That’s in part because the FHA’s accounting method mean its reserves are enough to cover more than 30 years of projected losses, assuming no revenue from new business, he said.

This is just plain pump-monkey nonsense.

FHA currently requires 3.5% down.  Remember that (contrary to the Realtard's assertions) all home purchases are instantly underwater by approximately 8% from their "purchase price" at closing, because typical Realtor commissions are 6% and closing costs, including title transfer, title insurance and doc stamps typically consume about 2% of the deal price.  A home that must be immediately resold thus instantly "consumes" about 8% of the purchase price, and this deficiency persists over time, rising market or not.

As such FHA loans are all immediately in negative equity at closing.  If delinquency is running at 14% (which is 60 day+ only), or 22.9% (if you include 30 day lates) the fact remains that in order for the FHA to be "solvent" those problems must all occur after the loans go into positive equity status.

Now one can argue that with conservative loan-to-value ratios the FHA won't lose its shirt.   But even there the borrowers will unless the debt-to-income numbers are similarly conservative, and they are not, as I have previously documented.  Indeed,

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