer to Fannie Mae's 2010 Form 10-K. (8) Defaults include loan liquidations other than through voluntary pay-off or repurchase by lenders and includes loan foreclosures, preforeclosure sales, sales to third parties and deeds in lieu of foreclosure. Cumulative Default Rate is the total number of single-family conventional loans in the guaranty book of business originated in the identified year that have defaulted, divided by the total number of single-family conventional loans in the guaranty book of business originated in the identified year.
Fannie Mae Alt-A Loans Versus Loans Underlying Private-Label Alt-A Securities Includes first liens and any subordinate liens present at origination. The Cumulative Default Rate is based upon the number of months between the loan origination month/year and default month/year. (3) Due to low amount of Alt-A loans originated in 2008, 2009 and 2010, no comparable data has been provided for these years. Data as of November 2010 are not necessarily indicative of the ultimate performance of the loans and performance is likely to change, perhaps materially, in future periods. Note: Private-label securities data source: First American CoreLogic, LoanPerformance data, which estimates it captures 97% of Alt-A private-label securities.
Fannie Mae Workouts by Type Modifications involve changes to the original mortgage loan terms, which may include a change to the product type, interest rate, amortization term, maturity date and/or unpaid principal balance. Modifications include completed modifications made under the Administration's Home Affordable Modification Program, which was implemented in March 2009, but do not reflect loans currently in trial modifications. Information on Fannie Mae loans under the Home Affordable Modification Program is provided on Slide 15. Repayment plans involve plans to repay past due principal and interest over a reasonable period of time through temporarily higher monthly payments. Loans with completed repayment plans are included for loans that were at least 60 days delinquent at initiation. Forbearances involve an agreement to suspend or reduce borrower payments for a period of time. Loans with forbearance plans are included for loans that were at least 90 days delinquent at initiation. Deeds in lieu of foreclosure involve the borrower's voluntarily signing over title to the property without the added expense of a foreclosure proceeding. In a preforeclosure sale, the borrower, working with the servicer, sells the home prior to foreclosure to pay off all or part of the outstanding loan, accrued interest and other expenses from the sale proceeds. HomeSaver Advance TM are unsecured, personal loans designed to help qualified borrowers bring their delinquent mortgage loans current after a temporary financial difficulty. TM
Provides immediate payment relief to borrowers who are delinquent or in imminent risk of payment default. We require servicers to first evaluate all Fannie Mae problem loans for HAMP eligibility. If a borrower is not eligible for HAMP, our servicers are required to exhaust all other workout alternatives before proceeding to foreclosure. Home Affordable Modification Program (HAMP) (1) Active Permanent HAMP modifications exclude modifications on loans that subsequently canceled because the loans were 90+ days delinquent or have paid off. (2) Re-performance rates for modified single-family loans, including permanent HAMP modifications, are presented on Slide 16. Data Source: United States Treasury Department as reported by servicers to the system of record for the Home Affordable Modification Program. Fannie Mae Loans Under HAMP
Fannie Mae Modifications of Single-Family Delinquent Loans Change in Monthly Principal and Interest Payment of Modified Single-Family Loans(1)(2) Excludes loans that were classified as subprime adjustable rate mortgages that were modified into fixed rate mortgages and were current at the time of modification. Modifications include permanent modifications started under the Administration's Home Affordable Modification Program, which was implemented beginning in March 2009, but do not reflect loans currently in trial modifications. Information on the Home Affordable Modification Program is provided on Slide 15. Represents the change in the monthly principal and interest payment at the effective date of the modification. The monthly principal and interest payment on modified loans may vary, and may increase, during the remaining life of the loan. Includes loans that paid off. Re-performance Rates of Modified Single-Family Loans(1)
Fannie Mae Multifamily Credit Profile by Loan Attributes Excludes loans that have been defeased. Defeasance is prepayment of a loan through substitution of collateral. We classify multifamily loans as seriously delinquent when payment is 60 days or more past due. Weighted Average Original loan-to-value ratio is 67% as of December 31, 2010. Under the Delegated Underwriting and Servicing, or DUS (r), product line, Fannie Mae purchases individual, newly originated mortgages from specially approved DUS lenders using DUS underwriting standards and/or DUS loan documents. Because DUS lenders generally share the risk of loss with Fannie Mae, they are able to originate, underwrite, close and service most loans without our pre-review. Multifamily loans under $3 million and up to $5 million in high income areas.
Fannie Mae Multifamily Credit Profile by Acquisition Year Excludes loans that have been defeased. Defeasance is prepayment of a loan through substitution of collateral. We classify multifamily loans as seriously delinquent when payment is 60 days or more past due. Cumulative Defaults by Acquisition Year Multifamily SDQ Rate by Acquisition Year
Fannie Mae Multifamily Credit Profile by Region and State Excludes loans that have been defeased. Defeasance is prepayment of a loan through substitution of collateral. We classify multifamily loans as seriously delinquent when payment is 60 days or more past due. For information on which states are included in each region, refer to the 2010 Form 10-K. Asset Class Definitions: Conventional/Co-Op Housing: Privately owned multifamily properties that receive no public subsidies or a multifamily property in which the residents collectively own the property through their shares in the cooperative corporation. Seniors Housing: Multifamily rental properties for senior citizens. Manufactured Housing: a residential real estate development consisting of housing sites for manufactured homes, related amenities, utility services, landscaping, roads and other infrastructure. Student Housing: Multifamily rental properties in which 80% or more of the units are leased to undergraduate and/or graduate students. The multifamily affordable business channel focuses on financing properties which are under a regulatory agreement that provides long term affordability, such as properties with rent subsidies or income restrictions.
Fannie Mae Multifamily Credit Profile by State UPB as of 12/31/2010 Example: UPB in New York is greater than $10B and 2010 Credit Losses were $4M Numbers: Represent 2010 Credit Losses for each state. States with no numbers had less than $1 million in credit losses in 2010 Shading: Represent Unpaid Principle Balance (UPB) as of December 31, 2010 for each state. Excludes loans that have been defeased. Defeasance is prepayment of a loan through substitution of collateral.


