Author Topic: FNMA and FMCC preferreds. In search of the elusive 10 bagger.  (Read 2591605 times)

Eye4Valu

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9540 on: March 13, 2018, 11:06:55 AM »
My bet would be on Mnuchin driving the train. Kudlow seems more concerned with private capital entering the secondary market than on whether you purchased common or preferred shares pre or post sweep. I think 9 out of 10 posters/observers of this thread would hazard that any purchase of common or preferred shares is speculative in nature. Bruce Berkowitz has discussed why he thinks purchasing preferred stock isn't an outright speculation due to its contractual nature. He also emphasized how the contractual rights are assigned to the new holder irrespective of when purchased. All of this got me thinking about the speculation versus investment dichotomy. While that line is never clear, to the extent holders here, including myself, are speculating, Buffettpedia.com offers the following on this link http://buffettpedia.com/2017/08/investment-versus-speculation-2/:

Benjamin Graham, widely known as the  father of value investing, said that “outright speculation  is neither illegal, immoral, nor (for most people) fattening to the pocketbook”. He acknowledged speculation is necessary and unavoidable, saying that in many common-stock situations there are substantial possibilities of both profit and loss, and the risks must be assumed by someone. But there is intelligent speculation as there is intelligent investing. He mentioned three ways in which speculation is unintelligent: (1) speculating when you think you are investing; (2) speculating seriously instead of as a pastime, when you lack proper knowledge and skill for it; and (3) risking more money in speculation than you can afford to lose.



Midas79

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9541 on: March 13, 2018, 11:19:55 AM »
My bet would be on Mnuchin driving the train. Kudlow seems more concerned with private capital entering the secondary market than on whether you purchased common or preferred shares pre or post sweep. I think 9 out of 10 posters/observers of this thread would hazard that any purchase of common or preferred shares is speculative in nature. Bruce Berkowitz has discussed why he thinks purchasing preferred stock isn't an outright speculation due to its contractual nature. He also emphasized how the contractual rights are assigned to the new holder irrespective of when purchased. All of this got me thinking about the speculation versus investment dichotomy. While that line is never clear, to the extent holders here, including myself, are speculating, Buffettpedia.com offers the following on this link http://buffettpedia.com/2017/08/investment-versus-speculation-2/:

Benjamin Graham, widely known as the  father of value investing, said that “outright speculation  is neither illegal, immoral, nor (for most people) fattening to the pocketbook”. He acknowledged speculation is necessary and unavoidable, saying that in many common-stock situations there are substantial possibilities of both profit and loss, and the risks must be assumed by someone. But there is intelligent speculation as there is intelligent investing. He mentioned three ways in which speculation is unintelligent: (1) speculating when you think you are investing; (2) speculating seriously instead of as a pastime, when you lack proper knowledge and skill for it; and (3) risking more money in speculation than you can afford to lose.

My point about "investor" versus "speculator" is a matter of connotation: positive for the former and negative for the latter. Especially when used in the phrase "hedge fund speculators". The FnF saga is at least as much political as economic, just see how often David Stevens has used not letting hedge funds get a "windfall" as a reason not to recap and release the companies.

I only brought the point up to muse about whether Kudlow's proclamations about shareholders getting screwed is necessarily good news for post-NWS buyers in the event Kudlow does end up heading the NEC.

Eye4Valu

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9542 on: March 13, 2018, 04:23:22 PM »
May be irrelevant to the situation, but didn't know this.

https://www.usnews.com/news/business/articles/2018-03-08/what-swamp-lobbyists-get-ethics-waivers-to-work-for-trump:

"Brian Callahan, the top lawyer at Treasury, was granted a waiver concerning issues involving his former position as general counsel at Cooper and Kirk PLLC. The law firm represents Fairholme Funds, which recently filed a lawsuit against the Treasury Department and the Fair Housing Finance Agency.

