Commentary - 03/23/2008

Who Controls Our Major Mortgage Corporations Now?

Obviously, the large mortgage holders are, and have been, in the news. This update reflects recent news such as this article, describing "Fannie, Freddie Shares Soar After Restraints Loosened" versus previous articles such as article on Bloomberg "Freddie, Fannie Shares Will Continue to Slide, Jim Rogers Says." After reviewing the significant changes in Major Holders, especially with Capital Group loading the boats with Fannie Mae stock, and adding to its holdings of Countrywide and Freddie Mac. At the same time, it looks like Barclays and Associates have been unloading their boats.

The most significant change has been Capital Group's sharp rise in ownership in the last six months, and interesting reductions in Barclays/Associates.

CapitalGroupBarclaysAssociates
Company12/31/0706/30/0712/31/0706/30/07
Countrywide35.61%0.00%24.42%32.90%
Freddie Mac32.00%12.25%14.76%15.10%
Fannie Mae73.14%18.42%10.52%27.89%

Looking deeper, the Major Holders who control those mortgage companies have certainly got their hands full. Countrywide, Freddie Mac and Fannie Mae are the three largest players in the mortgage game and you'll find the TOP 10 holders of each company below. For the sake of many of our country's retiring boomers, I sure hope Capital Group has made the right choices. So far, so good.

There are also two rating agencies that oversee this marketplace, Standard and Poors and Moody's. They were detailed in a previous commentary, CIT/FreddieMac - All In The Family. Perhaps this is why Capital Group didn't load up as much on Freddie Mac.

As mentioned last year here, very little has changed since 1889 when the Great Red Dragon book was published, except that a greater amount of power has been concentrated into fewer hands. With Capital Group controlling over $1.4 TRILLION of investments, and that they've become significant holders in our largest mortgage companies, shouldn't we know more about who's calling the shots? One thing I'd like to know is this: Is Capital Group's high-ranking executive, David C. Barclay, related in any way to Barclays Bank??? Google it yourself. Also google Abner Goldstine. Here's one summary.

One last thing: Did you know about the Federal Home Loan Banks? Perhaps it's just being naive, but it sure reads to me like another version of the Federal Reserve Banks. Simply trying to cover the bases here, as its shares are NOT publicly traded and it is a members-only club.

In my opinion, there's just too much secrecy in both business and government, which makes it very easy for people to lie, steal and murder.
Perhaps that's why: Sometimes The Dragon Wins


Symbol Name Of Corporation
CFC

Major
Holders
Countrywide Financial Corp. (As of 31-Dec-2007) (As of 30-Jun-2007)
Top 10 Institutional HoldersShares2007Value2006
Brandes Investment Partners L.P.55,325,1679.56%$494,606,992-.--%
Legg Mason Capital Management, Inc.54,636,5449.44%$488,450,703-.--%
Capital Research And Management Company47,659,0008.24%$905,997,590-.--%
Capital World Investors31,259,0005.40%$279,455,460-.--%
FMR LLC (Fidelity)30,992,4785.36%$277,072,753-.--%
Goldman Sachs Group Inc28,095,1224.85%$251,170,390-.--%
Capital Research Global Investors25,450,0004.40%$227,523,000-.--%
Wellington Management Company, LLP23,883,1864.13%$213,515,682-.--%
Barclays Global Investors UK Holdings Ltd22,376,8123.87%$200,048,699-.--%
Pzena Investment Management, LLC22,128,4243.82%$197,828,110-.--%
% of Shares Held by All Insider and 5% Owners:6%-.--%
Top 10 [2.6%] of 383 Institutional Holders Control59.07%-.--%
Percentage of Barclays and "Associates" Control18.16%-.--%
NOTE: Capital Group manages three funds that control 7.21%.
Legg-Mason manages a fund that controls 3.53%.
Washington Mutual manages a fund that controls 2.73%.
Fidelity manages a fund that controls 1.38%.
Therefore, the TOP 10 Major Holders control 73.92%, and
Barclays/Associates control 24.42% of Countrywide.
Capital Group now controls 35.61%.

Symbol Name Of Corporation
FRE

Major
Holders
Freddie Mac (As of 31-Dec-2007) (As of 30-Jun-2007)
Top 10 Institutional HoldersShares2007Value2006
Capital Research Global Investors60,678,1008.82%$2,067,302,867-.--%
Capital World Investors42,545,6006.18%$1,449,528,592-.--%
AXA (Paris, France)36,630,0155.32%$1,247,984,611-.--%
Pzena Investment Management, LLC29,661,9624.31%$1,010,583,045-.--%
Barclays Global Investors UK Holdings Ltd27,283,6923.97%$929,555,386-.--%
UBS Global Asset Management (Americas) Inc22,649,7973.29%$771,678,583-.--%
Morgan Stanley21,698,4733.15%$739,266,975-.--%
Hotchkis & Wiley Capital Management, LLC21,245,6503.09%$723,839,295-.--%
State Street Corporation21,042,3093.06%$716,911,467-.--%
Goldman Sachs Group Inc20,192,6962.93%$687,965,152-.--%
% of Shares Held by All Insider and 5% Owners:0%-.--%
Top 10 [2.0%] of 489 Institutional Holders Control44.12%-.--%
Percentage of Barclays and "Associates" Control13.11%-.--%
NOTE: Capital Group manages four funds that control 17.00%.
Washington Mutual manages a fund that controls 1.65%.
Vanguard manages a fund that controls 0.91%.
Therefore, the TOP 10 Major Holders control 63.68%, and
Barclays/Associates control 14.76% of Freddie Mac.
Capital Group now controls 32.00%.

Symbol Name Of Corporation
FNM

Major
Holders
Fannie Mae (As of 31-Dec-2007) (As of 30-Jun-2007)
Top 10 Institutional HoldersShares2007Value2006
Capital Research And Management Company208,804,89621.35%$12,697,425,725-.--%
Capital Research Global Investors115,585,26611.82%$4,621,098,934-.--%
Capital World Investors108,644,20011.11%$4,343,595,116-.--%
AXA (Paris, France)41,085,3244.20%$1,642,591,253-.--%
Barclays Global Investors UK Holdings Ltd38,982,4953.99%$1,558,520,150-.--%
FMR LLC (Fidelity)34,875,4863.57%$1,394,321,930-.--%
State Street Corporation30,604,6043.13%$1,223,572,067-.--%
Vanguard Group, Inc. (The)29,380,8203.00%$1,174,645,183-.--%
Lord Abbett & Co28,150,2472.88%$1,125,446,875-.--%
HSBC Holdings PLC23,281,5752.38%$930,797,368-.--%
% of Shares Held by All Insider and 5% Owners:0%-.--%
Top 10 [1.6%] of 603 Institutional Holders Control67.43%-.--%
Percentage of Barclays and "Associates" Control7.12%-.--%
NOTE: Capital Group manages nine funds that control 28.86%.
Washington Mutual manages a fund that controls 3.40%.
Therefore, the TOP 10 Major Holders control 99.69%, and
Barclays/Associates control 10.52% of Fannie Mae.
Capital Group now controls 73.14%.

2008 by Edward Ulysses Cate

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