Author Topic: FNMA and FMCC preferreds. In search of the elusive 10 bagger.  (Read 2941827 times)

rros

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10620 on: October 15, 2018, 08:56:43 AM »
Video of Phillips: https://twitter.com/MBAMortgage/status/1051860342362390528
Thank you.

-> explicit guarantee fully paid paid for and on budget
- > charters removed (requires Congress)
- > seeks level-playing field through sizing (meaning, imo, shrinking FF).


Luke 5:32

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10621 on: October 15, 2018, 09:30:31 AM »
Where oh where are we going to get the necessary money for infrastructure plans? :-)

https://twitter.com/austinpkilgore/status/1051871781374574592
"We should think of housing as core infrastructure of the country," similar to roads and transportation, says outgoing @FannieMae CEO Tim Mayopolous #MBAAnnual18
« Last Edit: October 15, 2018, 09:34:14 AM by Luke 5:32 »
Invest for retirement?  Sure.  But investing in eternity is infinitely more important.  Don't get it twisted.  "...but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal."  Matthew 6:20

orthopa

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10622 on: October 15, 2018, 11:45:59 AM »
Am I wrong in saying this is the first time Phillips has confirmed or said these things? Again market not buying it or ignoring it. Maybe market thinking time to implementation makes the securities still unattractive at these prices? Not sure what else needs to be said here besides when and how much. Market saying still no more then 25% of par at this point.
« Last Edit: October 15, 2018, 12:24:57 PM by orthopa »

investorG

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10623 on: October 15, 2018, 12:07:16 PM »
Am I wrong in saying this is the first time Phillips has confirmed or said these things? Again market not buying it or ignoring it. Maybe market thinking time to implementation makes the securities still unattractive at these prices? Not sure what else needs to be said here besides when and how much. Market saying still no more then 25% of par at this point.

Phillips' comments seem good.  hopefully they are 'all in' to get this done in 2019 rather than just talking points.  His bullets appear to confirm the Mulvaney OMB plan from a few months ago and don't seem aligned with the House republicans' ginnie mae lovefest.

muted reaction could possibly be a) disappointed people who were still clinging to near term administrative action and b) supply overhang from hedge funds like highfields (gse owner) closing and possibly forced redemptions from owners like fairholme (see their performance).

hopefully they go hard in 2019 on this.  assuming they throw in some affordable housing $, it is not impossible for Congress to get this done next year with base case Pat Toomey and Maxine Waters leading and getting a lot but not all of what they want.

investorG

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10624 on: October 15, 2018, 12:15:46 PM »
We know how important 110 billion is to the admin. Why would 150-200 billion from warrants be not important?


when including dilution and lower earnings from higher competition forward looking, its probably more like 75-100bn value to the govt from warrants.

investorG

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10625 on: October 15, 2018, 12:18:45 PM »
Chairman of MBA this morning...

https://twitter.com/DoddFrankUpdate/status/1051822050451578880
Chris George on #GSE reform: "We have got to get our agencies out of conservatorship." #MBAAnnual18

https://twitter.com/DoddFrankUpdate/status/1051856893189246976
Phillips: administration advocates end of conservatorship and a return of Fannie and Freddie to private ownership. #MBAAnnual18

with private ownership an official goal of OMB + Treasury, they should start the capital build yesterday with the 10pct moment having been hit -->> be bold, do the right thing, and replace the NWS sweep with the capital backstop fee!

Midas79

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10626 on: October 15, 2018, 12:19:25 PM »
Am I wrong in saying this is the first time Phillips has confirmed or said these things? Again market not buying it or ignoring it. Maybe market thinking time to implementation makes the securities still unattractive at these prices? Not sure what else needs to be said here besides when and how much. Market saying still no more then 25% of par at this point.

