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FFFacts, dead right on both... Guido keeps mentioning no mention of conversion in capital rule -- but it is a rule from the REGULATOR and not from the CONSERVATOR
It can be confusing that FHFA is both, but still...
Getting there. My price target is closer than all the euphoric $3+ ones...
Absent a positive SCOTUS ruling, and hiring FA’s maybe, then a long summer slide sideways and down
Curious whether pref holds up. I have no cash left anyway except in my Roth IRA which I just funded for 2019 & 20
Thanks for checking in
Right, the plan means FnF can get out under a consent decree and then the TBTF lobby loses it political hold on FnF
I don't think future FHFA's directors will increase capital held, I can see pretty good reasons why lobbying would result in lowering capital levels with new FHFA director
The TBTF lobby has a lot of political clout, but all that ceases to be effective when FnF stop being a plaything of congress and administration -- so of course they HATE anything that furthers RnR
The main thing is getting out under a consent decree and then out from the conservatorship
As predicted, going under $2 absent news -- the rip and fade pattern continues
Got sell the initial rip, cos then it always fades on no news
Hope SCOTUS comes through...
I can see commons getting warrants to buy at say $8 or $10.
After all, with $33 Billion of JPS converting to common, and $100 Billion of new common, anything at all to take the sting off that dilution might help... a little
That is a radical surmise...
The Nomura analyst had the words for them -- I agree it is pretty clear...
I just like this new idea of warrants
I like the idea of getting something for so many years, 8?, without interest payments -- so maybe warrants are it
We shall see in November.
Fingers crossed that SCOTUS delivers something, but Roberts is a reliable switcher right now, so I would worry about him delivering a weaselly judgement that precludes blowback to FnF for some squirelly reason
Thanks for the recommendations, I will look those up next time I visit!
We can agree about OTC, it is a sewer and the sooner I get away from it the better... no regulation as far as I can see
So Nomura analyst says $5 common with conversion for pref -- I also like the sound of the 80% par in common PLUS warrants on top... I will take the warrants ty
Funny how all these folks continue to say conversion, conversion, conversion... oh, right, converting adds to CET1 -- of course, kinda obvious?
Yank, I agree that the momo just got zapped and that we sit (or slowly fade) till news -- and a market correction will take the FnF securities along for the ride to some degree
But I don't blame Maloni and Howard. Anyone who can read Calabria's rule sees that we just injected another risk -- that either investors will say "No Bueno" or ask for punitive prices
Hopefully Calabria will be brushed back. I cannot remember whether alterations to the rule require further comments, or can Calabria make alterations and then issue the rule? More time and then we are sitting before Maxine Waters while she peels the flesh off the RnR...
Buy what, common or pref?
Bill, thanks for the response, I realize it is now the time for the other side(s) to lobby for more operationally viable rules... We shall see.
Whitney Tilson? LOL -- he is such a bad stock picker and analyst he had to shut his hedge fund. Half his ideas are just recycled Ackman ideas
Tilson does not seem to have a grip on the political and legal angles at all
No thank you to Tilson advice: Buffett yes, Tilson no...
Thought you meant Elizabeth Warren lol
I am amused at all these people bashing Buffet for not buying right now. Pretty obvious Buffet thinks another, bigger, leg down is coming -- and Berkshire will again be sitting with a pile of cash dealing with desperate blue chip companies. And Uncle Warren will make out like a bandit...
A good reason to be worried about another dip, since Uncle Warren is no one's fool -- made me laugh that Ackman sold Berkshire. Bill thinks he can do better than Warren LOL.
FFF, there is a downside tho. Worst case: Trump loses, Calabria/Mnuchin do not do RnR for some reason, then we get Biden (and possibly Warren) and new FHFA director... and we need to wait on courts for help.. and we go down Dicken's "Dombey and Sons" route...
Basically, I have to stop posting here lol, and focus on other stocks -- I am with you and think I have a pretty good grip on the situation till news.
I also think we could be all set for another big dip in the markets, but right now I am fully invested in the losers from last crash... fingers crossed. Got to decide when or if to sell... better spending time on that than here...
Yeah, the last couple of years were similar for me. At the times I had a big position here it was stressful given the reliance on (and behavior) of characters like Calabria... I have no trust in him, hence I can only stomach the pref given the lower risk.. I also won;t ever again have such a large position here, too stressful and risky... but I did great Xmas 2018 in the common...
Bill, one question (maybe a couple...).
Do you think that this kind of capital rule was needed to get the FnF administrative process through the WH? I am not speculating this is Calabria's motivation, but Mnuchin is a wily operator -- do you think he has gone along with this capital rule to undercut opposition to RnR in the administration and/or congressional Republican caucases? Was this the pound of flsh Mnuchin had to give up?
I appreciate your insights on all of this inside the beltway stuff, best, potty
Lumpina, given the patterns we have seen in common that is not a crazy approach imho. That is what I did earlier in the year with the pref and I profited handsomely in other stocks before reinvesting again, in a smaller position, back in pref.
But the markets have run up a lot off the lows, so if you did raise cash I would wait for a market dip to buy in... But cash is king when opportunities arise...
GL whatever you do, best, potty
Hmmm, well last week people were asked for the predictions of close. Most said FnF going to break higher, I said $2.13. I was right about that.
