YanksGhost Saturday, 08/11/18 05:14:09 AM Re: curious999 post# 470154 Post # of 601704 You need to study financial accounting. The day junior preferred shares are converted to common stock, the GSEs have a combined writedown of $35 B that gets removed from CASH, because that is where the proceeds from the junior preferred shares were recorded when sold. The preferred stock was entered as a minus number as PREFERRED STOCK and a positive balance sheet entry as CASH. There will be no miracle rise in S/P until year 3 when Moelis envisions issuing $20 B in new junior preferred stock to restore 60% of the cash assets drained with the retirement of all the old preferred shares. Several people, here,have asked why Moelis retires preferred shares and then sells more, later on. The answer is that slight-of-hand accounting is being used to conceal the motive which is to restore a combined GSE enterprise to where it previously stood and own 50% of its common equity in the new enterprise. How much do you think 50% of the combined market cap for the New F&F will be worth once RRR is complete? $100 B? $200 B? Today the common shareholders would own 100%; IF warrants get exercised, they own 20%. Under Moelis they own 10%. This is nothing but a classic Wall Street cash grab, IMO.