Fannie Mae-No Politics (FNMA)

[RickNagra]

Great video. A must watch.

[Guido2]

@SenAlexPadilla & @JudiciaryDems haven't once objected to @FHFA 's $301 billion swindle of @FannieMae & @FreddieMac equity while it keeps them in a fraudulent "temporary" conservatorship for over 16 years.

If USA isn't a🍌REPUBLIC...

END THE SWINDLE!
FREE FANNIE!
FREE FREDDIE!

— Guido da Costa Pereira (@GuidoPerei) September 22, 2024

[RickNagra]

As of the latest information available, BlackRock holds a substantial number of shares in both $FNMA Fannie Mae and FMCC , although exact figures fluctuate based on portfolio adjustments. In earlier filings, BlackRock reported millions of common shares in both entities

— Grail (@SmartMoney777) September 22, 2024

[RickNagra]

How Fannie Mae Could Multiply by 50x? -- $FNMA https://t.co/98aTLwqOgB via @YouTube

— Cmdr Ron Luhmann (@usnavycmdr) September 22, 2024

[EternalPatience]

Proof for the latter?

I

[stockprofitter]

Kamala Harris is owned by BlackRock

BlackRock recently bought 21 million shares Fannie / Freddie common

End of message

[The Man With No Name]

8% max only if the JPS didn't exist. But they do.....so more likely 0.8% than 8%.

[kthomp19]

At last, some reasonable numbers for what it would take for the market to clear. Kudos for avoiding the rampant wishful thinking.

[kthomp19]

My overarching thesis has changed and now assumes that release is coming and common shares at WORST lose 4/5ths ownership value with exercise of warrants (which is a stupid premise to begin with as they were only intended to be a backstop preventing losses and the duration on them was BS to boot).

This is the weak link in your investment thesis.

Treasury had (senior) preferred shares in AIG and converted them to enough commons to dilute the legacy common down to 8% ownership. Importantly, the only reason Treasury didn't dilute them further was that Treasury didn't want the process to be bogged down by shareholders suing AIG's board of directors.

That isn't a concern with FnF because, as the 10-Q and 10-K reports state, FnF's boards of directors owe no fiduciary duties to shareholders during conservatorship. The purpose of converting the seniors into commons would be to remove the huge regulatory capital hole that they represent, so the conversion would have to happen before exit from conservatorship.

Instead of assuming that FnF's legacy common shareholders will get at least 20% of the post-release equity, you should be assuming 8% at the most. That alone cuts any share price estimates you make by around 2/3, if not more.

If you're getting $100+ per share with the warrants not being exercised and the seniors written off, it would be $20 with the warrants exercised and $8 at most with the seniors converted, and that's only if Treasury chooses to treat FnF common shareholders as well as they did with AIG (which strains credulity to the extreme given how Treasury has treated FnF shareholders so far).

[kthomp19]

Barron, file your lawsuit already.

Otherwise don't expect others to believe in something that you don't even believe in.

You already know this is never going to happen. He said so himself.

If I had a nickel for every time a FnF shareholder threatened a lawsuit that they had no intention of filing themselves, I could recap FnF myself.

[kthomp19]

By that reasoning, both JPS and Common should be literally at zero right now.

Both the juniors and commons have zero economic rights at the moment. No dividend rights and no liquidation preference, and no voting rights for the common.

They trade above zero in the market due to the possibility that they could regain some economic rights in the future. They trade like options with no set expiration date.

Shares in bankrupt companies continue to trade after bankruptcy is declared, even when it's clear that those shares are deeply underwater with very little prospect of recovery. Surely you have seen charts of series like SHLDQ, LEHNQ, JCPQ, etc.

In fact, the tickers FNMA and FMCC are highly misleading; they should respectively be called FNMQ and FREQ to accurately reflect their status.

And the GSEs would no longer be a shareholder owned company.

The shares still exist, which allows the government to maintain the convenient fact (though it is a sham) that FnF are shareholder-"owned" companies.

[kthomp19]

You clearly don't understand that investor expectations are not written in the contract and do not take into account every minutia of what changes over time.

Lamberth disagrees. His quote on page 19 of his ruling on the main motion to dismiss:

For an investor contract, the time of contracting for the purposes of the implied covenant
inquiry must be the time of the most recent change in contract—whether by amendment or change
in law. This must be the case because otherwise, conduct consistent with an amendment to a
shareholder's contract or consistent with background corporate law could violate the reasonable
expectations at the time of the issuance, supporting an implied covenant claim. Such would
frustrate the corporate form's flexibility by making amendments practically impossible and
changes to background law of no effect.

When it comes to the implied covenant, reasonable investor expectations DO "take into account every minutia of what changes over time", as you put it.

