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You need to understand what has changed.
Prior to conservatorship... the GSEs were eating up the mortgage market's business for breakfast. All the opposition didn't like that.
Their solution was to take FnF out of the game... aka conservatorship.
The status quo has worked well for the industry for a while but things have changed.
At the moment... The GSEs in conservatorship being forced to do all of these affordable housing initiatives is becoming detrimental to the opposition's businesses bottom line.
Now the situation is such that keeping FnF in conservatorship is MORE harmful to them than having them privatized. It is THIS reason that David Stevens has changed his tune.
You know what this is going to evolve into right?
- It's not about FnF being in conservatorship...
- It's not about shareholders' justice...
FnF is going to become a proxy war among the Dems/Repubs/Mortgage industry on what housing should be.
Sandra is going to be forced to move forward. From what has happened in the past month... clearly she caves into pressure.
Mortgage industry was hounding her about the DTI.
Result: DTI got pushed out to summer but now has been cancelled.
Then they've been pounding her with the LLPAs...
Result: RFI for how to approach ERCF.
Now people are saying FnF should exit conservatorship.
What do you think Sandra will do?
Step it up, I'm doing $50k par value per month right now.
The rights travel with the shares. You gave it up.
You should know that Buffet will take the lion's share if he moves. That means he's going to dilute the legacy commons to oblivion.
Dream again... Warren is too smart to buy commons. Based on his past actions, he always worked out a private preferred shares model that gave him the ability to convert to commons.
https://markets.businessinsider.com/news/stocks/warren-buffett-invested-5-billion-bank-of-america-made-fortune-2020-10-1029690339#:~:text=Buffett%20and%20Moynihan%20agreed%20that,paid%20a%205%25%20annual%20dividend.
We all know that he regretted not having bought FnF in the past. When the opportunity arises for him to screw over legacy commons so that he can keep the lion's share. He will do it.
He is not your friend. Mark my words.
No. The new FHFA announcement has nothing to do with what Senator Scott is talking about.
These are two completely different issues.
The DTI elimination has more to do with what Dave Stevens was talking about in his housingwire interview. The MBA pushed hard to have FHFA postpone the DTI fee to the summer time but it looks like FHFA has caved into pressure and eliminated it completely now. The coalition at the time let the LLPA grid pricing move forward because they wanted to focus on the DTI instead.
Stevens was also pounding the table during the interview about how leaving the GSE in conservatorship and letting them whiplash between administrations is NOT good in the long run. Missing the forest for the trees.
To add on to what I was saying...
Previously, it was safer to the MBA to keep FnF in conservatorship.
However, it is now becoming dangerous for the MBA's book of business to keep FnF in conservatorship. The interests between the MBA and FHFA/Admin are beginning to DIVERGE.
Going to have to agree with Bradford on this one.
It's too late for them to continue manipulating if the next R admin takes over. If the Ds want to do it, they need to lock it in stone now.
The ebbs and flows have changed recently.
Dave Stevens on housingwire:
I've resumed JPS buying, aiming for 1k every 2 weeks.
Last time I made a move on my portfolio was in Feb of 2022...
The tune has changed and none of these clowns even know it.
Although the question on my mind still hasn't changed, who will the new capital be? Remember, those who put in enough money will have a seat at the table and have a say in what happens in the housing market going forward.
Will the MBA install their own puppet?
Does anyone know or have data on who were the largest shareholders of FnF pre-2007?
It is of MY opinion that the recap and release is not a simple game of raising money.
What is more important is who will be the ones that get a seat at the board to dictate the future of FnF going forward. The money is secondary to the acquired power.
If Stevens and the MBA want a say, they'd install a board member.
And if you thought that was a mistake...
The dude is 20 years old...
Entire FNMA investment thesis based on 20 year olds...
The sayer dude is in college too...
IMO that wasn't the highlight of TH's response, this was:
"So I think the significance of Dave’s epiphany is that he does realize, and now is willing to say, that what the big banks have been able to get Treasury and FHFA to do with Fannie and Freddie since the financial crisis IS beginning to have negative repercussions on primary market lenders (here, via the LLPA issue), and he doesn’t like it."
That's a catalyst for Recap & Release.
The conversation needs to shift from whether or not they should be released to...
Who will be the new owners of FnF.
Hint: It won't be legacy commons.
Thanks for the reference to support my claim.
But like I said... the capital plans will NOT foreshadow conservatorship exit.
After exit has been announced, the plans will be updated on the next submission to reflect what will be done with the capital.
For those who are hoping the capital plans will be like the next iphone technical specs LEAK.
It will not be.
Hopefully y'all sold at .49 and locked in your 8 cent gains cuz its coming back down to .39 real soon.
You a lawyer?
Great, this board is now taking advice from a college student.
Even a blind man wouldn't pay $10 for commons when they're going for 40 cents right now on the open market...
Bro. Your plane ticket says economy and you can't sit in first class. That's the fine print.
But, what is stopping the airline from upgrading you to first class?
You can't do it but they can.
Initially, I was taken aback by the SVB debacle because it seems like a distraction to FnF recapitalization.
But then I realized that once it does get contained, FnF recap and release is a big possibility.
What the SVB failure proves is that even CASH DEPOSITS are not safe... people are moving their cash around to different banks in hopes for "safety"....
You know where there would be a HUGE appetite to park some money?
FNF
Capital plans won't reveal exit out of conservatorship.
What it will say is: We maintain course of accumulating capital to reach our capital requirements.
AFTER the conservatorship exits gets implemented, THEN the capital plans will reflect what they will do.
Wait for a nickel.
Office and commercial mbs are on their way out.
Blackstone defaults on 531million of CMBS
https://www.bloomberg.com/news/articles/2023-03-02/blackstone-defaults-on-531-million-nordic-property-backed-cmbs
Columbia property trust defaults on 1.7B
https://therealdeal.com/national/2023/02/22/pimcos-columbia-property-trust-defaults-on-1-7b-of-office-loans/
They're insolvent... assets worth less than liabilities.
Where is this excess profit coming from?
SVB is in receivership. All common shareholders wiped out.
You're of the same day amazon shipping mindset...
In FnF's case, it'll work more like a trust after you're dead. May be too late for you but the trust will do what you willed it to do.