Fannie Mae-No Politics (FNMA)

[contrarian bull]

Warrants and senior preferred are two different things.

The senior preferred are why they still need to pay Treasury almost 200B.

The warrants are a profit-sharing agreement, where whatever value f&f have after the conservatorship - Treasury gets just under 80% of that as a reward for being such a great conservator. In the form of shares of common stock.


And you are right - they can't own stock. That's why they own warrants. However they can sell the warrants to someone else for the value of the stock, or exercise them and immediately sell, without holding the actual shares. This is what they did with most of the other banks they bailed out.

Are the warrants the 79.1 percentage of the stock in thier possession they have been collecting on. If so and the nws has over paid on the balance plus the 10% why would the government be entitled to collect on that as well I'm not to up to speed on that legal part of it. Also I thought the government wasn't allowed to hold stock in a company