McGahn's waiver allows Callahan to participate in discussions about policy decisions pertaining to housing finance reform, even though "some of these discussions could at some point touch upon issues that might impact the litigation."

http://www.govexec.com/oversight/2017/06/newly-released-agency-ethics-waivers-leave-much-unanswered/138528/

"Brian Callahan, whom Trump named as deputy general counsel at the Treasury Department, won a letter from Treasury’s designated agency ethics official, Rochelle Granat, saying, “This memorandum documents that I have granted you a limited authorization pursuant to the Standards of Ethical Conduct for Employees of the Executive Branch (Standards) to allow you to participate fully in policy matters related to housing finance reform even if an issue arises that might impact pending litigation in which your former employer, Cooper & Kirk PLLC, represents one of several plaintiffs. Notwithstanding this limited authorization, you have elected to refrain from any participation in the management of the litigation, including any communication with your former employer concerning this matter.”

cherzeca

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9543 on: March 13, 2018, 06:14:19 PM »
May be irrelevant to the situation, but didn't know this.

https://www.usnews.com/news/business/articles/2018-03-08/what-swamp-lobbyists-get-ethics-waivers-to-work-for-trump:

"Brian Callahan, the top lawyer at Treasury, was granted a waiver concerning issues involving his former position as general counsel at Cooper and Kirk PLLC. The law firm represents Fairholme Funds, which recently filed a lawsuit against the Treasury Department and the Fair Housing Finance Agency.

McGahn's waiver allows Callahan to participate in discussions about policy decisions pertaining to housing finance reform, even though "some of these discussions could at some point touch upon issues that might impact the litigation."

http://www.govexec.com/oversight/2017/06/newly-released-agency-ethics-waivers-leave-much-unanswered/138528/

"Brian Callahan, whom Trump named as deputy general counsel at the Treasury Department, won a letter from Treasury’s designated agency ethics official, Rochelle Granat, saying, “This memorandum documents that I have granted you a limited authorization pursuant to the Standards of Ethical Conduct for Employees of the Executive Branch (Standards) to allow you to participate fully in policy matters related to housing finance reform even if an issue arises that might impact pending litigation in which your former employer, Cooper & Kirk PLLC, represents one of several plaintiffs. Notwithstanding this limited authorization, you have elected to refrain from any participation in the management of the litigation, including any communication with your former employer concerning this matter.”

his linkedin resume shows he was at C&K only a few months, but as partner after a stint on senate staff.  former dc circuit clerk and...gibson dunn associate. 

Eye4Valu

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9544 on: March 13, 2018, 09:09:41 PM »
May be irrelevant to the situation, but didn't know this.

https://www.usnews.com/news/business/articles/2018-03-08/what-swamp-lobbyists-get-ethics-waivers-to-work-for-trump:

"Brian Callahan, the top lawyer at Treasury, was granted a waiver concerning issues involving his former position as general counsel at Cooper and Kirk PLLC. The law firm represents Fairholme Funds, which recently filed a lawsuit against the Treasury Department and the Fair Housing Finance Agency.

McGahn's waiver allows Callahan to participate in discussions about policy decisions pertaining to housing finance reform, even though "some of these discussions could at some point touch upon issues that might impact the litigation."

http://www.govexec.com/oversight/2017/06/newly-released-agency-ethics-waivers-leave-much-unanswered/138528/

"Brian Callahan, whom Trump named as deputy general counsel at the Treasury Department, won a letter from Treasury’s designated agency ethics official, Rochelle Granat, saying, “This memorandum documents that I have granted you a limited authorization pursuant to the Standards of Ethical Conduct for Employees of the Executive Branch (Standards) to allow you to participate fully in policy matters related to housing finance reform even if an issue arises that might impact pending litigation in which your former employer, Cooper & Kirk PLLC, represents one of several plaintiffs. Notwithstanding this limited authorization, you have elected to refrain from any participation in the management of the litigation, including any communication with your former employer concerning this matter.”

his linkedin resume shows he was at C&K only a few months, but as partner after a stint on senate staff.  former dc circuit clerk and...gibson dunn associate.

Conflicted and connected.
 

orthopa

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9545 on: March 14, 2018, 06:29:08 AM »
This looks to be relevant

http://www.businessinsider.com/ken-moelis-million-dollar-coin-flip-with-donald-trump-2017-7

Maybe gives a little idea as to why Paulson was in on the Moelis plan and how the name Moelis came out of no where with a grand plan for housing reform.

We can speculate as much as we want but the intertangled web of connections and relationships is starting to become quite obvious. Even more so who is on the outside (AEI, MBA, corker, hensarling) and who is on the inside.

