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5800%+ expected gain and its a "HOLD" and not a buy?
Time to sell those GSE puppies and buy some common shares if that is the case.
Unfortunately it has nothing to do with "maximizing the value of commons" because how much the govt's stake is worth have nothing to do with the price of common shares.
The percentage of ownership is what determines how much the govt's stake is worth. Ultimately the enterprise value is the starting point and that is unaffected by how many shares are outstanding.
You can forward split, reverse split the common shares as much as you want but it does not intrinsically affect how much your position is worth.
What are you common holders doing?! You need to buy more to keep the price up. It's going in the wrong direction.
How many shares of FnF does Alec Mazo have?
Decent common volume but seems to be heading in the wrong direction. Driving in reverse?
Commons or Preferreds?
Hey Rodney, you don't have to look very far because its literally right on FHFA's website.
https://www.fhfa.gov/Conservatorship/Pages/Senior-Preferred-Stock-Purchase-Agreements.aspx
There's been a SLEW of housingwire articles related to GSEs recently.
The rumor mill is definitely churning, over in DC.
That article is spot on... Mortgage industry wants fannie and freddie out, not because they care but because keeping them in conservatorship is finally hurting their bottomline.
To the moon it goes today.
That basically states that Lamberth damages are NOT capital distribution.
It is referring to legal payment of a purchase or sale of an equity security of an enterprise OR for damages arising from the purchase, sale or retention of such a security.
Please. Read. Carefully.
(3) Any payment of any claim, whether or not reduced to judgment, liquidated or unliquidated, fixed, contingent, matured or unmatured, disputed or undisputed, legal, equitable, secured or unsecured, arising from rescission of a purchase or sale of an equity security of an Enterprise or for damages arising from the purchase, sale, or retention of such a security.
Link: https://www.law.cornell.edu/cfr/text/12/1229.13
Put another way:
- (3) Any payment of any claim
- (whether or not reduced to judgment, liquidated or unliquidated, fixed, contingent, matured or unmatured, disputed or undisputed, legal, equitable, secured or unsecured)
- arising from rescission of a purchase or sale of an equity security of an Enterprise or for damages arising from the purchase, sale, or retention of such a security.
None of Sandra's weekly parking tickets that have been paid by FnF have been considered "capital distributions."
And you don't think Trump will screw shareholders since his MO is to book "yuge profits"?
Bro, capital distribution is distribution of profits which comes in the form of dividends and share buybacks. It ends on a positive note.
It's not profit distribution from Lamberth's court, it is a fine/damages/penalty. It is an ordinary expense. It ends on a negative note.
For the last time, there is NO DELAY in Lamberth's court. It is on schedule and right on time according to his order. If a deadline was missed then you can say it is a delay.
I'm still waiting for your profound wisdom... yet to be seen.
1/11/24 - Biden Admin Could Lean on GSEs in Election Year
https://www.insidemortgagefinance.com/articles/229893-might-biden-weaponize-the-gses-by-nov-5?v=preview
1/12/24 - James Lockhart Says It’s Time to End the Conservatorship
https://www.insidemortgagefinance.com/articles/229912-james-lockhart-says-its-time-to-end-the-conservatorship?v=preview#:~:text=And%20when%20it%20comes%20to,do%20much%20to%20control%20supply.
1/16/24 - Lockhart Suggests GSEs Make Their Case to End Conservatorship
https://www.insidemortgagefinance.com/articles/229930-lockhart-suggests-gses-make-their-case-to-end-conservatorship?v=preview
When are you going to learn to stop using bold and italics for everything? You do know that those are meant for emphasis on certain words right?
Wow, commons above a buck. Must be due to Trump's Iowa Win.
Barron, the Lamberth damages is not distribution of capital. It's your typical run of the mill expense, no different from paying the salaries of FHFA.
I'm not sure why there is this idea that there is a delay in Lamberth's ruling.
There is no delay because it is moving on schedule.
Literally in the proposed order, he states
- Final decision requires an allocation plan
- Plaintiffs need to submit it.
- Defendants need to agree/appeal
I don't care about who did the deed, Rs or Ds. Crying over spilt milk only provides entertainment for those laughing at you over the spilt milk.
Super Tuesday is in less than 2 months.
