Fannie Mae-No Politics (FNMA)

[stockprofitter]

GIVE IT TIME ( FNMA )

STRONG SHORT JUNIOR PREFERRED

Big SHORT positions are being taken up, just look at the SHORT increase in the latest two sessions!

SHORT GSE THESIS:

1. FITCH & All Other ratings agencies rates GSE Junior Preferred Junk

2. HERA : GSE JUNIOR Preferred have risk of being CANCELLED should FHFA director decide to implement part of HERA that allows for companies to be placed into an LLC. JUNIOR Preferred considered a debt/liability; would be left behind in rotting shell.

3. Companies could decide not to pay dividends for many many years while building capital. Nobody wants to hold a preferred not paying a dividend.

4. Junior preferred a non-cumulative; some on ihub seems to claim they have rights to back dividends. Will never happen.

5. All cases are sponsored by large junior preferred holders. All cases have lost, and likely could still lose.

6. Junior Preferred could go way of IMPHO - Impac Mortgage preferred stock. Worthless.

7. Legislation could pass that benefits common and punishes the preferred. This assumes Congress has loaded up on common, and wants to punish junior preferred holders for years of suing the government.

The list goes on and on. Does not look good at all for Junior preferred.

STRONG SELL

STRONG SHORT -> GSE PREFERRED



Enjoy