An interesting article in the Wall Street Journal today highlights why the Treasury Department’s Christmas Eve gift of more liquidity for Fannie Mae and Freddie Mac eases the financial pressure on the two mortgage enterprises.

What the article neglects to mention is that Fannie Mae’s mortgage portfolio has flattened out in recent months. In data released Monday, Fannie disclosed that liquidations in its mortgage portfolio climbed to $9.17 billion in November, nearly 1% more than in October, although on a year-over-year basis liquidations are 39% higher. Suffice it to say, Fannie’s liquidations bumped around the low $9 billions through the fall compared to the $10 billion-to-$12.5 billion range from February to August.

There’s no pride in $9.17 billion of liquidations in a month, but at least the overall credit-performance trend is slightly better at Fannie. Now, the article today implies that the freer reign from Treasury will allow Fannie to write off more loans, and even buy more non-performing loans, so all these numbers come with those caveats. I guess I tend to focus on the positive.

See Fannie’s November numbers here.