Fannie Mae (FNMA)

[Louie_Louie]

Nice and concise post.
Agree.
Fact is we're all in the same boat yet preferred holders have some idea they will get a conversion, when the reality is everyone will need to ride their investments through this and let the dice fall where they may.
But the government can still say no dividends to both pref's and commons after release, yet this would cap the upside of pref's way more then common.
It has been reported on much that if government screws the common that their wanting to re-ipo or sell more shares would not work do to trust in the government and future. Also, no investors want in on a stock that government controls 79% after release.
If they offer shares (Re ipo) and withhold a dividend on commons, that would not work out for them, so I beleive to reinstate a common dividend that pref's will be given some deal at par or lower so that new pref's with lower dividend payments can replace the old.

the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 warned all investors in Freddie securities, including investors in shares of preferred stock, that they “not be construed” in thinking that the GSEs would “honor, reimburse, or otherwise guarantee any of their obligations or liabilities.”