DRValue

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9546 on: March 14, 2018, 06:34:37 AM »
This looks to be relevant

http://www.businessinsider.com/ken-moelis-million-dollar-coin-flip-with-donald-trump-2017-7

Maybe gives a little idea as to why Paulson was in on the Moelis plan and how the name Moelis came out of no where with a grand plan for housing reform.

We can speculate as much as we want but the intertangled web of connections and relationships is starting to become quite obvious. Even more so who is on the outside (AEI, MBA, corker, hensarling) and who is on the inside.

I'd say it's very relevant. This "investment" sometimes feels like the ultimate coin flip.
Not Investment Advice. Do Your Own Research.

cherzeca

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9547 on: March 14, 2018, 09:10:57 AM »
This looks to be relevant

http://www.businessinsider.com/ken-moelis-million-dollar-coin-flip-with-donald-trump-2017-7

Maybe gives a little idea as to why Paulson was in on the Moelis plan and how the name Moelis came out of no where with a grand plan for housing reform.

We can speculate as much as we want but the intertangled web of connections and relationships is starting to become quite obvious. Even more so who is on the outside (AEI, MBA, corker, hensarling) and who is on the inside.

I'd say it's very relevant. This "investment" sometimes feels like the ultimate coin flip.

so far, heads we win, tails you lose.  waiting for a new coin

rros

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9548 on: March 15, 2018, 07:55:15 AM »
Posting comments from article on American Banker on explicit guraantee.

Mine: Even with implicit guarantee, these large banks that MBA represents, took taxpayers to toilet by causing financial crisis, with an explicit guarantee, our country will be begging China to rescue us. No to explicit guarantee.


“Brought to you by the cowards who don't want to have any skin in the game when the "safe" loans they make go bad.”


“My friend David and the MBA have been on so many sides of the GSE issue that my head spins keeping up with them. His feigned crocodile tears over small community banks won't shake the belief that the MBA only cares about their larger commercial bank members. The MBA fear is that Congress--with other priorities--won't have time to work on Fannie/Freddie matters leaving it to a more thoughtful approach through some Treasury or Federal Housing Finance Agency (FHFA) regulatory directive.”


“So Lets get David Stevens/Corker 2.0 bill (not Warner bill because he has not supported it yet) 1. Govt. Provides explicit Guarantee to securties 2. Securities are created by GSE infrastructure called CSS. And who gets to benefit from all this for doing nothing? Ahhh!! the Wells Fargo and other big banks (as the David Stevens bill call for only 4-5 more guarantors)”

“Why Does David Steven not disclose the names of potential 4-5 guarantors that will be created by his bill? Bcoz that will give away his plan and make crystal clear that Gainers will be Wells Fargo and other big banks and losers will be american home buyers.”


“Whats David stevens problem with GSE as a utility model. They will keep there intellectual property (CSS) and they will be a low risk business with regulated return on capital?”

“Another spin by David "spin" Stevens is some how smaller banks and community banks are supposes to be benefited by his proposal that will create large banks as guarantors. Again, So small community banks will have to deal with Large Banks for there securitization needs, and he hopes that these Large TBTF bank will then play fair. and not to mention they compete in the same communities to get lending business.”

https://www.americanbanker.com/opinion/housing-market-needs-an-explicit-government-guarantee
Pressure re implicit/explicit guarantee is a good way to twist MBAs arm in favor of a recap. If anything, I imagine banks will drop their pants as long as they can secure an explicit guarantee. If they can come out of all this with just that it will be a victory for them. Even if they can't get their hands on Fannie and Freddie's business.

rros

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #9549 on: March 15, 2018, 10:36:45 AM »
Any preferred holder with an Ameritrade account?

This was posted yesterday at the ihub preferred board:
Quote
We are writing to inform you of a buy-out that's currently being offered to certain shareholders in a class of stock that you are invested in. Current holders of FNMAS, among other classes of Fannie Mae Preferred Stock, are being sought by a private investor that is seeking to make a large investment in Preferred Stock of Fannie Mae. The current price offered for FNMAS is $12 per share. If you are interested in this offer, please contact your local office to initiate the transfer process and the cash will be deposited into your account.

The highest weekly closing price was at $12.31 on March 2014.
« Last Edit: March 15, 2018, 10:40:12 AM by rros »