Fannie Mae-No Politics (FNMA)

[kthomp19]

You seem to indicate that the FHFA will adminsiter a future Conservatorship different than how they will resolve the current one?

Maybe, but I don't see how it's relevant.

IF the US Govt can steal from current common shareholders what stops them from doing it in the future no matter how long between the thefts?

Nothing. No assurance that this administration gives can bind future administrations. That's the whole point: anyone investing in the FnF re-IPO is taking a significant risk due to the great power HERA gives to FHFA over the companies. That will push these investors to insist on a margin of safety, i.e. a lower offering price.

Do you disagree that the FHFA should look to the insolvency principles and procedures relevelant to US Depository institutions in the FDIA?

1) What I think is irrelevant, but Calabria's views are relevant and according to that paper he seems to agree with this.
2) FnF went insolvent in 2008. I don't see what that has to do with getting them out of conservatorship.
3) Calabria thinks FnF shareholders should have been wiped out in 2008. That is what he would have considered the "fair treatment of shareholders" at that point. His use of that idea in his paper has nothing to do with how current FnF shareholders will be treated upon exit from conservatorship.

Isnt your opinion based on the assumption that the FHFA will interpret HERA to implement the maximum screw to existing common sharholders and then try to convince future investors that the FHFA will have a different intepretation of HERA going forward?

No. FHFA doesn't care what the common share price is. Instead it is the re-IPO investors that want the lowest per-share price at the offering. Since FHFA has no fiduciary duty to shareholders, it has no reason to try and prop up the share price.

None of this has to do with interpretations of HERA.