Biden is out of shots... no more bullets left. At least anything that he can get done reasonably quickly and make a difference.
Fortunately for him, there is one last trigger to pull that can make a difference. Free FnF and single handedly drop the 30 yr mortgage rate by 1-1.25%
Imagine those headlines going into the election.
That NYT article was fabulous reporting albeit with 2-3 factual errors... but great background info nonetheless.
During early years of conservatorship period, the motive was to eliminate FnF so that the big banks can absorb their business.
However, since the Feds started jacking up the interest rates and the mortgage rate spreads started widening, the conservatorship is now negatively affecting the big banks business.
It has become more beneficial to release the GSE than to keep them in conservatorship. Forgot who said it but GSE release and resumption of buying MBS can drop the mortgage rates by about 1-1.25%.
Commons quiet today.
JPS market manipulation?
- FNMAT had 4.5M shares traded with average volume of 60k...
- FNMAS set 52 week high @ 3.50 in the last half hour of trading.
Take out more loans? 😅
I thought everyone on this board bought at the lowest of lows at 1 cent per share 🙄
For $5million par value, taxed as ordinary income short term gains will land you with roughly 51% tax rate in NYC. You are liable for about 2.5M in taxes. The 10x gains has now become 5x overnight.
If you're able to hold on until long term gains, it drops down to 33.53% which is close to a 17% difference which equates to a saving of 850k in taxes. You are liable for 1.676M in taxes.
Now if you don't sell it all at once and piecemeal it ~500k per year, the tax rate drops down to ~25%.
Blindly selling will give back most of your gains.
Well it appears that Bradford is clueless when it comes to taxes. I would not take any advice from in him regards to that.
@Kthomp19 Would you happen to know what the Lamberth payments would be classified as tax-wise? Is it simply ordinary income? Long term capital gains?
What's up with the cliff dive below a buck?
Bradford, that is true if you only have a single share but it becomes quite substantial in the 100s of thousands.
Au contraire, 25% tax rate vs 45% tax rate can make a pretty big dent if you don't tax plan well...
Ok. Then... payout may occur within the next 6 months probably?
Do you know if the money would be classified as long term capital gains or is it just ordinary income?
Regardless of the end result of all of this, hopefully everyone on this board knows not to get into bed with the govt ever again.
You don't think they would try to appeal to 3x their earnings for another year of work? How many investment opportunities have that type of potential return?
Personally, I would prefer that they didn't do it because I just want my payout... but the incentives are hard for people to ignore.
Plaintiff side will definitely appeal.
- More billable lawyer hours.
- Larger payout = bigger lawyer pay.
Incentives are to appeal... unfortunately we'll be waiting at least another 12-18 months.
Rodney quotes Barron.
Barron quotes Rodney.
What is going on?
Yes, NWS is set to resume once FnF reaches full retained capital.
However during capital retention, LP goes up dollar by dollar.
Once NWS resumes, LP will stop rising.
In other words, seniors need to be dealt with. Munckin set it up this way so that treasury/president/fhfa still holds all of the cards in their hand in case there is something that they want to do...
NWS was determined to be legal and may continue as is.
Damages are only based on the one day drop in share price from enactment of NWS. No further penalties or damages are to be further awarded.
You can go ahead and file another law suit seeking damages for a one day drop in share price from 1/9/24 to 1/10/24.
Good luck.
Because it's the fourth time it got amended. Knucklehead.
https://www.fhfa.gov/Conservatorship/Documents/Senior-Preferred-Stock-Agree/FNM/SPSPA-amends/FNM-Fourth-Amended-Restated-Certificate-04-13-21.pdf
Do you even know what the current situation is?
NWS is set to resume once FnF reach required capital as per 4th amendment.
"Number 4: Mandatory Pay Down of Liquidation Preference Upon Issuance of Capital Stock"
- Mandatory paydown of liquidation preference
- Upon issuance of capital stock
What that is in reference to is the rule of absolute priority which is who gets paid first during restructuring. In other words, the capital stack.
Before FnF can disburse a single $1 of capital to stakeholders, the liquidation preference needs to be paid/settled first.
This means:
- Stock buybacks
- Dividends
- New JPS issuance
- IPO new shares
What it also implies is no exit from conservatorship until LP is settled.