$FNMA #FANNIEGATE BRUCE BERKOWITZ

For seven years, Fannie Mae (FNMA) and Freddie Mac (FMCC) (5.3% and 5.2% of the Fund portfolio, respectively) have been held against their will in a perpetual conservatorship that has dramatically exceeded its mandate and, perversely, only serves to harm their safety and soundness. Every three months the proverbial cash register at each of these mortgage insurers is looted by a repeat offender – the United States Treasury – unlawfully claiming entitlement to all of Fannie and Freddie’s pro ts in perpetuity while disclaiming any allegations that it has effected the largest nationalization in American history. One need not be a legal scholar to recognize that this illicit scheme is antithetical to the basic notion of a C-O-N-S-E-R-V-A-T-O-R-S-H-I-P. While the progress that litigants are making before the third branch of government is not being re ected in recent prices of Fannie and Freddie preferred securities, we remain cognizant of Mr. Market’s propensity for sudden mood swings.

http://www.gurufocus.com/news/360218/bruce-berkowitzs-semiannual-shareholder-letter