Fannie Mae-No Politics (FNMA)

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"Fannie/Freddie Research Report Dispells False Narratives"

Those investors who are hoping that there will be lucrative and rewarding conversion have to keep in mind that,

1. FnF will be completely in charge of capitalization process without any deadlines. This overrules any pressure to convert existing JPS or go for highly discounted SPO. Also during this time there will be no pressure to pay JPS/CS dividends.

2. FnF have the option to capitalize based on only with retained earnings and DTA taking as much time as it takes without ever going to capital markets. During this time FnF can also buy back JPS and CS at discounted prices and boost the PPS.

3. The biggest unanswered question is, disposing off warrants. If Gov exercises warrants then the chances of JPS conversion or SPO are ruled out. It is highly doubtful whether Gov will ever make more than $10B to $20B on warrants.