Fannie Mae-No Politics (FNMA)

[contrarian bull]

The warrants were collateral in case the bailout money wasn't returned.

They are more than that. The assumption is that at the time of a bailout the company is worth virtually nothing. If the gov't bails them out - guides them along - is a wise and honorable conservator - they deserve to see some gain from all their efforts when the stock goes back up. So the warrants mean they enter into a "profit sharing" plan with the stock holders where they get 80% of the profits.

The warrants are as much to reward and motivate them to be a wise and honorable conservator as they are collateral.

At the time of the bailout the gov't assumed they might never get paid back and thus why they charged 10% interest... kind of a "hard money" loan. The warrants would be worthless if the company never recovered enough to pay back the "loan".

2 separate things.

Of course in the case of F&F... many of the assumptions above were false... but that is a different story playing out in the courts.

[navycmdr]

more like a Rover or Audi Q7 from the profits

[Patswil]

$11Bill Earnings/1.16 bill shares X 17 P/E= $161.00 +16=$176.00

$44/share….perhaps after a 4/1 forward split–warrants are invalid= the biggest variable is what the P/E should be

So treble damages—-=$528/pps…that’s with P/E of 17===could be higher–A LOT===think like TRUMP—not only do we have TBTF
screwing us–now it’s confirmed that accounting Fraud screwed us too–Un-F*****ng believable–Deloite will probably go the way of Price Waterhouse–IMPLOSION

How long have I been saying this? We should this level of PPS upon Release--with full restore and recap

getting closer by the day

[contrarian bull]

Gov_has warrants_yes_but if_they excersize them_there will_be_major problems.

You got that right!!!! If they release then exercise the warrants congress will have an extra $150 billion dollars to spend on who knows what???!!! The more money they have the bigger the problems we all have.

[stockprofitter]

Hoping both C and P do equally well

[skeptic7]

I don't understand the second part of your message. Capisce?

[navycmdr]

IMFnews ... Thursday, Oct 5, 2017




Purchase-Mortgage Boom Pumps Up Fannie/Freddie MBS Volume in 3Q17

By John Bancroft [e-mail]

The conventional secondary market caught up with the seasonal surge in home-buying activity during the third quarter, leading to a hefty 17.9 percent jump in the production of Fannie Mae and Freddie Mac mortgage-backed securities.

The two government-sponsored enterprises issued $223.61 billion of single-family MBS during the recently completed third quarter, a new Inside Mortgage Finance analysis reveals.

Although that was the strongest three-month period of 2017, the market was significantly busier in the second half of last year, and total issuance through the end of September came up 6.4 percent short of the total for the same period in 2016.

Still, 3Q17 was substantially better than the April-June cycle. Purchase-mortgage activity in the GSE market surged 21.5 percent higher in the third quarter – and Fannie recorded a whopping 35.9 percent jump in such business. And the refi market showed some life as well, with securitization volume rising 4.4 percent from the second quarter. For the full story and exclusive tables on the top loan sellers to the GSEs,

[stockprofitter]

Agree

[contrarian bull]

what value do you place on F and F

This has been gone over many times with some variation... but to summarize my opinion:

Value of fnma after release:

$20 if warrants are exercised and full payment is made to buy back senior preferred with no credit for sweep payments already made.

$100 if warrants are not exercised, full payment made, no credit for sweep payments.

$250 if warrants are not exercised, full payment made, full credit for sweep payments.

$400 if warrants not exercised, senior preferred are forgiven, sweep payments are refunded.

If you take into account odds of each scenario above happening and the time before that happens - current value of F&F is about $25.

As a contrast - the value of junior preferred in all 4 cases is $25 (or $50 for some) Maybe twice that in the extremely unlikely event F&F are required by courts to pay dividends they suspended back in 2008 or so.

[Rk3]

--------------------
"Gretchen as Moderator

Thank you for pointing that out

It might help explain how she knows so much

She carries weight

Would be super great if she does another Sunday Times piece - maybe on capital shortage ?"
-----------------------

Her articles are well written and investigated, something the rest of MSM could take a cue from, Bigly.

[navycmdr]

lol ... sold Shares I bought @ $1.53 up to $2.40 @ $3.15

only straits are What to kind of car to spend the Wad of cash on

[JosephS]

I think frogger said 1000.

Why not 10,000?

Maybe a 1:1 conversion w/ brk-a?

Not a recco

[stockprofitter]

Therefore the warrants are dead.

[Donotunderstand]

answer

exercising the warrants does NOT help Fannie

extinguishing the warrants - having them buried - helps us avoid 4:1 dilution

warrants have huge value to GOV

some here expect GOV to both want full return on SR PAPER and the GOV to dilute us ---- double hit

I do not see both ...

but we agree F and F (equity-us) lose if the warrants are exercised --- the TREASURY wins as they will sell the stock they get in the open market for 80-150B

[stockprofitter]

The warrants were collateral in case the bailout money wasn't returned.

