Reading Fannie Mae's Scary Cookbook
hxxp://www.nytimes.com/2004/09/26/business/yourmoney/26watch.html
Auszug:
Fannie Mae's regulator did not quantify how much of the company's hedges were accounted for improperly. But it did note that as of December 2003, the company recorded $12.2 billion in deferred losses relating to cash-flow hedges. If Fannie Mae has to record some or all of this against its retained earnings, which were $24.5 billion at the end of last year, its regulatory capital will suffer, the report noted dryly.
Which leads to another revelation that Fannie Mae's fans must now face: that the company is grossly undercapitalized. Its equity capital of roughly 2 percent is much lower than the 8 percent required of "A"-rated banks, according to Sean Egan of the Egan-Jones Ratings Company. "In the past Fannie has made the argument that it was very familiar with the mortgage market and therefore needs less equity," Mr. Egan said. "Our view is the lack of diversification argues for a greater level of equity."
...............
Also troubling is the fact that Fannie Mae's problems have implications for the entire mortgage market
..............
The software, the memo said, allowed a user "to manipulate factors to produce an array of recognition streams," which "strengthens the earnings management that is necessary when dealing with a volatile book of business."
This nugget means that Fannie Mae is probably not alone in playing fast and loose with financial reality.
Ein Unfall der vorbereitet ist und passieren wird - und wenn er passiert, dann werden die ausländischen Investoren außerhalb der USA nicht erfreut darüber sein.
Fannie Mae and the story that won't go way...
hxxp://www.nytimes.com/2004/09/28/business/...6365725-Q/xfGR9ZHwrUsKqZ0F4fZA
"...
Fannie Mae, the nation's largest mortgage buyer and a financial juggernaut ..., agreed yesterday to major changes in its accounting and management practices in an unusual deal reached after a week of negotiations with the company's federal regulator.
... accounting irregularities and earnings manipulation that helped enrich the company's senior executives and presented an apparently false portrait of Fannie Mae's financial well-being to the public.
... might be only the first of many changes at Fannie Mae.
Congress is also planning its own hearings on Fannie Mae.
...the ramifications could be significant, not only for the company itself, but for the entire mortgage market, ...
... questions currently swirling around Fannie Mae, ...
... a requirement that it add more than $5 billion in fresh funds to its capital reserve within the next nine months, ...
...the company may have to make enormous restatements as it revises previously issued financial results.
Fannie Mae, ... also agreed to recalculate the value of complex financial products it has used to hedge its overall exposure to interest rate risks since 2001 and to revise how it has accounted for some expenses.
A bevy of Wall Street firms, including J. P. Morgan Chase, helped structure and trade some of the disputed hedging products and are likely to come under S.E.C. scrutiny. J. P. Morgan declined to comment yesterday.
..."
Was geht da vor sich bei Fannie Mae und wie wird es dort weiter gehen? Dort taucht wieder der Name auf: JP Morgan - der Derivatekönig. Diese Nachrichten stehen nun schon seit einer Woche oder länger konstant in der Weltpresse. Ist es fair anzunehmen, das was wir hören, eine milde Version von der Realität ist?
hxxp://www.nytimes.com/2004/09/26/business/yourmoney/26watch.html
Auszug:
Fannie Mae's regulator did not quantify how much of the company's hedges were accounted for improperly. But it did note that as of December 2003, the company recorded $12.2 billion in deferred losses relating to cash-flow hedges. If Fannie Mae has to record some or all of this against its retained earnings, which were $24.5 billion at the end of last year, its regulatory capital will suffer, the report noted dryly.
Which leads to another revelation that Fannie Mae's fans must now face: that the company is grossly undercapitalized. Its equity capital of roughly 2 percent is much lower than the 8 percent required of "A"-rated banks, according to Sean Egan of the Egan-Jones Ratings Company. "In the past Fannie has made the argument that it was very familiar with the mortgage market and therefore needs less equity," Mr. Egan said. "Our view is the lack of diversification argues for a greater level of equity."
...............
Also troubling is the fact that Fannie Mae's problems have implications for the entire mortgage market
..............
The software, the memo said, allowed a user "to manipulate factors to produce an array of recognition streams," which "strengthens the earnings management that is necessary when dealing with a volatile book of business."
This nugget means that Fannie Mae is probably not alone in playing fast and loose with financial reality.
Ein Unfall der vorbereitet ist und passieren wird - und wenn er passiert, dann werden die ausländischen Investoren außerhalb der USA nicht erfreut darüber sein.
Fannie Mae and the story that won't go way...
hxxp://www.nytimes.com/2004/09/28/business/...6365725-Q/xfGR9ZHwrUsKqZ0F4fZA
"...
Fannie Mae, the nation's largest mortgage buyer and a financial juggernaut ..., agreed yesterday to major changes in its accounting and management practices in an unusual deal reached after a week of negotiations with the company's federal regulator.
... accounting irregularities and earnings manipulation that helped enrich the company's senior executives and presented an apparently false portrait of Fannie Mae's financial well-being to the public.
... might be only the first of many changes at Fannie Mae.
Congress is also planning its own hearings on Fannie Mae.
...the ramifications could be significant, not only for the company itself, but for the entire mortgage market, ...
... questions currently swirling around Fannie Mae, ...
... a requirement that it add more than $5 billion in fresh funds to its capital reserve within the next nine months, ...
...the company may have to make enormous restatements as it revises previously issued financial results.
Fannie Mae, ... also agreed to recalculate the value of complex financial products it has used to hedge its overall exposure to interest rate risks since 2001 and to revise how it has accounted for some expenses.
A bevy of Wall Street firms, including J. P. Morgan Chase, helped structure and trade some of the disputed hedging products and are likely to come under S.E.C. scrutiny. J. P. Morgan declined to comment yesterday.
..."
Was geht da vor sich bei Fannie Mae und wie wird es dort weiter gehen? Dort taucht wieder der Name auf: JP Morgan - der Derivatekönig. Diese Nachrichten stehen nun schon seit einer Woche oder länger konstant in der Weltpresse. Ist es fair anzunehmen, das was wir hören, eine milde Version von der Realität ist?
