Author Topic: FNMA and FMCC preferreds. In search of the elusive 10 bagger.  (Read 3078509 times)

muscleman

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11930 on: March 14, 2019, 02:28:16 PM »
Calabria not on today's closure.  :(
Is there any limitation on how many people can be in a closure? I know there are lots of judges to be confirmed. Can't they put everyone on closure today?
« Last Edit: March 14, 2019, 04:57:40 PM by muscleman »


Ahab

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11931 on: March 14, 2019, 02:31:11 PM »
@cherzeca
These facts certainly color my thinking and I see good reasons for optimism in the administration's approach. Although, in regards to Calabria's confirmation and the start of the recapitalization process, it's not over until the fat lady sings. I think that's why the market refuses to budge too much on the preferred share prices. We as shareholders have been hoping for years to wake up one day to a decisive change (legal or administrative) in the status of these entities. Until that day comes, risk and uncertainty will endure in hearty quantities.

orthopa

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11932 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 #11933 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.

rros

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11934 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 #11935 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 #11936 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.

investorG

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Re: FNMA and FMCC preferreds. In search of the elusive 10 bagger.
« Reply #11937 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 #11938 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 #11939 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.