[stockprofitter]

Mnuchin has confirmed stolen $$'s from FNF went to Obama, Obamacare and other places.
When a crime is discovered of the money I see not returned to it's owner that is a whole new problem.

Capish?

[Donotunderstand]

yes

the only winner is the GOV -- as they will sell the shares they get for .001$ for 10 or 20 or 30 dollars a share

[Donotunderstand]

yes

the only winner is the GOV -- as they will sell the shares they get for .001$ for 10 or 20 or 30 dollars a share

[stockprofitter]

Correct. The warrants are issued to the government.

The proceeds of the warrants - do the math 4b x $.0001

My question now to you is ~ How does exercising the warrants help Fannie Mae?

[RCChristian]

My Prediction!

End of Quarter will be a crises. Hurricanes will force a draw, trump will initiate an executive order for Treasury to fix FnF. Mel Watts will be fired.

Do you guys see it too? How can we avoid a draw?

[skeptic7]

Correct. However, DJT allowing the Net Sweep to continue despite Mnuchin saying publicly that profits were used illegally to subsidize ObamaCare makes him complicit.

He could keep his campaign promise of instituting the Rule of Law, at the same time expose the "scandal free" Barack Obama publicly, and MOST important get a leg up on repeal and replace ObamaCare. Do you think a different tune might be sung by those GOP'ers who undermined the vote if they knew that O'Care was subsidized by ill gotten gains? I do.

[Donotunderstand]

I agree

see contrarian etc.

exercising the warrants hurts us - equity

it makes the GOV which owns them and exercised them rich and us poorer (less rich) by dilution of shares

[955]

Nice move converting to cash. You done good. THAT is the type of discipline it takes to WIN in today's hostile trading environment.

the moment I heard from Mel Watt what I expected him to Say

i.e. passing "his" RESPONSIBILITY to Congress I SOLD ...

absolutely NOTHING is gonna happen until NEXT YEAR

or END of this QTR WHEN THEY HAVE TO TAKE ACTION at the EARLIEST ...

unless we get a COURT RULING in SHAREHOLDERS FAVOR ...

HOPE is NOT a VALID TRADING STRATEGY .... I LISTENED to WHAT HE SAID

and I TRADED ACCORDINGLY ... GOOD TRADING ALL

[stockprofitter]

Excersizing the warrants does not help Fannie recapitialze as no investor would want any part of a company with 9 billion shares outstanding.

[Donotunderstand]

if you believe that

what value do you place on F and F

[stockprofitter]

Gov has warrants yes but if they excersize them there will be major problems.

Btw those warrants are not Berkowitz's and he just can't have the cake and eat it too.

[Donotunderstand]

F and F do not own the warrants

F and F can not exercise what they do not own

the fear is the GOV which owns the warrants WILL pay the .001 per share or whatever and get 4 B shares of common

(that is why some for years argued own the preferred stock)

[stockprofitter]

Watt is swamp who was an Obama appointee, left his $4m salary yr job to earn 600k at FHFA but more importantly to help his friend. Smells good doesn't it.

[Donotunderstand]

yes

the GOV has the right to buy 79.9% of F and F for pennies and get the shares ........... the GOV then sells those 4B+ shares of stock they bought for pennies for 80-150B

[Donotunderstand]

yes

right now I am mostly frustrated at the dumping on WATT by so many posters - all to avoid aiming at the POTUS who last I looked is in charge of the Executive branch to include Treasury and DOJ

[stockprofitter]

Get over it. EXcersizing the warrants DOES NOT HELP in providing capital to Fannie Mae.

[contrarian bull]

can affordto "buy_back" one but not both

That is my hope

GOV exercises the warrants and takes in a ton of money and calls it square

Or F and F use the assets to cover the SR PAPER - GOV gets a bunch of cash and drops the warrants

My fear is the GOV decides to get rich on BOTH

We can afford to "buy back" one but not both

Who is the "we" buying back? F&F have to pay for the senior preferred shares, and the "cost" (dilution) for the warrants will be on the backs of the common shareholders.

Of course the gov't will collect on both. I mean - if DT just walks away from $200B in warrants then he SHOULD be impeached for dereliction of duty.

[bcde]

"the difference is that now the GSE's have been reformed from the inside. setting the stage for recap and release but of course you have no knowledge of this or any desire to research it. yet you keep saying they haven't done anything positive...... "

vanderol,

If you have done the research and know it, then present the facts.

I keep on asking for the same thing. What has been done to benefit FnF and FnF shareholders?

