Fannie Mae-No Politics (FNMA)

[big-yank]

Fannie Mae profit is higher because it stopped paying dividends to both common and preferred shareholders in late 2008,and because it has raised guarantee fees at the direction of FHFA.

The $60 S/P often tied to a released and recapped Fannie Mae is generous, and should be hugely attractive to investors, everywhere. The other thing to add value in these equities is the restoration of dividends. A long term holder of common shares could be considering a restored 2007-level dividend of $2 per share on a stock bought by many at $.25. This is the real money maker in this deal. A $2 divvy on a $4 stock, even as it sits today, is a thing of beauty. And if Fannie gets through RRR and these court actions without plaintiffs punishing the GSEs in too costly a way, it would become the world's highest paying annuity with very little risk.

JMHO.