text:
Two Big Investors Ask Apple To Address Youth Phone Addiction
Posted By: Aman Jain Jan 8, 2018, 9:30 am
Two big Apple shareholders have asked the company to help curtail phone addiction among children. The investors are concerned that the iPhone's entrancing qualities are fostering a public health crisis, which could be negative for kids and the company as well.
JESHOOTS / Pixabay
Apple investors concerned over excessive iPhone use
In a letter (shared online), Apple Inc. (NASDASQ:AAPL) investors Jana Partners and the California State Teachers' Retirement System (CalSTRS), said there is evidence that the smartphone habit could impact the health of youth.
"There is a growing body of evidence that, for at least some of the most frequent young users, this may be having unintentional negative consequences," the letter read. The "growing societal unease … at some point is likely to impact even Apple."
The investors further argue that this social unease could impact Apple as well, and addressing the phone addiction now could help company's shares.
"Addressing this issue now will enhance long-term value for all shareholders," the letter read.
Jana is a leading activist shareholder while CalSTRS is one of the nation's largest public pension plans. Together, both the investors own about $2 billion in Apple shares. In the letter delivered Saturday, Apple investors have asked the company to develop some software which would allow parents to restrict the use of smartphones among children, reported the Wall Street Journal.
Further, the letter proposes that Apple should introduce software changes like allowing parents to set a limit on the number of hours, and/or the social platforms that the kids can access. Parents could also get an option to monitor how the iPhone is used.
Apple investors have also asked the company to study the impact that excessive use of the smartphone has on the mental health of the young. Other suggestions include active monitoring of the issue by Apple executives, and producing an annual report on the topic, similar to how the company does for the diversity and labor.
Apple already gives users some parental restrictions. However, these restrictions mostly control the ability of the kids to purchase the apps, access offensive content, or use of features such as location sharing.
Phone addiction – a growing issue
Smartphone addiction among young people is a growing concern in the U.S. as more and more parents report the issue with their children. A 2016 survey of children and their parents by Common Sense Media claims that half of the teenagers in the U.S. feel they are addicted to their phone and always feel the urge to respond to phone messages immediately, notes Reuters.
"It's not an exaggeration to describe iGen as being on the brink of the worst mental-health crisis in decades," said Jean Twenge, a psychology professor at San Diego State University, in an article in The Atlantic last year. "Much of this deterioration can be traced to their phones."
The issue was highlighted after the former Disney child star, Selena Gomez, said she went to therapy for depression and low self-esteem. Gomez, 24, linked those feelings to her smartphone addiction. Also, governments in several countries are taking the issue seriously, notes Fortune. For example, in France, use of the smartphone is banned in the primary and middle schools.
Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at amanjain@valuewalk.com
Ranked: Top 10 most advertised brands in the US

