Governement exercising the warrants is not an option, as follows:
1. Perhaps the compelling reason is that the government, upon exercising the warrants, would become the major owner of the company, and be responsible for its 3.1 trillion in debt. If you own the company, then you are responsible for its debt. The government has already repeatedly declined adding the 3.1 trillion of fannie debt to its coffers for some very very good reasons. Most importantly, most economists believe the 19 trillion in debt is already unsustainable, and another 3 trillion would be the straw that broke the camels back. With the combined debt of over 5 trillion including fannie and freddie, this amounts to increasing the national debt 26%, which would have disastrous consequences, and could cause China to "pull" all of its borrowed money out of the US, where America's excessive spending could come crashing down like a borrower who ran up too much credit card debt.
2. By "taking" over 50 billion in excess dividends, AND many more billions from profits gained by exercising the warrants, the US government motives for the conservator ship just got clearer: They wanted our money. They are avoiding an appearance of impropriety even when/especially when the evidence shows otherwise.
3. The government has stated that they do not intend to exercise the warrants, essentially as that would be an admission they "took" the company from shareholders. The US Government is clinging desperately to the postion, "we didnt take anything from shareholders, we just got paid interest on the loan". Well, exercising the warrants changes all that.
4. Trump wont let it happen, he has made it clear by selecting Munchkin that he wants fannie privatized, and exercising the warrants is in opposition to that position.