Yes, and even with those expectations, the NWS was a BREACH of the shareholder agreement.

This is correct. The NWS breached the implied covenant in August 2012 because it violated reasonable shareholder expectations given what the shareholders expected at the time, which includes all amendments and changes in law up to that point.

Reasonable shareholder expectations for any implied covenant claim over an action after the NWS has to take into account that the NWS itself was in place.

Now that it is established that it was a breach, we don't suddenly expect more breaches to be "ok" since there was one in the past.

The LP ratchet isn't a breach because it didn't violate reasonable expectations relative to what was already in place at the time, which was the cash NWS.

SMH. This isn't complicated.

That's true, but it is you who fails to understand. You really need to read and understand Section B ("Plaintiffs State a Claim for Breach of the Implied Covenant of Good Faith and Fair Dealing") from Lamberth's ruling before going any further on this topic.

[kthomp19]

Wait... So if Treasury is already making or has made a "boatload" of cash, they won't seek more cash just because they can?

Under the NWS it didn't matter if the commitment fee was zero and the NWS dividend was all of FnF's net worth, or if the commitment fee was X and the NWS dividend was FnF's net worth minus X. It's the same amount of money either way.

As to why the commitment fee wasn't charged between the start of conservatorship and the NWS, I don't know. FnF had zero or negative net worth in that period, which means they couldn't afford the fee anyway. I have seen a couple of calculations in the past saying that the commitment fee would be somewhere around 50 bps of the funding commitment, which would be at most about $2B per year (on a $400B funding commitment). Treasury was getting an order of magnitude more than that cash via the 10% dividends.

I think this is counter to every other argument you've made.

Not really. The difference between charging a relatively small commitment fee from 2008 to 2012 and not charging it was at most $2B per year, while the difference between writing down and converting the SPS is around 20% of the total value of FnF's post-exit common equity, which could easily exceed $40B.

[kthomp19]

No. I'm arguing that you are a hypocrite for saying because Calabria memorialized that someone from Treasury Thinks™ the writedown would be illegal that is somehow evidence that it is illegal. It's clearly not.

Then you have misunderstood my point. Calabria's words are not evidence that a SPS writedown is illegal. They are evidence that at the time Treasury thought that it would be illegal.

A very important part of a EV calculation of the future common share price is estimating the probability that Treasury writes down the SPS. The only evidence we have is that Treasury thinks it is illegal. Why would you expect Treasury to do something they think is illegal?

Could they change their mind? Sure. But you have to put a number on that probability, not just say it's a possibility. Lists of possibilities without attached probabilities are useless in a EV calculation. If you have some method other than EV of calculating the common share price I would love to see it.

This is a non-sequitur, a False Attribution, and an Argument from Authority.

1) It was not a non sequitur. My quote ("Your unwillingness to take Treasury's words at face value doesn't extend to him.") was completely relevant to my argument (that there is far more reason to believe Calabria accurately reported what Treasury told him than not).
2) It was not a false attribution, unless you have evidence that Calabria was in fact lying about what Treasury told him.
3) It was not an argument from authority. My assigning credibility to Calabria's reporting has nothing to do with his (then) position of authority, but instead him being a party to the negotiations and having no reason to lie.

Three strikes and you're out. Clearly giving you the list of logical fallacies wasn't enough because you don't seem to understand what any of them actually mean.

[kthomp19]

The context of that quote was:

The absurdity of the NWS (cash or LP) must be lost on you. At what point does the government get to take every profit dollar from a company or citizen, and add it to their books as an accounting entry?

Trust us - we're from the Government... We'll let you keep a dollar if you owe us a dollar in the future.

Brilliant! Let's just do that with every American company and watch our National Debt melt away like magic!

You are quoting just the sarcastic part of your quote and acting as if my response only applied to that part. You're better than that.

The question in your quote reads like it's serious, and it can't happen because the law that allowed the NWS (the GSE Act amended by HERA) is unique to FnF.

[TightCoil]

No, somethin; better - so keep your eyes peeled for breaking new tomorrow night, Sunday

[jcromeenes]

I hope they don't assign it to Sweeney or Lamberth! lol.

[jcromeenes]

Are you smoking the devil's lettuce again? lol

[amelia43]

You drank some kool-aid?

[naveedkhan]

But u will not be holding me tight.

[MRJ25]

Come Monday, it will be all right.

[juicyjuice10002]

Is that because of Judgement? thanks.

[TightCoil]

FNMA/FMCC
Monday should be jaw-droppin' Huge - hope you're loaded up
You might call it THE BIG ONE - well, at least A Big One
I might be the only person on the board here that knows why

[blownaccount9]

LOL. Posting here daily unaware that lawsuit has been ongoing over a decade. Clueless.