Phillips' comments seem good.  hopefully they are 'all in' to get this done in 2019 rather than just talking points.  His bullets appear to confirm the Mulvaney OMB plan from a few months ago and don't seem aligned with the House republicans' ginnie mae lovefest.

muted reaction could possibly be a) disappointed people who were still clinging to near term administrative action and b) supply overhang from hedge funds like highfields (gse owner) closing and possibly forced redemptions from owners like fairholme (see their performance).

hopefully they go hard in 2019 on this.  assuming they throw in some affordable housing $, it is not impossible for Congress to get this done next year with base case Pat Toomey and Maxine Waters leading and getting a lot but not all of what they want.

I take it we should be rooting for the Democrats to take the House then.

I just don't see Phillips's comments as being all that special, other than a reiteration and crystallization of Treasury's stance. The charter repeal and explicit guarantee are Congress-only items. It is starting to look like the administration won't act alone after all, except for perhaps a panic move in mid-2020 if they fail to get anything going in Congress up to that point.

What would happen if a shareholder-friendly court decision happens before then? I always thought Treasury had incentive to act on its own and quickly, but unless getting their own FHFA director installed is extremely important for that, they are otherwise just dragging their feet.

Speaking of the new FHFA director, why hasn't Trump nominated anyone yet? He doesn't (and shouldn't) have to wait until January, and given how long the Democrats are dragging confirmations out, Trump should have had his pick in months ago. Does anyone really want another "acting FHFA director" saga?

investorG

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10627 on: October 15, 2018, 12:35:24 PM »
Am I wrong in saying this is the first time Phillips has confirmed or said these things? Again market not buying it or ignoring it. Maybe market thinking time to implementation makes the securities still unattractive at these prices? Not sure what else needs to be said here besides when and how much. Market saying still no more then 25% of par at this point.

Phillips' comments seem good.  hopefully they are 'all in' to get this done in 2019 rather than just talking points.  His bullets appear to confirm the Mulvaney OMB plan from a few months ago and don't seem aligned with the House republicans' ginnie mae lovefest.

muted reaction could possibly be a) disappointed people who were still clinging to near term administrative action and b) supply overhang from hedge funds like highfields (gse owner) closing and possibly forced redemptions from owners like fairholme (see their performance).

hopefully they go hard in 2019 on this.  assuming they throw in some affordable housing $, it is not impossible for Congress to get this done next year with base case Pat Toomey and Maxine Waters leading and getting a lot but not all of what they want.

I take it we should be rooting for the Democrats to take the House then.

I just don't see Phillips's comments as being all that special, other than a reiteration and crystallization of Treasury's stance. The charter repeal and explicit guarantee are Congress-only items. It is starting to look like the administration won't act alone after all, except for perhaps a panic move in mid-2020 if they fail to get anything going in Congress up to that point.

What would happen if a shareholder-friendly court decision happens before then? I always thought Treasury had incentive to act on its own and quickly, but unless getting their own FHFA director installed is extremely important for that, they are otherwise just dragging their feet.

Speaking of the new FHFA director, why hasn't Trump nominated anyone yet? He doesn't (and shouldn't) have to wait until January, and given how long the Democrats are dragging confirmations out, Trump should have had his pick in months ago. Does anyone really want another "acting FHFA director" saga?

it seems big to me, the most specific Tsy (power player) has been about getting these two companies back into private hands.

I believe we're one large buyer (and volume to clean up the overhang) from a material move higher. 

guessing, I'd expect a FHFA announcement soon after the elections. 

cherzeca

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10628 on: October 15, 2018, 03:07:27 PM »
my take on Phillips comments is that the administration is trying to build a consensus starting out, which is smart.  re-privatize GSEs, but introduce concepts also acceptable to the MBA lobby.  but guess what? those accommodating MBA concepts require congressional action (no competing mbs guarantor will be able to compete without a fed catastrophic backstop).  what is the fallback provision if the MBA lobby cant get congress to OK the total package?  GSE re-privatization...and $100B in treasury's trump wish list coffers.

SnarkyPuppy

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #10629 on: October 15, 2018, 04:05:46 PM »
Not sure why anything publicly said so far would be inconsistent with the mutualization model.  Member banks provide capital and returns are regulated.  Banks can appy to join as members under reg approval