Of course I am not your financial adviser, nor is anything I say here offered as financial advice or a recommendation.
This is just discussion on a discussion board -- and my PREDICTION is FNF common drift lower over the summer with no news...
Sorry and I feel your pain etc. etc.
ACG analytics gave a window for a ruling of June 15 to July 15, so any time after June 15 tho we know that means it could be Fall, lol
FFF, those are the events I see too.
Seilia is obviously a huge wild card, but I am not hopeful. I think Federal judges keep their eye on billion dollar implications of their rulings. So I expect some weaselly way to rule that does not entail big import for FnF. But we shall see the nature of these conservative justices, is it relly all about principle or not?
As to the interlocutary appeal, and then Judge Atlas actions on Collins, I would not bet on anything before 2021 -- these Federal judges move at snail's pace. Quite incredible, really.
I would be happy if we have positive surprises, I am invested here in pref, but I think it all comes down to what happens after the election.
Interested to see what polling in August and September does to SP -- Trump polling badly probably helps the SP, cos then they need to get it done. Trump polling even or better, that seems to hurt the SP cos then they can fritter away another 2 years...
Just my 2 cents...
Yup, fading with no substantive news,...
Over the summer, I would not be surprised to see this slip under $2, absent news, since that has always been the pattern
But we shall see.
Are you implying Bruce Berkowitz down there in Florid?
More plausibly, Bradford has sources who use the SeekingAlpha articles to get their info out...
Yank, you are right to focus on the politics that the capital rule speaks to. The capital rule silences all the Republican critics saying FnF were unsafe and those include critics in the WH. We do not know what battles Mnuchin and Calabria had to fight to move RnR forward, but my guess is that the high capital was part of their strategy to win and move forward.
So, I agree, people need to calm down. That RnR is moving forward is a HUGE win and a HUGE change for all shareholders. Get FnF released under a binding set of contracts, including a settlement and consent decree, and we will be in another world...
It is getting a bit "Dombey and Sons", so I am not sure about the courts saving anything
Maybe a SCOTUS hail mary, but I am afraid we are all going to eat it with regard to whatever Mnuchin and Calabria want to feed us
That is why I am with the pref, not sure I want to have to eat that kind of sandwhich...
I love the gif of the little guy on the horsey...
Look what Ackman did to JCP (I think he was chairman?) and now HHC (where I know he is chairman).
In both cases Ackman hired really poorly -- hired the clown from Apple at JCP who cost boatloads and lost marketshare. Then at HHC hired a CEO who massively increased costs and turned the NYC Seaport project into a vanity project that is now a millstone, rather than the positive it should be.
People don't often remark on how well Buffett operates his companies and that he can pick good management -- he usually buys proven management and leaves them in place. Ackman has failed both times he has tried his hand at operating a business and hired badly...
I say NO to Ackman as chairman of their boards.
Calabria said "shareholders will be heavily diluted" in the offering -- so Calabria does not just say there won;t be a windfall, he also explicitly says shareholders will be heavily diluted...
As people rightly emphasize here -- facts matter. It is a fact Calabria said shareholders will be heavily diluted... FACT
Thanks for noting that -- it comes right at the end of the interview and could not be clearer
I live in the Mid-west, so I try to be extra polite -- you were a good midwestern boy but you seem to have been corrupted by Florida. Are you turning into a Florida man?
For the aggregated news links, discussion, and insight...
And good luck to you too, we can all profit, I hope...
THAT adminstrative action is happening after election is now more probable, imho, but what the common SP will be is not something we have had any new information about imho
Please correct me if I am wrong?
Lots of people are speculating here on where common SP ends up -- from offering Rainbow and Crock of Gold scenarios (Yanksghost) or pointing out Grim Reaper Dilution possibilities (Joseph). Both are still possible, and everything in between, but I have no idea have to assign them probabilities.
Another set of options is that administrative action does not happen at all (Pence becomes President and replaces Mnuchin or says NO, or who knows)..
So I stick to the prefs with their face value and contract.
I have my FNMA prefs now, I won't be moving (all things being equal) till after the election and the curtain is finally pulled back to reveal administrative action... or not.
I may add to my pref holdings, since I have Roth IRA's to fund for 2019 and 2020 - these would be good options for those... but depends if the price runs away or not.
Like the capital rule moved you over $2.50? Notice a pattern? Until there is news that share count is favorable to common SP at $3, $4, $5, whatever, then there will be trouble moving over those thresholds...
I don't it works that way... and I am not buying back into the common until after the offering (if at all)
Heard June 15 STARTS potential for an opinion - but no fixed date cos as we now know Federal judges don’t work to deadlines...
End of day fade into my 2.13 target?
What would I get (aside from the abuse)?
Thank you for your insight, being told to "shut up" by bullies has always had the opposite effect on me - good job.
Alt, I agree about the positive signs on adminstrative action. But two points color what I think comes next over summer for SP.
First, I look back to the history of this stock. It rips on news, then decays on no news. Maybe we run up this week, then I think we come down until more news.
Second, large preferred holders can short the common in expectation of a conversion and this helps supress the common price which helps the conversion ration. On its own, a long pref, short common strategy may have appeal. That will potentially put pressure on common right up to the point of the Big Bang.
But the Animal Spirits are strong right now in the market, I expect a big green week so maybe FnF common rides too, what do I know lol