[nagoya1]

I was eagerly looking to get to the end of this 45 page gse lawsuit to end up with a frown on my face. There’s nothing recent- the oldest date is 2013…
Reading thru it felt like working at judge lamebrain’s pace….
Fnma

[Ispro]

Filed 2013

[RickNagra]

@Bloomberg piece comparing EU & UK vs. US bailouts from financial crisis. US did well, EU & UK did not (underwater in many cases). Interesting mention of Fannie Mae $FNMA and Freddie Mac $FMCC https://t.co/Gt7UCP2pqg via @opinion pic.twitter.com/Wsu8Jv1SO8

— Real Unintelligence (@real_human101) September 20, 2024

[RickNagra]

New lawsuit all 45 pages on X formerly Twitter.

https://t.co/FmbhyJctfs$FNMA $FMCC

— José E Burgos Lugo, PA (@TheBurgosGrp) September 21, 2024

[Guido2]

Thanks FOFreddie.

[Golfbum22]

Please give more information

Anyone

What new lawsuit?


Tia

[stockprofitter]

Have you seen the NEW LAWSUIT filed? It crushes anything I have ever seen in the past besides the class action.

They NAILED THIS ONE.

Kudos to Cooper Kirk and team.

[FOFreddie]

Here is the filing. Just seems like a party has asked for a transcript of a Hearing:

TRANSCRIPT OF PROCEEDINGS before Judge Royce C. Lamberth held on 11/4/22 CORRECTED TRANSCRIPT; Page Numbers: 2859-2872. Court Reporter/Transcriber Tammy Nestor, [e-mail], Transcripts may be ordered by submitting the Transcript Order Form
For the first 90 days after this filing date, the transcript may be viewed at the courthouse at a public terminal or purchased from the court reporter referenced above. After 90 days, the transcript may be accessed via PACER. Other transcript formats, (multi-page, condensed, CD or ASCII) may be purchased from the court reporter.
NOTICE RE REDACTION OF TRANSCRIPTS: The parties have twenty-one days to file with the court and the court reporter any request to redact personal identifiers from this transcript. If no such requests are filed, the transcript will be made available to the public via PACER without redaction after 90 days. The policy, which includes the five personal identifiers specifically covered, is located on our website at www.dcd.uscourts.gov.

Redaction Request due 10/11/2024. Redacted Transcript Deadline set for 10/21/2024. Release of Transcript Res triction set for 12/19/2024.(Nestor, Tammy)

[Golfbum22]

Hopefully next year it happens or plan for it to happen

Something has to happen by 2028 with warrants

Hope you get to see your rewards for this investment

[Patswil]

How about Navy?

[Guido2]

We generally get it from Imbellish. I hope he's still on this board.

[Rodney5]

You mean Seeking Garbage. ?? ha
who in their right mind would pay to read it?

[nagoya1]

PACER account holder needed. Judge Lame's opinion is on PACER....
FNMA

[nagoya1]

PACER account holder needed. Judge Lame's opinion is on PACER....
FNMA

[nagoya1]

PACER account holder needed. Judge Lame's opinion is on PACER....
FNMA

[nagoya1]

I hope that half wit did his job.
FNMA

[nagoya1]

Pacer account holder - needed .
Judge lame's opinion is online.....
FNMA

[TightCoil]

what is this case about, please

[jog49]

" But it keeps the blood boiling and I will see it to the end!"

Maybe yes, maybe no.

[germansaer]

https://www.courtlistener.com/docket/4212077/fairholme-funds-inc-v-federal-housing-finance-agency/?order_by=desc

[JOoa0ky]

Next earnings date is ~Nov-ish.
We'll probably go from 139.5B ~> 148B

[RickNagra]

There is a new Seeking Alpha article just released that mentions us. I cannot post the article though but I read it for free using a nifty trick I have.

FMCC: How financial stocks may fare in a ‘game of regulatory seats’ under a Trump White House

[Viking61]

I expect that we will be close to 150 Billion by the end of this quarter. The half point rate drop ought to fire up refinancing from here to the end of the year!!🚀

[RickNagra]

Realistically I would say latter half of 2027. We currently have $140B in the cookie jar. Per the capital rule we need 4.2% of assets or say about $200B. I highly doubt anyone will change the capital rule. We need another $60B. No doubt Guido will disagree with me. Sad sad sad. LOL.

[RickNagra]

In that case eat a thousand next time.

[TightCoil]

Certainly, it will make superior fertilizer and with that fertilizer you can make things grow and grow and grow, so much that your whole world will be so green that Birds of Paradise will take nest