Author Topic: FNMA and FMCC preferreds. In search of the elusive 10 bagger.  (Read 3237693 times)

orthopa

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11930 on: March 15, 2019, 05:56:17 AM »
If Calabria not voted on in time Otting could always stop the sweep too.


muscleman

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11931 on: March 15, 2019, 08:09:12 AM »
If Calabria not voted on in time Otting could always stop the sweep too.

That's true but I don't expect that to happen.
Technical analysis shows me if we don't get a setup within the next two weeks, then there may not be a setup to buy anytime soon. Right now it looks to be getting ready. That's accidentally inline with the 3/31 deadline. I am flat since 2/26. We'll see what happens.
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rros

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11932 on: March 15, 2019, 05:34:17 PM »
Anybody expects:

1. a ruling between now and 3/31?
2. announcement by Otting/Calabria by 3/31?
3. a curve ball out of congress before 3/31.
4. a coordinated attack by fellow travelers for the next 2 weeks.

Right now, we are about to hit the jackpot quarterly if prices stay here. But history has been of sudden deep reversals. Nerve-wracking spring break. Countdown -T 20160 (minutes).

cherzeca

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11933 on: March 15, 2019, 06:36:48 PM »
Anybody expects:

1. a ruling between now and 3/31?
2. announcement by Otting/Calabria by 3/31?
3. a curve ball out of congress before 3/31.
4. a coordinated attack by fellow travelers for the next 2 weeks.

Right now, we are about to hit the jackpot quarterly if prices stay here. But history has been of sudden deep reversals. Nerve-wracking spring break. Countdown -T 20160 (minutes).

1. no
2. yes
3. no
4. of course, to no avail

muscleman

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11934 on: March 15, 2019, 09:03:47 PM »
Anybody expects:

1. a ruling between now and 3/31?
2. announcement by Otting/Calabria by 3/31?
3. a curve ball out of congress before 3/31.
4. a coordinated attack by fellow travelers for the next 2 weeks.

Right now, we are about to hit the jackpot quarterly if prices stay here. But history has been of sudden deep reversals. Nerve-wracking spring break. Countdown -T 20160 (minutes).

1. no
2. yes
3. no
4. of course, to no avail

I agree with most of your points, except that #2 may not happen if Calabria is not confirmed by 3/31. Otting announcing anything drastic may impact Calabria confirmation voting, and cause additional delays. We only have two Thursdays before 3/31, so I expect the confirmation voting to happen soon.
I am muslceman. I have more muscle than brain!

investorG

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11935 on: March 16, 2019, 03:59:55 AM »
It's unrealistic imo to expect a new director to implement such a large change as stopping the sweep in his first few days on the job.  I think it's Mnuchin - Otting or bust for the next 2 weeks.  Sadly, odds favor the sweep continuing again this month as the path of least resistance.  Punt (again) until the Collins verdict. 

It would be somewhat of a charade to increase the capital buffer and the sr pref by a likewise amount as the latter action is fairly inconsistent with the administration's stated goals of ending conservatorship and having the companies well capitalized.  So we're most likely left with the option of replacing the sweep with a backstop commitment fee - and I've had my hopes dashed too many times on this to get excited for it now.

good luck everyone.

Midas79

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11936 on: March 16, 2019, 09:09:26 AM »
It's unrealistic imo to expect a new director to implement such a large change as stopping the sweep in his first few days on the job.  I think it's Mnuchin - Otting or bust for the next 2 weeks.  Sadly, odds favor the sweep continuing again this month as the path of least resistance.  Punt (again) until the Collins verdict. 

It would be somewhat of a charade to increase the capital buffer and the sr pref by a likewise amount as the latter action is fairly inconsistent with the administration's stated goals of ending conservatorship and having the companies well capitalized.  So we're most likely left with the option of replacing the sweep with a backstop commitment fee - and I've had my hopes dashed too many times on this to get excited for it now.

good luck everyone.

Except that it already happened once in December of 2017.

I don't see anything inconsistent about another similar letter agreement in the next two weeks. All increasing the liquidation preference of the seniors does is stop the $16.1B overpayment, past the 10% moment, from going any higher.