redpajama_set_name: RedPajamaCommonCrawl


Webcam Lipno nad Vltavou, Czech Republic - 5.5 miles from Bedrichov: Lipensko - A live view from Lipno.
Webcam Cesky Krumlov, Czech Republic - 8.4 miles from Bedrichov: Panorama Webcam - Changing images are showing the city of Cesky Krumlov, Czech Republic.
Webcam Ulrichsberg, Austria - 13.5 miles from Bedrichov: Schöneben - A live view from Ulrichsberg.
Webcam Klaffer am Hochficht, Austria - 14.6 miles from Bedrichov: Hochficht - A live view from the Hochficht at Klaffer am Hochficht.
Webcam Klaffer am Hochficht, Austria - 14.6 miles from Bedrichov: Summit Station - A live view from Klaffer am Hochficht.
Webcam Klaffer am Hochficht, Austria - 14.6 miles from Bedrichov: Skiarena Hochficht - A live view from Klaffer am Hochficht.
Webcam Waxenberg, Austria - 16.6 miles from Bedrichov: Ruin Waxenberg - A view of the ruin of Waxenberg, with current infos and photos of the region.
Webcam Haibach ob der Donau, Austria - 24.9 miles from Bedrichov: Schlögener Donauschlinge - A nice view over the 'Donauschlinge' at Schlögen, Austria.
Webcam Grainet, Germany - 25.5 miles from Bedrichov: Hotel Hüttenhof - View onto Grainet from the Hotel Hüttenhof.
Webcam Engelhartszell, Austria - 25.8 miles from Bedrichov: PANOMAX Engelhartszell - Penzenstein - A splendid panorama view.


Summary: Best answers are offered here to tell you how to easily convert MKV file to Apple TV for a playback.
With the release of Apple TV, it gives you anytime access to endless entertainment. Thousands of videos and TV shows can be shown on your widescreen TV. What a delightful thing if MKV file can be played on Apple TV! If you have searched the Apple TV official website, we will find that the biggest limitation of Apple TV is the lack of some codec support and not even having the ability to do basic surround sound like Dolby Digital 5.1. These issues were resolved almost immediately after the Apple TV was released, although the hacks were somewhat less than practical. Something as simple as getting your Apple TV to, say, sync and recognize your movies as playable was no simple feat.
Have tried directly syncing MKV file to Apple TV, but failed? No worry, problems can be solved as long as you convert MKV file to Apple TV supported formats. We also have discussed related XviD/Divx to Apple TV, TiVo files to Apple TVand etc. issues.
Here we list the Apple TV supported file types according to our multiple-testing result.
Compared with others, we have found the Pavtube Video Converter for Mac has the strong ability of transcoding MKV files well. This program offers quite effective solution for you to convert almost all the videos MKV as well as Xvid, DivX, MOV, MTS, TiVo, VOB, etc. It also allows you to adjust the video, audio parameter to get a decent output video that you want. Barely several steps are enough. Just download it and follow the steps below.
How to play MKV file on Apple TV?
Step 1: Download and have a quick installation. The trial version will have a watermark on your converted files. Except for that, there are no time limitation, no virus, and no unnecessary bundle apps while downloading. After that, click "Add Video" button to load your MKV files. You can load several files at once thanks to "Add from folder" button.
Step 2: Select the right formats for playing on Apple TV. Here we suggest you to go to the "HD Video" list, you will get the "H.264 HD Video (*.mp4)" as the best output.
Step 4: Click "Convert" button to start MKV video to H.264 HD Video MP4 conversion for Apple TV playing. You can get the generated files by clicking "Open" button.
Conclusion: If you don't want to wait for the entire conversion process, you can tick off "Showdown computer when conversion completed" and go away to do other things. If you are fond of enjoying MKV files on Apple TV, why not have a try? Enjoy streaming MKV files to Apple TV!


