KeNo's Housing and Economic Portal: Thursday April 16 Housing and Economic stories

TOP STORIES:

Fannie, Freddie Could Need Another Bailout As Risks Rise: Watchdog - (www.ibtimes.com) U.S. housing finance companies Fannie Mae and Freddie Mac could require more bailouts from U.S. taxpayers as risks are rising due to shrinking reserves, an internal watchdog for the firms' regulator said on Wednesday. Washington bailed out the two firms in 2008 at the height of the financial crisis and has since seized all their quarterly profits while demanding the firms reduce their capital buffers. "Future profitability is far from assured," Federal Housing Finance Agency Office of Inspector General said in a report, pointing out that the firms could again chalk up losses on their derivatives portfolios, similar to those they reported in the fourth quarter. "(This) increases the likelihood of additional Treasury investment," the report stated. Fannie Mae's chief executive issued the same warning in February when the firm announced it would make its smallest payment to taxpayers in more than four years.

[Morgenson] Charles Grassley Questions Diversion of Fannie and Freddie Earnings - (www.nytimes.com) For almost two years, shareholders of Fannie Mae and Freddie Mac have been asking the United States government about its 2012 decision to divert all of the mortgage finance giants’ earnings to the Treasury rather than let them repay taxpayers under the original bailout agreement. But the government has declined to disclose documents relating to that decision, contending that some may be subject to presidential privilege. Now, this cloak of secrecy has drawn the scrutiny of Charles E. Grassley, the Iowa Republican who is chairman of the Senate Judiciary Committee. On Tuesday, Mr. Grassley sent letters to the Justice Department and the Treasury asking for details about the decision and why the government has kept such a tight lid on documents relating to it. “The taxpayer has a right to know what has transpired,” Mr. Grassley wrote in letters to both Eric H. Holder Jr., the United States attorney general, and Jacob Lew, the Treasury secretary. “But, instead of transparency, there appears to be an invocation of executive privilege. If true, this is cause for concern.”

Red-light cameras create red hot furor in Chicago – (www.usatoday.com) In the most contentious mayoral race Chicago has seen in decades, there has been plenty of debate about the city's crushing pension debt, declining credit rating and incumbent Mayor Rahm Emanuel's decision to shutter 50 schools with low enrollment. But another issue that is gnawing at Chicagoans keeps popping up: anger over red-light cameras. The angst in the nation's third-largest city, where a red-light camera violation will set you back $100, is hardly an anomaly. From South Florida to Southern California, the use of red-light cameras by law enforcement agencies has emerged as one of the most contentious issues in local and state politics. In Chicago, which has the most expansive use of red-light cameras in the country, the public outrage over red lights has been louder than most.

Fair Game: After the Housing Crisis, a Cash Flood and Silence - (www.nytimes.com) On Aug. 17, 2012, the federal government began expropriating all the earnings of Fannie Mae and Freddie Mac, the mortgage finance giants that succumbed to the 2008 crisis. Now the government is taking extraordinary measures to keep secret the deliberations surrounding that action. What exactly is it trying to hide? That is the question being asked by a Fannie and Freddie shareholder who has sued the government over the 2012 profit grab. The investor contends that the move amounted to an improper taking of its property; the government disagrees. Margaret M. Sweeney, a judge in the Court of Federal Claims, will determine who is right. But in the meantime, consider the remarkable secrecy demands that the government has made in the matter. Previously undisclosed court records show that the Justice Department has asserted presidential privilege to prevent 45 documents from being produced. These materials — emails, draft memos and news releases — were created by officials at the Treasury Department and the Federal Housing Finance Agency, the overseer of Fannie and Freddie since they collapsed in 2008.

Red-light cameras? There's an app for that - (www.usatoday.com) Fed up with red-light cameras? A new mobile application helps you locate cameras in 130 cities, including Rochester, at 900 intersections and roadways nationwide. The initial version of the app, which is available for iOS and free to download, also includes speed cameras elsewhere but contains only static maps. A second version under development should be GPS capable, providing audio alerts when approaching a photo-enforced area. Redflex Traffic Systems created the app, called RedflexLocator, and also installed the cameras. For the company to try to increase driver awareness and, thus, avoidance of its cameras might seem an odd approach — given that Redflex relies on the fines from violations to pay its bills. Redflex insists otherwise. "This is the exact reason why we launched this app," said company spokeswoman Jody Ryan. "We have not done a good job of communicating the reason for the cameras. The reason is safety. This app is one step of our overall communication strategy for letting people know where the cameras are located and how the cameras work."

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