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$FNMA continues to under-perform the Preferreds. What gives!? Is Cancellation of Commons still on the table?
I'm starting to think Calabria is also a member of the Good Ol' Boys Club and he may go along with Berkowitz's plan of taking over the GSEs and redeeming all of their Common equity at Par ($0.00).
#Yikes!
Agreed, Sell the Pops because $FNMA always drops. Time and time again, we realize $FNMA can't hold its gains yet Jr. Preferreds continue to climb the mountain of doubt.
The Good Ol' Boys Club is going to drop the bomb on the Average Joe's.
#It'sComingAmigos
That just means there's going to be a massive short squeeze in Jr. Preferreds. That's something Commons will never see because there's 100s of millions of shares of dilution incoming for Commons
The BIG investors are all buying Jr. Preferreds. You can't go wrong with Contract Rights
All in good fun, amigo! Receivership still can't be ruled out with certainty, although I don't think it's likely any longer.
But, unfortunately, that doesn't mean Commons have massive upside. $4-7 is the range. It's doubtful Commons see double digits in the next decade
What the $FNMA!? Can't crack $3 even with all this "good news." Very disappointing. Yet some are still suggesting $30, now even $300 is apparently in the cards.
Mnuchin and the Good Ol' Boys Club are going to break a lot of $FNMA hearts.
LMAO
Seems low. Does that include the Treble Damages?
Preferreds making new Highs and completely outperforming Commons. Commons can't even crack $3.
Why? Because everyone knows to Sell the Pops, because $FNMA always drops
Sell the Pops, because $FNMA always drops. I learned my lesson and sold my shares on the pop this morning (higher than where $FNMA closed), so I'm happy.
Look forward to buying again in the $2.50s, maybe lower, once it's clear there's nothing in the near-term pipeline.
+.18. Selling what I bought yesterday here. Go $FNMA!
Why did Ackman recently increase his Preferred allocation? What did Calabria say in 2014 about Receivership?
Things change. Ackman has obviously changed his tune, hence the large acquisition of GSE Preferreds.
Agreed. Way too many folks touting $20+ when it's obvious that just isn't practical for a few decades
The Good Ol' Boys Club is the Rule of Law now, and the GSEs get resolved in whatever way they determine.
Hint: It likely won't benefit Commons to the degree many here are expecting. $4-7 is still my range, but that drops $0.25-0.50 every month that goes by without capital retention.
#TickTock
As the big funds Rotate into Jr. Preferreds, they are also selling Commons. There's likely a big overhang of shares from the Average Joe Funds that have accumulated massive Common positions.
As they sell, they're shorting Commons and buying Preferreds. What a mess!
What if they re-IPO at $50 per share? Doesn't that solve all of the world's problems and make us Average Joes filthy rich?
You greedy Preferreds want your measly ~150% return to Par and also want the GSEs to sell new Commons (diluting all of us). You can't have your cake and eat it too
But who sold it? 500k is no joke, that's over 1 Million Dollars! Is Ackman Rotating further into Preferreds?
Those types of Block Sales don't look good.
This looks like the technical breakdown warned about in my previous post. A test to $2.20 seems highly likely now.
Will that area hold is the question.
Does anyone know why Preferreds keep going up? $FNMAS is on fire. I wonder if it's due to connection with the Good Ol' Boys Club.
#SayNoToAverageJoe
Quite the contrary. Jump-Start prevented the Treasury from relinquishing any of its Sr. Preferred shares.
I agree that R&R is more likely than ever. However, the mechanics behind it are an integral part in valuing Commons future potential.
The longer the Admin waits, the lower the price for the secondary offering.
$FNMA is slipping out of the trading range. A sharp drop is looking very likely.
We can't out a back-test of $1.80 as we enter this period of silence from the Admin
The capital raises should occur at lower prices than where $FNMA is currently trading
It's interesting to see so many Preferred additions in the major funds that hold GSE shares. It obviously doesn't bode well for those 100% allocated to Commons.
They're probably following Ackman in their belief that the Recapitalization of the GSEs may favor Jr. Preferreds over Commons.
It ain't easy being at the bottom of the totem pole after all.
Even if plaintiffs win, Commons won't benefit much from it. It might even be a Sell the News event.
Not to mention, the Gov will most certainly appeal and we will have to fight on in the SCOTUS.
Wow, the Rotation from Commons to Preferreds continues! Even Growth Funds of America has made the Rotation.
Your multi-quoting abilities are tantamount to none. Amazing!
Your clarifications regarding some of the falsehoods regularly spread about the GSEs and even more specifically, the Common shares of said companies - $FNMA
The Warrant money goes to the Treasury Not to the GSEs
See my signature for reference, it's directly from the Treasury's website
#SayNoToAverageJoe
There's speculation that Berkowitz will soon be running things. Possibly a hostile takeover of the GSEs (aka, a Backroom Deal with the Good Ol' Boys Club).
Rumor is Calabria will soon endorse the AJP publically. $FNMA should open at $50 on the NYSE on Monday.
Somewhat agree. It will be a modified Moelis plan that will likely have significantly less future price appreciation for Commons.
The original Moelis Blueprint was almost 2 years ago. The only way to get to those projected numbers was if the GSEs had started raising and retaining capital within their projected time frame. Even the updated Moelis Blueprint is getting long in the tooth now.
My guess is, Commons will have to take a beating in order for the GSEs to raise the necessary capital within the next 12-18 months.
Commons may still see my target range of $5-7, but it's looking less and less likely as time passes. With each passing month without capital retention, you can knock $0.25-$0.50 off my range.
$FNMA slipping out of the channel. A close under $2.68 would be a very ominous signal for Longs as a break-down would almost certainly be assured if this occurs.
The market is suggesting all of the positive news has already been priced in. That means any positive developments will be met with more Sell The News events in the near-term.
Now that is a winning strategy for $FNMA, LMAO
#KeepTheFaith
Waiting for the capitulation selling wave to take hold of $FNMA. We're definitely getting close considering the dwindling volume.
It's coming amigos!
Let's just hope Bruce Berkowitz doesn't take control, or Commons are in for a rude awakening!
I'm sure they can sell shares pretty much anywhere they want if they line up the buyers
Seems unlikely for Commons to get Cancelled, but it's still within the realm of possibilities, especially if the economy stalls.
I think they start issuing big blocks ($20-30 Billion) of Common shares at a significant discount to current prices to encourage new money to buy more ownership.
The recap needs to begin soon, or it will be more painful for Commons as the GSEs will have to raise more money in a short time frame at a lower price.
If they issue new Commons at under $1.00, would you buy more shares? I might even grab some again if $FNMA goes sub-$1
And if we lose that, then what? More waiting for the Gov to do the right thing?
If we lose the 5th En Banc, Commons are toast.
#StickAForkInEm
Do you think this is this why we're seeing a Rotation out of Commons and into Preferreds?
I'm trying to understand the recent under-performance of Commons in comparison to Preferreds.