text:
Witless Ape Rides Escalator
About Kevin D. Williamson
(Nicholas Kamm/AFP/Getty)
Donald Trump is in the race.
Donald Trump may be the man America needs. Having been through four bankruptcies, the ridiculous buffoon with the worst taste since Caligula is uniquely positioned to lead the most indebted organization in the history of the human race.
The Trump conglomerate is the Argentina of limited-liability companies, having been in bankruptcy as recently as 2009. To be sure, a lot of companies went bankrupt around then. The Trump gang went bankrupt in 2004, too, and in 2001. Before that, Trump was in bankruptcy court back in 1991 when his Taj Mahal casino in Atlantic City — the nation's first casino-cum-strip-club, an aesthetic crime against humanity that is tacky by the standards of Atlantic City — turned out to be such a loser that Trump could not make his debt payments.
The closing of that casino has been announced at least twice — it was supposed to shut its doors in December, but it limps on.
RELATED: Donald Trump, America's Icon of Accountability
Donald Trump, being Donald Trump, announced his candidacy at Trump Tower, making a weird grand entrance via escalator — going down, of course, the symbolism of which is lost on that witless ape. But who could witness that scene — the self-made man who started with nothing but a modest portfolio of 27,000 New York City properties acquired by his millionaire slumlord father, barely out of his latest bankruptcy and possibly headed for another one as the casino/jiggle-joint bearing his name sinks into the filthy mire of the one U.S. city that makes Las Vegas look respectable, a reality-television grotesque with his plastic-surgery-disaster wife, grunting like a baboon about our country's "brand" and his own vast wealth — and not see the peerless sign of our times?
On the substance, Trump is — how to put it gently? Oh, why bother! — an ass.
On the substance, Trump is — how to put it gently? Oh, why bother! — an ass. Not just an ass, but an ass of exceptionally intense asininity. China? "China's leaders are like Tom Brady, and the U.S. is like a high-school football team," Trump says. And so, we should do what?
" . . . "
Trump's is a fill-in-the-blanks agenda: He claims to have a plan for defeating ISIS, but he cannot say what it is for reasons of operational security for the mission that exists only in his mind. He assures us the plan is "foolproof," but whoever coined that word had never met a fool like Donald Trump. Immigration? Build a wall and force the Mexicans to pay for it.
How to do that?
The one thing worse than Trump's vague horsepucky is his specific horsepucky, i.e., his 1999 plan to impose a one-time tax — everybody knows how good Washington is about "one time" uses of power — on the wealth of all high-net-worth individuals and institutions. A 14.25 percent tax, he calculated, would retire the national debt. And what about institutions that don't have 14.25 percent of their net worth in ready cash — to take a totally random example, let's say a poorly run real-estate concern with a lot of illiquid assets and unmanageable debt payments eating up all its ready cash?
Trump says that he cannot discuss the details of his agenda because of — his word — "enemies." Who are these enemies?
Perspective? Trump predicted that we may be heading toward a stock-market crash worse than the one in 1929, but: "I remain extremely optimistic about Atlantic City."
We've been to this corner of Crazytown before. If we're going to have a billionaire dope running for the presidency, I prefer Ross Perot and his cracked tales of Vietnamese hit squads dispatched to take him out while Lee Atwater plotted to crash his daughter's wedding with phonied-up lesbian sex pictures.
RELATED: Donald Trump's Yuuge Hypocrisy
I have a theory about Trump and his delusions, based, I'll admit, on pure superstition. There's an ancient belief, one that persists into our own time, that our names exert occult influence on our lives. And Trump's name, while potentially comical — "Don-John" — doesn't offer much in the way of scrying. But his father's middle name was — true fact — Christ. Fred Christ. Obama's arrival was announced by a man called Emanuel, but The Donald was brought into this world by Christ himself — Fred Christ. How could a man like that not have a messiah complex?
Of course, when Trump sings "How Great Thou Art," he sings it in a mirror.
The problem with messiah complexes is that there's no way to know whether you are going to rise on the third day unless somebody crucifies you. Trump has announced, and I say we get started on that.
— Kevin D. Williamson is National Review's roving correspondent.
Kevin D. Williamson is the roving correspondent for National Review and the author of The Smallest Minority: Independent Thinking in an Age of Mob Politics.


