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Quote from an article, makes too much sense!
Fifth, the government should not play favorites among private shareholders. There have been rumors about allowing preferred shareholders to convert into common stock, or allowing a limited rights offering to certain shareholders. This will lead to disputes and delay.
The contractual and legal rights of all shareholders should be left in place and respected equally. Anything else will be seen as playing favorites to Wall Street hedge funds that have invested disproportionately in the junior preferred stock. The contractual rights of those shares should be respected, but not favored over those of common shareholders.
Thanks
Corrected post to commons canceled:
Yep, no volume, no liquidity, no dividend, no direct claims in court, no growth potential, no conversion, no bankruptcy, non cumulative, no future, so yeah, irrelevant for sure.
If it is such a great idea to do a pref conversion to commons, then why has the government not done it already? None of the pref holders seem to provide a reason. No court case addresses conversion. Pref's bet all their money on a "maybe there might be a conversion" stated a long while ago, at a different time, during way different circumstances.
When government said no windfall for shareholders, they meant ALL shareholders. Why pref's quote this statement and take it as a given that it only applies to commons is part of their problematic reading comprehension and tactics of splitting hairs.
I will settle the pref's conversion dilemma.
I am making a one time offer : 100 pref shares for 1 fully licked and stamped S&H green stamp book. Hurry while supplies last.
Today:
FNMAS VOLUME 219,831 price -0.18
FNMA VOLUME 2,600,000 price even
You were saying?
Yep, no volume, no liquidity, no dividend, no growth potential, no conversion, no bankruptcy, non cumulative, no future, so yeah, irrelevant for sure.
Soooo, Lown might be another cLown?
Guido, I commend you for your solid points refuting these hair splitting partial truths pref holders. Their conversion will not happen. We will be released and court cases settled somehow, then the bod, financial advisors and government will determine at that point, what, if any capital raise is needed. Pref's saying conversion before court cases are even settled is a pipe dream. They are looking at 2 more years minimum with no coupon divi payment and possibly much longer if there is a staggered set of capital goals that must be met.
AND you have no conversion powers!
That is perfect description of a GSE shareholder! Groundhog day feeling like Phil Connors.
Okay, then as you guys think, common holders should ALL start calling for a conversion of 200 pref shares for 1 common right now! Who cares if it's fair and...don't go suing ya guys. Lol
Yes! Absolutely. The enemy of my enemy
Yeah for sure! FNMAS following right behind commons.
Please stop with the nit picking of FNMA. be brave and post both closing prices, otherwise you are looked at as FOS.
Agree.
There are smart informed people on here who could together structure a dam good proposal, in my opinion.
Good post!
Many are angry due to the corrupt government, judicial back scratching going on....and I do not blame anyone for being angry about that one bit.
Folks need to mellow out on this rule...there is a comment period, with hopefully a revising of the rule period to something saner. The former GSE CEO's commenting in public and in the media is good, but they really need to certify their opinions and actually comment on the rule to the government, through the process set up, otherwise they are talking through their hat. I think many will comment and drive this rule to a saner more robust end. Devil is always in the details, and we know many of the details on the "proposed rule". There is a chance many of these details change or evolve, so let's all keep our cool and see what happens.
Those debating the rule right now are only practicing a futile guess at what the end result will be. It would be much more productive, and better, to come up with unique and stronger ideas, make a list here from all concerned posters as a group and then submit on our groups behalf.
That's gonna be a long while....buy extra TP with your money instead of pref shares, it'll help with the hurt later.
He never specified any exact shareholder also, which PREF SHAREHOLDERS seem to constantly overlook.
I am with Golf on this happyalways.
Pref's really do need to realize they are not the center of the GSE universe. Yes, they have their place in the capital structure, but we are in conservatorship until the government says we are not. Until then, no one has any pull or special privelege. It just happens that commons are more prone to uptick on good news and are more widely recognized for their benefit with voting rights once released...
Government will keep things neutral, that is my premise. I am capitalist 100%, but GSE's aRe special situation that got made even special through the years but the previous corrupt administration. This administration is trying to rectify things, but I do not see them playing favorites with anyone.
Courts are a blue herring, this is for sure. People comparing Citi really need to look at size of companies, importance to economy, cap requirement and boat load of other stuff before comparing CITI to the GSE's. It's apples and oranges as we've been saying for a while. Example: I highly doubt Citi had the NWS implemented 5 years into conservatorship.
Just my opinion.
That I can whole heartedly agree with.
The government is good, you might even say great, at scamming the system. But then, they created it.
Nope...buying at par gives many JPS the "windfall" since most have bought below par. Government and financial advisors will come up with an average based on purchases for a time period. Some pref's will do better than others, but those who bought a $50 par pref for $7, I highly doubt will get $50 or $50+.
Last buyout number the pref cheerleader Pelagria (sp?) Bounced was 80%.
I'm thinking there may even be a laddered payout to pref buyers based on when shares were purchased.
Remember the words...NO WINDFALL. that mean pref's as well as commons. Anything the government does special for pref's is handling them like a direct claim, and would need to do the same for commons.
Yank, if I can dig out my post....I pretty much said this same thing months ago (3, 4 or 5).
Back then pref's were more on the liquidation band wagon still.
I pointed out: commons will stay commons, no special treatment, and likewise for prefs. I also pointed out commons had stock price growth potential while pref's would have to wait for a capitalization goal to be met before a dividend coupon payment is made . I predicted 2 to 3 years. I stand by that still. Pref shares will lose in price the longer the dividend is turned off, as you said, and I agree. It will be at that point that the GSE'S start to buy back the pref's and probably close them out, especially the high interest ones.
There is a method to the government and financial advisors madness. Pref's are like the picture of the monkeys with hands over eyes, mouth and ears, all the while saying LALALALALALALALA
Nope...not a fact. You really have a hard time distinguishing between "fact" and opinion/conjecture don't you?
I was hoping someone would get it.
But eventually they pout and yell like now! Who moved my cheese! Lmao
Sticky
Hopefully it will help the pref people......eventually
+billions
Why do the GSE's even have a preffered class? Pref's please explain..... the government and the market has already shown that the GSE's are invaluable for bailing out the taxpayer mortgagor AND the banks along with the small mortgage companies, so how in the world do prefs ever get "liquidation" - bankruptcy? They are paid a coupon dividend for the use of their money, so exactly like a bond.
Attached is a list of all government fhfa, treasury and court judges who have advocated a pref conversion:
Excellent facts.
Can we sticky one of these cap rule links?
Things seem to be happening just before holidays with the government...I'm guessing release consent decree by around July 4th
Wasn't it pref holders, not too long ago, quoting ACG people/process and saying NO CONSENT DECREE and that they would get their massive conversion before that or release?
Perfect
Definitely +1
Cross your fingers...hopefully relist price is coming soon.