Fannie Mae-No Politics (FNMA)

[kthomp19]

You want more, and you want it at the expense of the commons.

Where else would it come from? Treasury isn't going to write any checks.

The junior pref holders have much, much more power in this situation than the common holders. Ackman himself knows this and has taken a pref position specifically because a resolution could disproprtionately favor the junior pref holders.

Taking this a step further, I would bet a large amount of money that if you were to make a poll asking common holders the question "if you could make more money on your investment by screwing the junior pref shareholders, would you?" that you would get an overwhelming majority of "yes" votes. Making money is all that any of us are in this for. Choosing to be on the side of those with actual leverage (the juniors) isn't immoral at all, because morality has nothing to do with this.

So yeah, you don't step into the bucket LABELED "short" but your intentions and desires are no different (with regard to commons) than those of a declared & labeled shortie!

Not really. Ruud just wants the prefs to outperform the commons, and that situation would still kill a short seller if the prefs go to par.

Maybe you could say that he's short FNMA:FNMAS, but that could just as easily be interpreted as a long position in FNMAS:FNMA.