text:
FACT CHECK THIS: If you think Big Tech is out of control now, just wait
Big Stock
We've heard a lot of talk lately about the goals of Big Tech and the mainstream media. The Hunter Biden laptop story is a prime example. The majority of the media refused to report on it, and any outlet that actually reported on it — like the New York Post — was shut down by both Facebook and Twitter.
I am under attack daily. I have employees who have to devote almost their entire workday responding to and appealing efforts by social media to censor our posts. Case in point, Facebook tried to shut down our story that Joe Biden's ancestors were slave owners.
They used a fact-check to insist our story was false based on the actual fact Joe Biden's great grandfather didn't own slaves and that none of his ancestors fought for the Confederacy. Well guess what? We never said any of that!
What we did say was that Biden's great great great grandfather owned slaves and that they were passed down to his great great grandfather. We provided evidence that this was true, including federal and local documents from the time. One of the most respected genealogy firms in the country compiled the report. And we never said any of Biden's family fought for the Confederacy.
It's clear the fact-checkers didn't listen to what I actually said, nor did they read either the article from my website or the genealogy report. Instead, they labeled our story false based on the headline they saw and claims that other websites had made. This is fact-checking?
They eventually lifted their judgement after we pointed this out. They even made the following correction to the fact-check, verifying that our reporting was true:
Update: There are documents supporting the claim that one of Biden's 16 great-great-great-grandfathers, who was born in 1776 on the paternal side of his family tree, owned slaves, and one of those slaves was inherited by a great-great-grandfather when he was a child. Details can be found below.
I'm lucky enough to have staff who can monitor these things and respond as they happen, but how many smaller sites just don't have such resources? How many true stories are getting shut down and censored and nothing is ever being done about it? How much legitimate information out there have we missed due to this flawed fact-checking system?
It's not you're innocent until proven guilty. They've flipped the standard.
The way this game works is the fact-checkers declare guilt, the information is shut down, and the burden is on you to prove your innocence — if you can. It's not you're innocent until proven guilty. They've flipped the standard.
There are multiple "fact-checkers" out there these days, and both Silicon Valley and the mainstream media run to them to be judge, jury and executioner on what they deem "false information." One of them is NewsGuard, which recently listed 40 Facebook pages as "super-spreaders" of election misinformation.
And wouldn't you know, of course I'm on the list. This is the example they provided:
Oct. 10, 2020, post with a link to an article on Beck's website falsely claiming that "members of the Obama Administration and State Department wrote the playbook for Color Revolution in the streets" and that the Democrats' plan to overthrow the government "culminates on November 3rd."
In essence, this is exactly like the Joe Biden ancestor slave holder fact-check. They read a headline, cherry-pick a line or two they don't like — without fully reading nor listening to what was actually said — and then declare the whole thing false.
Literally everything that was said in that show was taken directly from members of the Obama Administration, Democrats and other people on both the left and right — in their own words. I then provided commentary on what all this could mean. Since when is pointing out facts — facts that are clearly sourced — and discussing what it all could mean now out of bounds? How is it "misinformation" to reveal what someone has said or done?
If that's the standard, how is it possible to warn anyone about anything? My job — from the very beginning — has been to point out the warning signs and connect the dots so that we can all be prepared for every possible outcome. My audience knows this. It's how you all knew the 2008 financial crisis was coming. It's how you knew the word "Caliphate" long before ISIS.
Let's look at NewsGuard's little example for a second. Here is their first quote they pulled out as "false":
Members of the Obama Administration and State Department wrote the playbook for Color Revolution in the streets.
Now again, the "fact-checkers" never said how this is false... the burden is on you to prove your innocence. But here's the problem... I've already done that! All you have to do is actually watch the show. This isn't my claim. Obama's Ambassador to Russia — Michael McFaul — literally wrote an academic paper on Color Revolutions and the steps needed to be successful. He called them the 7 Pillars.
