merkhet

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This is interesting. @JonAPrior: Reps. Mulvaney, Fincher ask Lew and Watt about raising Fannie, Freddie capital levels, want response this month politico.pro/1L1JmoQ

Haha. Okay. Sometimes, it's hard to tell on the Internet. :)

I feel like some people might quibble with that re Sears & St. Joe, but, that aside, I think he's probably correct about Fannie & Freddie. (Except, I'm likely biased given my ownership of Fannie Preferred.)

Anyone have a theory for why Berkowitz is highlighting the Tim Howard amicus brief?

The real estate market got really hot when people didn't have to do this. ;) On the origination side, credit is getting tighter because nobody with a brain wants to make subprime loans (QM rules, reps and warranties, dramatic increases in the cost of servicing delinquent loans, etc.). On the inventory side, foreclosures are finally working their way through the system. --- Here's my opinion of the management of homebuilding stocks: The best - NVR Above average - TOL, LEN (especially the B shares) Average - Pulte Below average - KBH, AV Homes Bad - HOV Really bad - CHCI A year or two ago, it was easy to figure out the quality of the companies by simply looking at the return on assets. Toll Brothers and Lennar are at their 52-week lows.

Perry Appeal happens in April. Jacobs case has more filings to come in February.

One thought could be that they, like Abrams, think that this requires a new administration that isn't bound by commitment bias. Another thought could be, as others have pointed out, that people were really just using Fairholme's Court of Federal Claims discovery process to get evidence for other cases. It's unclear. Hope Berkowitz gives a little more color in his shareholder letter. In any case, the longer this drags out, the worse it is for the IRR. Hopefully, the Jacobs case goes faster.

Could be any number of things. I've been wondering the same on my end. Doesn't have to drag as long as it has so far -- so there's a question re why Berkowitz would agree to such a long time period.

Agree in all respects. Unless Steele moves for summary judgement, which is possible if the DE/VA certification comes back very strong, I would not bank on a ruling from Delaware by April 15. We should be focusing more on when we will hear about the certification. IMHO, if that comes back in our favor (which is what I'm expecting), winning the Delaware case is a foregone conclusion.

Joint Status Report pushed to the 28th http://gselinks.com/Court_Filings/Fairholme/13-465-0282.pdf

would have liked to see it clearly stated here that NWS is not an exercise of power to transfer because the power to transfer does not permit issuance of stock that conflict with delaware corporate law, but I guess that would be redundant because he makes that point indirectly prior to this section. thanks for your thoughts Legal briefs often follow a particular template where the lawyer argues "this is wrong because (A)," "but even if you think that (A) is permissible, it is still wrong under (B)," etc.

This is the Delaware case, Jacobs.

Balls. I will not be in town that day for the oral arguments. :( how do you get into audience? just wait in line morning of? Yup. That's how it's worked for the Court of Federal Claims so far -- except when the status conferences are sealed. @onyx, I would look at the 99% vs 100% issue in the context of Steele's arguments about expropriation of value for the majority. The two (rates/preference and fiduciary duty) work in concert.

About what I expected. Good arguments, but I am probably biased. This is a good move.

http://gselinks.com/Court_Filings/Perry/14-5243-1593998.pdf Balls. I will not be in town that day for the oral arguments. :(

A lot of parties have lawyers who have access to the protected documents. The clients are still unable to access those documents. Big difference.

I think the reason you haven't seen GDP growth due to lower commodity prices has to do with issues in the housing market. Issues that I believe are beginning to resolve themselves over the next year or two.

Unless the multiplier on high commodity prices is lower than the multiplier on low commodity prices...

Can you explain this a bit further? The government is arguing that while there was no requirement, per se, to issue a 100-0 preferential stock (in relation to commons), there was indeed specific authority to, granted by HERA. Consummating this authorized action necessarily overrides 151c, therefore it is not possible to comply with both federal and state law in this instance. I would read Florida Lime. https://supreme.justia.com/cases/federal/us/373/132/case.html

In Lamberth's view, whether the transfer was arbitrary necessarily requires a why as opposed to what analysis, and hence is barred from judicial inquiry by HERA's anti-injunction provision. A what analysis involves an examination of the existence of conservator power, and is not barred by the anti-injunction provision. The government is arguing that the 100-0 usurpation fits "squarely" within the powers granted to FHFA as conservator under HERA's transfer clause, and this makes it a why not what analysis, barring it from judicial review. It also seems to me this could be construed as constituting a conflict with 151c, and hence preempts it? That is, HERA grants as conservator power an action that 151c prohibits, effectively overriding it. Bah, I shouldn't have used the word arbitrary given that it has connotations with the "arbitrary and capricious" standard under the APA. Imagine that I removed the part containing arbitrary and inserted "has the power to do whatever it wants." Proceed along what you call the what analysis. The question is, squarely, "does HERA allow the FHFA to rewrite/override the DGCL"? And that is a preemption issue. And you are absolutely correct that there is, in fact, a conflict with the DGCL -- but that's not the end of the legal analysis. If it were, then preemption case law would literally be an algorithm of: The entire case law of preemption would then be superfluous.

Chris should give his thoughts on this one, but I think this is about as close to a "slam dunk" as you can get when it comes to the law. So the issue is whether the transfer is (A) completely able to be arbitrary, i.e. the conservator could have just signed all the assets over to me for nothing or (B) whether it has to follow certain rules/law. I strongly suspect that the answer is (B) and not (A). Then the question is what laws it has to follow, which is your preemption issue. Now, preemption is a very specific legal term of art. (https://en.wikipedia.org/wiki/Federal_preemption#Evidence_of_Congressional_intent_to_preempt) So basically, you have three questions: (1) Was there express preemption? Well, no, because HERA doesn't explicitly state preemption. (2) Was there conflict preemption? Is it possible to comply with both federal and state laws in this instance? Sure. There was no requirement that the conservator act in this manner. So there seems to be no conflict preemption. Is it discernible at the time that Congress passed HERA that Congress implicitly wanted to overwrite the DGCL for these purposes? Well, it doesn't seem like it. So there also seems to be no obstacle preemption. (Note, this is separate from merely whether the state law is an obstacle in the colloquial sense, because if that was the test, then this would literally just collapse into a test of whether state law is different than federal law.) (3) Was there field preemption? Again, probably not because no part of HERA actually dealt with changing the rules on preferred stock and/or common stock.

Roughly flat to down a percent or two.

Chanos' class on the history of financial fraud.

http://www.mrmoneymustache.com/2012/03/19/top-10-cars-for-smart-people/