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Glenn says TINA was his thesis - but there was an alternative to private GSE’s and we are in it. Stasis...
Like I said it was not doable politically - got big bank lobby, MBA and free marketeers against it on one side, and “no gifts to hedge funds” on other side
So, SCOTUS has to unlock the door in a couple a clear way, but will it do that? Gambling on federal judges is not for the faint of heart so the sell off will continue...
It was actually a video asking his shareholders not to lynch him lol
Hmm, thanks for posting this. Pagliara clearly does not present for a living, bit repetitive and disorganized
But there were some interesting nuggets in the presentation -- notably that in Lamberth's court Treasury had dumped docs in discovery without objection. That would be a ticking timebomb till Plaintiffs find some juicy stuff -- though there is a vast amount of docs to trawl through
Pagliara's main points are (a) no one could ever survive politically by acknowledging the legal error of NWS and need to repay but (b) SCOTUS will rule NWS is illegal, the need to repay... hence facilitating way forward
A lot hinges on the assumption of (b) and that SCOTUS will rule that way - PLUS a lot hinges on Biden administration not being able, and willing, to weasel out of any such ruling...
Market is repricing the risks here, it is saying they are considerably more than Mr Pagliara assumes apparently
Sorry to hear you are hurting, I think it goes lower through the dark months cos the anti-GSE machine will crank up its hit peices to pressure price as they lobby Biden adminstration...
Lol, why would they know? SCOTUS source, I doubt it...
Howard credited Kao for creativity but basically implied it would not fly politically - but then that is close to saying NOTHING will fly... so endless stasis
Not encouraging at all
Yeah, I also agree about danger of remand back to lower court, but 10 months is optimistic -- 1-2 years would be more in like with previous speed of these federal courts
All the time with the negative PR about dangers of Biden moves...
I think we go down in the dark winter months
yeah, that is my thought. Aided by Bloomberg et al running hit peices and scare-mongering articles...
Michael Kao's take:
Re: Fannie/Freddie-The Path Is Actually Clearer NOW. On its face, this claim may sound ludicrous off the back of a precipitous drop in valuations due to what some interpret as SM losing his nerve and punting to a hostile Admin. In this thread, I posit the exact opposite.
— Michael Kao (@UrbanKaoboy) January 18, 2021
If you don't understand that you should not be invested in any GSE security lol
But, then again, right now no one should be invested in GSE securities... the elevator is going DOWN...
Another sell-off Tuesday and the JPS are beggining to get interesting, finally
I just cannot get past how long this could go on the downside, could just be deep freeze for shareholders while money pays for affordable housing -- new FHFA director and Treasury could do all kinds of stuff... or nothing at all
Calabria can then join Ed DeMarco and Mel Watt in the club of ex-Directors -- truly an august group of human beings
Sweeney was replaced as the judge, so no her responsibility any more btw
yeah, I noted this. It seems as if they are setting-up FMCC for release first...
BUT that was Mnuchin and Calabria, and they are now old news... Mnuchin is gone, Calabria no longer has a partner at Treasury and will be canned forthwith after SCOTUS rules he is fireable at will of the President
So it is a reset once again with new administration, and new set of characters, with more pressing issues (as always)
Let us just hope that Gary Hindes still has Biden's phone number -- or at least Ron Klain's. And, unlike Trump, the Biden team likely will attend to past friends...
I really do not know what to make of the guy. I think he was overmatched by the job both politically, he just could not mount a fight in the administration, and intellectually, since what he proposed as a capital rule is so utterly bizarre
The latter is why I think he is an ideologue -- the capital rule makes no internal sense, it only makes sense if you are some "free-marketeer" (as if the banks operate freely lol) trying to kill the GSE's off...
I would like to see the guy gone, he is clearly part of the problem now and not any part of a solution -- Wachter endorsing the utility model is far more practicable though it will take the Biden administration a year to work out what it wants to do.
Thinking things through, FIRST, the time frame for a JPS investment to pay off for me is June at the earliest, SECOND, there is a real risk SCOTUS does not come through with a remedy that is share-holder friendly OR remands back to a lower court pushing things out 1-2 years again. Unless we get below this 20% par level, I just do not think it is worth the risks/time given where else I can invest -- a SPAC like PSTH has done 50% with more to come
What are your thoughts on the investment here?
SCOTUS will not be taking this recent amendment into consideration in their ruling, I believe.
You can look at what Mnuchin and Calabria did in two ways -- they are forcing a resolution by pressuring plaintiffs to settle or SCOTUS to act. Or you can see it as Mnuchin betting SCOTUS will not touch past amendment, that Treasury will be set to maximize its Senior prefs and warrants after SCOTUS and that this amendment is designed to block any liberation of GSE's back as private companies that Republicans have always hated
I tend to the half full view. And I just cannot justify tying up capital till June when (i) the risk-reward looks bad; (ii) there are so many other things to invest in right now and (iii) I could just keep cash, wait for a crash and buy proper companies on the cheap with no BS about government/congressional decisions
This really needs to get to 10% par on JPS before (i)-(iii) gets over-ridden for me and I make a speculative investment
Good point
Yeah, Biden will want to keep those enterprises and their income...
If SCOTUS rules Calabria is removeable, then a new FHFA director and Treasury Secretary can do pretty much whatever they want... so these changes are reversible
That may be a good thing, if Biden decides these private companies are a key part of the economy. Or a bad thing, if Biden decides the companies can do their jobs and the government can fund its goals with the income from them
Toss-up on SCOTUS, toss-up on Biden -- though all those Urban Institute folks scare the bejesus out of me
I would not be so sure, I think we see a continued sell-off next week as people compute the implications of what Mnuchin just did...
And you are not naive enough to miss that politics permeates everything...
Calabria pulled off quite the trick, since he has gone through the motions of reform and following HERA. BUT he has done it in a way that dooms the GSE's which cannot be viable as private companies the way he has set things up...
Because Calabria is ideologically opposed to the GSE's existence and would like them to disappear -- and came from jobs funded by anti-GSE groups and will go on to the same kind of job
I assume $1.87 is better still and $1.50 will be orgasmic... once we are closer to $1 than $2 I will think about it for a swing trade
And he put the steel toecaps on specially, just for the day
Yup, apocalypse in progress... Tuesday may be worse
When do Fall SCOTUS rulings come out?
I have blacked-out when SCOTUS delivers judgement for its Fall rulings? That is, can someone remind me when we can expect the Collins ruling from SCOTUS?
But I learned when you told me to buy at $2 last week,...
I am more interested in JPS, the commons fell a long way previously but JPS is the one correcting right now...
Yeah, I am curious to see how long, and how deep, the sell-off goes
Federal judges? You really still trust them?
GL
5, 4, 3, 2, 1, ....BARP!!!
Mnuchin let's one rip?
Wait till tomorrow....
So someone is lowering expectations by leaking to Charlie Grifter... not good, not good at all
Curious to see what, if anything, they actually do
Fig leaf action incoming?
Lol, someone trying to bait Trump into canning Mnuchin -- these people play some really dirty pool
I hope so, I made great money on the common from $1 to $3 a few Xmas's ago...
I think the JPS has a meltdown tomorrow if no substantive SPSA... we shall see
I thought you were my alt account?
Court rulings are coin flips in so many ways
:) no, no JPS here. I have been waiting for *at least* 20% par on JPS, and preferably 10% par, before I start buying
I will raise some cash today selling my GLNG calls, so I will have some cash -- have to see whether JPS gets to the fire-sale prices that would tempt me
Cos this is now a flip of he coin on SCOTUS, then endlessly deferred cases elsewhere...