Author Topic: FNMA and FMCC preferreds. In search of the elusive 10 bagger.  (Read 1853753 times)

rros

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8860 on: December 06, 2017, 06:20:00 PM »
Amazing how nothing leaked given what is at stake.


orthopa

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8861 on: December 06, 2017, 07:25:57 PM »
My own biased interpretation of some shareholders is jr preferred and made whole IMO would be par or close to it. Why? Lawsuits go away, Paulson, Berkowitz, Ackman(depending on how much preferred he has now) are happy and you take the combative nature of the outcome away to a large degree. They start praising the bill, Mnuchin adds his two cents and works with legislators as promised and we go on our merry way. Easy to prime the pump is sneak out the politico/bloomberg piece and see how the market/investors respond.

The common has always been a big crap shoot and has had little representation by those who really matter ( see above). At 20% of par before trading tomorrow is 500% upside not enough when compared to the substantial risk common represents? Even more so after reading the bloomberg piece. Hopefully we see the preferred spike tomorrow.

Who speaks out loudly for the common if they get hosed and what leg to stand on do they have if congress drafts legislation that "upholds the contract" as Berkowitz has wanted.

You now have the 2 of the largest previous opponents of shareholders now switching sides with mnuchin etc. Hensarling is toast.

« Last Edit: December 06, 2017, 07:28:42 PM by orthopa »

cherzeca

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8862 on: December 06, 2017, 07:32:21 PM »
My own biased interpretation of some shareholders is jr preferred and made whole IMO would be par or close to it. Why? Lawsuits go away, Paulson, Berkowitz, Ackman(depending on how much preferred he has now) are happy and you take the combative nature of the outcome away to a large degree. They start praising the bill, Mnuchin adds his two cents and works with legislators as promised and we go on our merry way. Easy to prime the pump is sneak out the politico/bloomberg piece and see how the market/investors respond.

The common has always been a big crap shoot and has had little representation by those who really matter ( see above). At 20% of par before trading tomorrow is 500% upside not enough when compared to the substantial risk common represents? Even more so after reading the bloomberg piece. Hopefully we see the preferred spike tomorrow.

Who speaks out loudly for the common if they get hosed and what leg to stand on do they have if congress drafts legislation that "upholds the contract" as Berkowitz has wanted.

You now have the 2 of the largest previous opponents of shareholders now switching sides with mnuchin etc. Hensarling is toast.

as best as i can tell ackman is all common (derivatives). so unless corker pulled a switheroo on ackman, these reporters are underestimating common's return

SnarkyPuppy

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8863 on: December 06, 2017, 07:34:31 PM »
My own biased interpretation of some shareholders is jr preferred and made whole IMO would be par or close to it. Why? Lawsuits go away, Paulson, Berkowitz, Ackman(depending on how much preferred he has now) are happy and you take the combative nature of the outcome away to a large degree. They start praising the bill, Mnuchin adds his two cents and works with legislators as promised and we go on our merry way. Easy to prime the pump is sneak out the politico/bloomberg piece and see how the market/investors respond.

The common has always been a big crap shoot and has had little representation by those who really matter ( see above). At 20% of par before trading tomorrow is 500% upside not enough when compared to the substantial risk common represents? Even more so after reading the bloomberg piece. Hopefully we see the preferred spike tomorrow.

Who speaks out loudly for the common if they get hosed and what leg to stand on do they have if congress drafts legislation that "upholds the contract" as Berkowitz has wanted.

You now have the 2 of the largest previous opponents of shareholders now switching sides with mnuchin etc. Hensarling is toast.

Largely agree but having trouble reconciling Ackman's recent comments (praising corker/warner and related legislation) and his position being primarily common stock.   Unless he has subsequently substantially swapped his stake- which I don't think is very likely and could be easily interpreted as trading on material non public information

no_free_lunch

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8864 on: December 06, 2017, 07:35:01 PM »
This seems big to me.   Not a done deal but a step in the right direction and welcome change after failing litigation. The preferreds willl have to move up tomorrow or I am doubling down.

Found this as well, sorry if it has been reposted.  This thread has blown up a bit.

Quote
Hensarling said it is politically inevitable that any reform package will include a government guarantee of mortgage bonds like those issued by Fannie Mae and Freddie Mac, the government-backed enterprises that were bailed out after the housing collapse. The companies are currently wards of the state, devoid of capital and reliant on a $258 billion taxpayer lifeline they might need to tap as early as next year.

"I donít want a government guarantee, I donít think we need a government affordable housing program but in surveying the political landscape I know they will exist in any bipartisan effort," Hensarling told POLITICO. "At the end of the day I'm here to make progress."

Speaking at a conference sponsored by the National Association of Realtors and S&P Global, Hensarling endorsed a plan from the Milken Institute authored by Edward DeMarco and Michael Bright. DeMarco, former acting director of the Federal Housing Finance Agency, now leads the Housing Policy Council at the Financial Services Roundtable. Bright is executive vice president at Ginnie Mae, the government corporation that stands behind mortgages backed by the Federal Housing Administration, Department of Veterans Affairs and Department of Agriculture.

https://www.politico.com/story/2017/12/06/hensarling-signals-breakthrough-in-mortgage-reform-208774

merkhet

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8865 on: December 06, 2017, 07:48:00 PM »
I'm surprised at the comments about the commons considering Ackman's recent kind words for Corker/Warner. I would note though that one possible interpretation is that common won't be "made whole" to their pre-conservatorship levels (i.e. $75 per share) so they "may not fare as well."

SnarkyPuppy

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8866 on: December 06, 2017, 07:49:15 PM »
I'm surprised at the comments about the commons considering Ackman's recent kind words for Corker/Warner. I would note though that one possible interpretation is that common won't be "made whole" to their pre-conservatorship levels (i.e. $75 per share) so they "may not fare as well."

+1

Luke 5:32

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8867 on: December 07, 2017, 06:12:30 AM »
Looks like screenshots from a bill (pulled from Twitter so can't verify it). See attached...
« Last Edit: December 07, 2017, 06:32:23 AM by Luke 5:32 »
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rros

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8868 on: December 07, 2017, 06:22:08 AM »
Maybe I am interpreting this wrong but this bill is only about stopping all FF's outflows of money. It says, while not paying dividends do not pay contributions to the housing funds. In other words, keep all the money with the companies. So the bill has been written assuming dividends will also stop. Is this correct?

orthopa

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #8869 on: December 07, 2017, 06:30:47 AM »
I'm surprised at the comments about the commons considering Ackman's recent kind words for Corker/Warner. I would note though that one possible interpretation is that common won't be "made whole" to their pre-conservatorship levels (i.e. $75 per share) so they "may not fare as well."

I can see made whole as in a target ie par. What is the made whole target for common? Can be any number I guess. Secondly there was some talk in the thread about the huge volume spikes in the preferred FNMAS  and FNMAH in october. Very well could have been Ackman et al. Some here thought it her was it was berkos clients liquidating. A