Is the White House stepping into the FannieGate brouhaha to push a negotiated settlement in the multitude of GSE lawsuits brought by investors who got hit by the Third Amendment Sweep?
Richard Bove, equity research analyst at Rafferty Capital Markets, thinks so.
The fact that three White House counsels now want to take a look at these documents suggests that the White House was probably not aware of what the Treasury and FHFA were doing in the name of executive privilege and without the White House ever seeing the documents in question.
In my view there are two other reasons why the White House now wants to see the documents that were claimed to be privileged:
1) The recent stock-market plunge stems, in part, from fears that the global economy may be weaker than thought. Some definitive action needs to be taken in this country to assure investors that this supposed weakening is not happening here.
2) Several civil-rights organizations, including the NAACP, according to my sources, have approached the White House requesting some help for low-income households that have been shut out of the housing market by the administration's directives for tighter lending standards.
Stated simply: The White House needs Fannie and Freddie to go back to work to do what they were meant to do in the first place – i.e., assist the nation's housing markets to stimulate economic growth. Settling these cases would accomplish just that.
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