I also don't see why Treasury wouldn't just insist on a huge instant capital raise, to get the companies recapped as fast as possible. Then no government backstop is necessary, beyond a catastrophic one that would only kick in if FnF lose more money than they did in 2008.

investorG

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11937 on: March 16, 2019, 10:18:52 AM »
It's unrealistic imo to expect a new director to implement such a large change as stopping the sweep in his first few days on the job.  I think it's Mnuchin - Otting or bust for the next 2 weeks.  Sadly, odds favor the sweep continuing again this month as the path of least resistance.  Punt (again) until the Collins verdict. 

It would be somewhat of a charade to increase the capital buffer and the sr pref by a likewise amount as the latter action is fairly inconsistent with the administration's stated goals of ending conservatorship and having the companies well capitalized.  So we're most likely left with the option of replacing the sweep with a backstop commitment fee - and I've had my hopes dashed too many times on this to get excited for it now.

good luck everyone.

Except that it already happened once in December of 2017.

I don't see anything inconsistent about another similar letter agreement in the next two weeks. All increasing the liquidation preference of the seniors does is stop the $16.1B overpayment, past the 10% moment, from going any higher.

I also don't see why Treasury wouldn't just insist on a huge instant capital raise, to get the companies recapped as fast as possible. Then no government backstop is necessary, beyond a catastrophic one that would only kick in if FnF lose more money than they did in 2008.

the 2017 agreement if I remember correctly was hastily done to block off a re-jumpstart threat.  the 3bn didn't even ward off the additional draw in early 2018.

mnuchin has to worry about trillions of dollars of global GSE related debt remaining calm - an explicit backstop in some form is nice from his angle.

cherzeca

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11938 on: March 17, 2019, 10:44:35 AM »
It's unrealistic imo to expect a new director to implement such a large change as stopping the sweep in his first few days on the job.  I think it's Mnuchin - Otting or bust for the next 2 weeks.  Sadly, odds favor the sweep continuing again this month as the path of least resistance.  Punt (again) until the Collins verdict. 

It would be somewhat of a charade to increase the capital buffer and the sr pref by a likewise amount as the latter action is fairly inconsistent with the administration's stated goals of ending conservatorship and having the companies well capitalized.  So we're most likely left with the option of replacing the sweep with a backstop commitment fee - and I've had my hopes dashed too many times on this to get excited for it now.

good luck everyone.

Except that it already happened once in December of 2017.

I don't see anything inconsistent about another similar letter agreement in the next two weeks. All increasing the liquidation preference of the seniors does is stop the $16.1B overpayment, past the 10% moment, from going any higher.

I also don't see why Treasury wouldn't just insist on a huge instant capital raise, to get the companies recapped as fast as possible. Then no government backstop is necessary, beyond a catastrophic one that would only kick in if FnF lose more money than they did in 2008.

the 2017 agreement if I remember correctly was hastily done to block off a re-jumpstart threat.  the 3bn didn't even ward off the additional draw in early 2018.

mnuchin has to worry about trillions of dollars of global GSE related debt remaining calm - an explicit backstop in some form is nice from his angle.

if you look at the default rates for the post FC mortgage cohort, it is extremely low.  of course, there haven't been significant financial stress during this time either.  but if FHFA sticks to a watchful regulatory posture and doesn't let GSEs buy crap from banks as per pre-FC, I think you will see the temperature surrounding the creditworthiness of GSE-insured mbs decrease. especially once GSEs are recapped.

muscleman

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11939 on: March 17, 2019, 11:42:03 AM »
Interesting to see this from our cheerleader:
https://twitter.com/DoNotLose/status/1106955813330006017
"Otting 2019 Glen

 
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Following Following @DoNotLose
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Well calabria has not been announced by McConnell yet. I think that makes it unlikely if not impossible that he gets in in time to make changes this month... But anything is possible if anyone cares"

Coincidentally, last night I also had a dream that FNMAS was down 10.4%. I think this is just a general reflection of what people are feeling right now, cast into my own sub concious. I take this as a positive sign that it may build the bottom soon.  :)
« Last Edit: March 17, 2019, 11:47:38 AM by muscleman »
I am muslceman. I have more muscle than brain!