Fannie Mae-No Politics (FNMA)

[10yrsholding]

Actually - forgiving the seniors is an obvious win for Treasury. Treasury owns 79.9% of fannie and freddie, so let's say they forgive $100B. The value of f&f will immediately increase by $100B,

Not saying this will happen and meant more to argue cap stack understanding, but a better win for govt. (maximizing profits) would be to convert both senior preferreds and warrants immediately prior to the re-ipo? Tax payers maximize their payout, politicians get cover on screwing the hedgefunds that hold the equity, preferred suits goes away with the conversion of the seniors, new shareholder's are not harmed nor worry about the cap structure overhang.