In McFaul's own words (he wasn't your typical diplomat), this is what he said his specialty was:
Most of the specialists on Russia are diplomats, specialists in security, arms control. Or Russian culture. I'm neither. I can't quote Pushkin by heart. I'M AN EXPERT ON DEMOCRACY, ANTI-DICTATORIAL MOVEMENTS, REVOLUTIONS.
Kind of an odd thing to admit as an Ambassador in Eastern Europe while Color Revolutions were breaking out all over the world.
Again. All of this is sourced in detail. They wrote and said these things, not me.
In the show, if they would have watched it, they would have seen me go through each of the Color Revolution pillars. I showed you how all of that was happening. In very particular, the pillars reference organized oppositions ready to hit the streets during an election. This goes to the fact-checkers' second "false" claim that all of this "culminates on November 3rd."
All I'm doing is pointing out what they have said, what they have planned for, and the rules that they have played by in the past.
What have they planned for? I've been talking about their little wargame based on the report written by the Transition Integrity Project for weeks. Even the Washington Post has written about this for crying out loud. The wargame specifically mentions using street activists — that they admit will probably turn violent — on November 3rd.
The group that did the event — Fight Back Table — made it clear what would happen:
Occupy sh*t, hold space, and shut things down, not just on Election Day but for weeks.
I did not say these things... they did!
There are multiple left-wing groups organizing for street protests on November 3rd. Obama's Organizing For Action is heavily involved with a group called Indivisible who is right now planning over 200 protests on election day all across the country.
Groups like the Action Network have been helping. They were inspired by Occupy Wall Street. Occupy Wall Street was inspired by the Arab Spring. Keep that in mind as the founder of the Action Network recently said this:
In some ways, we've just been road testing everything for two years, building up to this moment.
Again, I sound like a broken record here, but... I did not say these things. THEY DID!
I hope none of this happens, but we need to know these things so we're not caught off guard.
These are the rules they play by. Color Revolution is their specialty. It's their inspiration. Now they're organizing for election day. I said during my show that I hope none of this happens, but we need to know these things so we're not caught off guard if it does. It's the same reason I was warning about Osama Bin Laden before 9/11, the same reason I warned about the financial crisis before 2008, and the same reason I warned about the Caliphate before ISIS. I hoped none of them would happen but I wanted everyone to be prepared if it did.
If Big Tech has its way, if the "fact-checkers" can label things like this as "fake news" or "misleading," if we can't take people's own actions, words and plans at face value, inform about it and provide commentary on what people might need to be prepared for... we're screwed.
I have probably the most transparent show in the country. I provide all documentation for everything I do. I use the source material in every show. It's all right there. All the fact-checkers have to do is simply look at it.
This is what we're up against and it's only going to get worse. If Joe Biden wins on Tuesday, they're going to turn the dial up until we all melt.


The Rope allows you to achieve maximum throwing distance. Consists of high quality pure Rubber. This is a toy you and your dog will Love!! This toy does NOT Squeak!
Do you have experience with Tuffy`s Dog Toys Tuffy`s Rugged Rubber Grenade Chew Toy?


text:
Angela Marie "Bay" Buchanan (n. 23 de diciembre de 1948) fue la tesorera de los Estados Unidos durante la administración del presidente Ronald Reagan y fue la persona más joven en ser Secretaria del Tesoro, a la edad de 32 años. Estuvo en el cargo desde el 17 de marzo de 1981 hasta el 5 de julio de 1983. Es la hermana de Patrick J. Buchanan y estuvo encargada de sus tres campañas para la nominación presidencial de Estados Unidos. Después de aparecer regularmente en el programa de noticias "Inside Politics" de CNN, se convirtió en comentadora del mismo canal en el programa The Situation Room.

Bibliografía
 Buchanan, Bay. (2007)The Extreme Makeover of Hillary (Rodham) Clinton, Regnery Publishing, ISBN 1-59698-507-0

Activistas contra la inmigración ilegal de Estados Unidos
Nacidos en Washington D. C.
Republicanos de Washington D. C.

redpajama_set_name: RedPajamaWikipedia