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Looks like Ackman sold out with that drop. Ouch! The Lemmings need AJP V2 to "keep the faith."
Otherwise, we've all been through this rodeo and we know how it ends -- slow and continuous drops until we hit the Dollar Value Menu.
#It'sComing
#PreferredLifeIsGood
Preferreds would Convert to Commons at Par, and then participate in any upside Commons may have. If the Admin does the Average Joe Plan ($1,000 per share), then Preferreds could see another 100x on top of their 3-4x Par conversion.
If it means Par and potential 3x upside on top of the Par conversion, I'd be willing to swim with the swamp creatures that live in the dirt at the bottom of the capital structure (aka, Common shareholders).
Who knows, maybe down there I will be able to find the SEC Letter stating the Warrants are legal and find clues as to where the super secret escrow account is that stores all of the GSE NWS funds.
There's a lot of things lost in the dirt among the bottom dwellers. It might be a gold mine of information.
GSE's BOD agreed to the amendments. Common shareholders have no voting rights, so their opinion would not have mattered.
"Some preferred shareholders seem to think that if you sit on the preferred through the conversion and hold on for a few years, the common could then appreciate significantly making you as much as 3x par value in the next 5 years."
Thanks Glen. You can put me on the list of Preferred Holders that agrees with this.
Show me Conversion at Par and I will gladly become an Average Joe (somewhat unwillingly, though).
If you're banking on a Legal Ruling, you're going to have a bad time. This gets settled behind closed doors and Admin Action decides our fate.
Hopefully the majority of the Lemmings hedged their bets like Ackman and don't get burned by the Good Ol' Boys Club
We're literally seeing millions of shares traded each day.
Not to mention, there will be tons of shares on the market after the dilution starts to occur. Shorts Paradise!
No money will be "shifted to Preferreds." New money takes over the larger percentage of ownership and starts calling the shots.
Preferreds just enjoy the benefit of having recapitalized companies and hopefully receive dividends while existing Commons get bullied even further down the capital structure (lower than dirt)
I didn't say Commons would be canceled in that scenario. They just get diluted significantly (ie: current shareholders end up with about 3-5% of the companies).
There's plenty of other potential scenarios where Commons do get Cancelled though. The one I outlined is one of the best case scenarios though.
What about the SEC Letter that's been touted? That thing says the Warrants 100% cannot be exercised under any circumstances.
#ThingsThatMakeYouGoHmmm
Expect 100% of the 79.9% Warrants to be exercised
Of course the Warrants will be exercised! Treasury fully intends to keep the Warrants. See my signature.
Shorted another 10k $FNMA at $2.42. Crash & burn time for the Average Joe's
Glad I sold this turd at $2.80 yesterday. What a joke! I was told this was going to $10+
Another court loss and we may retest the December Lows
$3 was the game, now it's business. Down always means games/manipulation, but Up means "it's coming!"
$2 seems likely, maybe $1.60zzz if oral arguments suck.
Settlement Leak!? Commons left out in the cold? Surely a possibility
Expecting a drop back to $2 this week. Timber Alert!
With weak oral arguments in Collins, we might see $1.60zzz
Yikes, Gap & Trap confirmed. $FNMA Lemmings stuck. Now what!?
Gap & Trap day? $FNMA flop seems likely today when you consider the facts.
Indeed, the irrational exuberance continues to be elevated. $FNMA is overdue for a large reality check (correction).
$FNMA is up many multiples from the lows of 2011. All the gains are practically gone at this point.
$5 was a once in a lifetime event. Don't expect it again.
How do I get on the VIP list? I have a large short position on $FNMA, so eventually I will have to buy $FNMA to cover. Doesn't that technically make me a Common shareholder?
#VIP@TheWynn
It is over, Amigo. But where Commons end has not been determined. Or has it?
We'll find out very soon, amigo.
Preferred Life is Good.
But the GSEs received taxpayer money! If the Gov used your money, wouldn't you want to be compensated for it whether it was needed or not?
We can't have privatized gains and public losses.
This is a great point. Taxpayers put a lot of money on the line, they deserve to be compensated more than shareholders.
Warrants + SPS conversion. Count on it! Commons are probably worth ~$1.75 in this scenario (aka, currently overpriced).
The Treasury can't give up the golden goose so easily.
Otting could throw cold water on the Release news by announcing the low dollar pricing of new Common shares that will be used in the Recap.
Knowing Mnuchin, I would fully expect it as he wants to prevent the "Hedge Funds making money off of the taxpayers" narrative
Selling Commons to raise capital is the Plan. It doesn't matter which plan the Admin follows, they all require equity capital raises.
No way around it. Expect it
Irrational exuberance on every day $FNMA is green. The Lemmings might be in for a world of hurt depending on the details of the Recap Plan. If Sr. Preferreds convert, it's quite literally Curtains for Commons.
Much too early to celebrate.
#DevilIsInTheDetails
Unless they announce the IPO 20% below market value. I can definitely imagine that day, I hope others can as well. Because it wouldn't be pretty
Indeed, the irrational exuberance is higher than usual.
Commons are now very close to fairly valued in my opinion, at least until Otting reveals the Recap/Release details.
The devil is in the details. Will Otting treat Commons fairly or will he stick with the Good Ol' Boys Club and unfairly enrich Preferreds?
Stay tuned! Expect high volatility
That's not what Ackman said in his last shareholder update. He actually said the opposite, stating Preferreds may benefit more, hence his reasoning for buying a nice chunk of JPS to hedge his bet.
Do you have a link which shows his new stance on Commons/JPS?
#Read
Did Ackman announce he sold Commons yet?
This is still in play. Stay above $1.60 or things will get ugly for $FNMA.
Weak oral arguments in Court next week will likely have Commons testing the December Lows.
That's awesome! Can we see the SEC Letter? I'm curious what they have to say about the Warrants.
LOL! Too funny
Twitter buzzing about Ackman reducing Pershing-Square's Common position
Will he announce the addition of more Preferreds?
More importantly, what does it mean for Commons?