Fannie Mae-No Politics (FNMA)

[YanksGhost]

The erosion of JPS share price could be the straw that breaks the back of any settlement with litigants who want something as near to par as they can negotiate to effect a conversion to common. This seems all the more important with FHFA's kiting of the CET1 fortresss requirement. Some litigating JPS shareholders have indicated they expext to take some haircut vs. par. But I doubt they would accept any deal where 1 $25 JPS gets 1 to 2 shares of common because they then get hammered by the same dilution as commons in the IPO phase.

I am increasingly thinking that NO recap plan can go forward until Treasury declares its intentions on warrants and senior shares. No IPO of any amount can be sold or even priced without both Treasury's posture being known and the lawsuits being settled. And the narrowing of spread between JPS and comon shares only complicates everything further.

Very vexing.