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If Ackman reports and didn’t sell preferred to buy more common, like he’s alleging other preferred shareholders are doing, especially after he says that common outperform preferred in almost every scenario, then what?
That will be interesting.
$10? Maybe in 10 years...
Shitshow.
Technically, only cases that NEED to be settled are ones with Judge Lamberth, because the claims are against the GSEs themselves. If Treasury indemnifies the GSEs, then no cases need to be settled.
Although there are plenty of other open issues...
Senior preferred aren't all or nothing.
You are exactly right.
If there's going to be a settlement, you have two sides negotiating around the following break even for the senior preferred shares...
$125 billion plus ~7% interest is close to offsetting the liquidation preference.
But government has leverage: time (they can appeal forever w/ 10% dividend on $190 billion greater than 7% interest on $125 billion) and the fact that the GSEs never paid a commitment fee on the undrawn portion of the liquidation preference.
It's completely reasonable for the parties to agree to a calculation that nets the government $10-20 billion of additional shares of common at fair market value.
Post a citation for this preposterous claim.
Always funny to see people cheer down days for preferred... if preferred don't get par (or close to it), common will be nearly worthless... common need to cheer for preferred more than anyone so they have a chance to eat after government, preferred and new investors have filled their bellies.
Tim Dillen bump at open.
Government can't sell their SPS until the GSEs are recapped / timeline to recap is set... which brings JPS to par... common can be diluted to hell and JPS can get par value... think.
$200b minus $95b = $105b... these are your numbers, not mine... liquidation preference is ~$190 billion.
You’re short.
Difference getting converted to common.
Ouch.
SPS does not disappear either way.
READ THE PRAYER FOR RELIEF IN THE COMPLAINT!
One remedy has NWS overpayment returned and SPS remaining, other has “10% moment” treatment.
“10% moment” isn’t a real concept in the PSPA. It’s made up.
Judge Atlas probably won’t rule for some fairytale accounting. GSEs will get their overpayments back and SPS and 10% dividend survive.
Why would government give up $190 billion senior preferred to settle a $125 billion judgement on NWS issue?
Is your calculator broken?
GSEs had 30 days after conservatorship executed to file an injunction and didn’t. 30 days is enough time to overcome the claims of duress and coercion.
The only legal solution is the one that I outlined.
Anything else probably can’t be ordered by a judge.
Your platitudes are meaningless.
$125 billion vs. 10% dividend. $190 billion senior preferred / liquidation preference still the government’s to monetize. Get it now?
Redemptions. Berkowitz doesn’t necessarily control his own fund. It’s a shame. “Premature accumulator.”
Who cares about institutional ownership?
In a world that would be in accordance with the original PSPA... also a remedy that the Collins Ps requested... also what Judge Sweeney would consider.
This is happening.
Maybe the government settles another way, but this will be the judgement: ~$125b (plus interest?) back to GSEs and ~$190b SPS in tact for government.
Start getting used to it.
Good work on this, Navy.
Anxious to make sure that people get appropriate information and aren’t misled by someone who has no idea about what they’re talking.
Tim Dillen needs to delete his tweets. They're wrong and reckless. Hopefully someone lets him know (I'm blocked).
There are several examples included here that refute the assertion that cert has already been denied:
https://twitter.com/HoldenWalker99
Lamberth is Fairholme and Arrowood.
Sweeney has a bunch of Ps.
Atlas - 5th Circuit En Banc - SCOTUS — Collins (NWS and FHFA structure)
Sweeney — Fairholme, et al (derivative claims against government, $$$ only)
Lamberth — Fairholme, et al (direct claims against government and GSEs)
Rude.
Probably neither. My guess is that he’s not that experienced or not very smart (and shouldn’t be posting things so definitely that he doesn’t understand).
Nope. They also can grant cert after Monday.
Typically they don’t grant cert on the Monday after a conference. Denials only. You’ll have to wait a few more days.
No cert today means just that - no cert today.
SCOTUS will deny cert Monday or grant cert after Monday.
Tim Dillen is wrong.
SCOTUS is coin flip. Better to get judgement from Judge Atlas in accordance with 5th Circuit decision on APA (NWS) issue.
Tim Dillon is #FAKENEWS.
It was the Ps who requested the delay, not Sweeney. Try again.
WHERE'S CRYPTONATOR?!
HELP!!!
14-day extension in Sweeney's court...
https://twitter.com/HoldenWalker99/status/1215714078703919104?s=20
How would they schedule a hearing for January when the conference isn't until today?
Tim Dillen is a real sleuth. No Collin oral arguments in January yet? No kidding!
4 X 300% = 1200% better?
Is that the math?
It'll be fine. Capital rule will be done by June.
Calabria isn't the problem. He'll do what he needs to do when he needs to do it.
It's balancing the courts and politics which is mostly Treasury on behalf of the administration.
There was some pressure to re-propose the rule in its entirely even though only a few parts needed to change. Independence from Watt. Allowing outside counsel (financial advisor) an opportunity to provide guidance. This dialogue took time to hash out.
Additionally, and this is just conjecture, delaying the capital rule allowed FHFA to push their timeline in accordance with the administration's plans. If finalized already, what would they be doing for the next 6 months?
Timeline is tight now, for sure, but we had a rule already, two 60-day comment periods and over a year to review and re-propose. A release in the next 4-6 weeks leaves enough time. A further delay makes it really tight.
Sweeney (and Lamberth) trials won't start until 2021.
SCOTUS will hopefully send it back to Atlas.
Hopefully that's enough for the government to get moving.
Or Atlas could make a ruling that could be appealed to 5th Circuit and then to SCOTUS all over again.