Fannie Mae-No Politics (FNMA)

[kthomp19]

you conveniently leave out that JPS has lost significant value also during the shutdown.

My leaving that out was not convenient, it was intentional. The junior-to-common exchange will most likely be similar to Citi's, which depended on the prefs' par value and the common market trading price, but did not depend on the prefs' market trading price.

An exchange at 85-90% of par at $3, for example, works no matter what the prefs actually trade at.

My point stands: there is no guarantee that the common share price will greatly appreciate (or at all) between now and the pref-to-common exchange. Whether or not the pref share price does so is irrelevant because the exchange will only be based on par value, which is static.