Fannie Mae-No Politics (FNMA)

[kthomp19]

I agree. The idea that Treasury will try to maximize the warrants but give up the seniors is pure cognitive dissonance.

If Treasury is in full maximization mode, they will push to convert the seniors to commons (like with AIG) rather than just giving them up. And since FnF never had the ability to pay down the seniors, a court cannot order them extinguished.

If Treasury is not in full maximization mode, they won't try to prop up the common share price to make the warrants more valuable.