In the last 9 years, FnF have been bankrupted and FnF shareholders have received 00000000000000000000 returns.

[Donotunderstand]

1. There is no interest on senior preferred paper

2. I understand that the GOV says to this day that all cash from F and F to Treasury is dividends and the SR PAPER is 100% alive - all of it

I suggest that in a deal - an agreement to move forward with a viable F and F

That in that future deal one view the GOV has entering the negotiation with two birds in two hands

They own the warrants and can dilute us 4 to 1 or so

They own the SR PAPER

If the GOV is interested in seeing F and F alive and well (if) then the GOV could call the senior paper "gone"

That gives F and F tons of capital right there (as the zero capital position is with an obligation to pay 185 B or so)

The GOV then says - ok you are free and have that capital cushion but we the GOV will dilute the equity holders with the warrants

That would not be bad as we would own 20% of a fully capitalized F and F

[stockprofitter]

Excersizing the warrants gives Fannie and Freddie what about 100k in capital LOL

A far cry

[stockprofitter]

Common share price at $330 without excersizing warrants is cleaner and further beneficial to all parties, including pension funds, veterans, healthcare and most importantly to the government bottom line.

[stockprofitter]

I didn't say I was suing them

[stockprofitter]

Warrants to purchase at .0001

I'm not wrong

[Donotunderstand]

That is my hope

GOV exercises the warrants and takes in a ton of money and calls it square

Or F and F use the assets to cover the SR PAPER - GOV gets a bunch of cash and drops the warrants

My fear is the GOV decides to get rich on BOTH

We can afford to "buy back" one but not both

?

[955]

As long as we have a CORRUPT Gov whose unstated objective is to lie, steal and cheat the American public, corporate America and the Wall Street jungle will just continue to follow suit. Investigation? Ha! Try filing a complaint with the SEC and see what it gets you. DRAIN THE SWAMP ALREADY!

Can anyone shed light to the eps variations from 212 to 309 on various websites. Just seems like brokers put whatever numbers up they want. I sold a penny stock the other day also and it showed up on the investorhub as a 225000 share buy. I just geel like this kind of manipulation needs to be investigated

[stockprofitter]

Patience, I feel your frustration.

[lumpina]

That's a certain possibility of course - I know lawyers :)

But in this case, I'll stick with my hypothesis.

[Donotunderstand]

profitter

yes - the warrants have near zero value to F and F

but they have an 80-150 Billion dollar value to GOV

that is the issue contrarian was pointing out

he was asking why do you care about the value of the warrants to F and F --- of course that is zero --- but F and F do not hold the warrants - the FEDERAL GOV does

[contrarian bull]

If there's nothing to hide, then why hide it?

It could all be a distraction to buy time. Make them think there is something hidden you do not want to be seen. They file suit after suit to see those documents instead of suing for damages. Time is money.

[Donotunderstand]

You are kidding right ?

You do understand the suits are against the GOV - regardless of who is President

what r u talking about ??

BO was POTUS not the owner of the US --- now DJT is POTUS

I think you have this and warrants value backwards

warrants are worth a ton to GOV who holds them - not to F and F

suits are not against one President but against the Federal GOV

If it is easier to understand - think of the suits as all being refiled on Jan 21 and from there DJT has fought them

[vanderol]

the difference is that now the GSE's have been reformed from the inside. setting the stage for recap and release but of course you have no knowledge of this or any desire to research it. yet you keep saying they haven't done anything positive......

[TFWG]

The Obama administration is long gone. Yet the NWS remains and the NEW ADMINISTRATION continues to fight full disclosure. Sure, it was Bam's Treasury who implemented the NWS and the crazy over-reach of exec. privilage, but it is Mr. Trump's admin who keeps both alive.

In early 2017, a Federal Circuit Court turned down the government’s attempt to end the discovery process altogether but allowed that documents could be made available to plaintiff attorneys on a case-by-case basis.

IMO, The wrath of this board should NOT BE pointed at Watt, ALL FIRE SHOULD BE DIRECTED AT Sec. Steve Mnuchin. Just like his predecessor, our glorified Sec. of the Treasury is calling the shots.

[streamer04]

good luck with your lawsuits against the Bush admin, the obammy admin and the Trump admin.

[Donotunderstand]

yes
and I blamed BO for the last 12 - 18 months of his term for not then seeing that such action was wrong

now that it clearly is visibly wrong - and BO is not POTUS (i.e. we do not have a POTUS who would have to say I was wrong to move in the right direction) ---- why does not the new POTUS who could blame EVERYTHING on BO and BUSH --- not come to our aid

Yes BO started it --- but DJT who can clean the slate and dump on BO at same time (his favorite pas time) HAS NOT DONE SO !!!!

[stockprofitter]

As long as the warrants are not involved there will be no problems.