Fannie Mae-No Politics (FNMA)

[Potty]

Louie, the CET1 capital has to come from somewhere. Getting enough capital interested in a raise of this magnitude is no small feat

And don;t say what a wonderful opportunity GSE's are -- the political risks are real, the regulation is pain in the ass, and the history is toxic

Getting $33 billion in capital in a conversion a no brainer, since you could lock in that capital BEFORE the offering of new common and hence lower the burden for that massive offering. Like Citi, one converts at the average price of the common for the previous 30 days - what could be fairer than that? Market price.

That makes the offering of new common smaller and hence more viable - and less expensive...

A Kthomp noted, and as I posted yesterday, JPS conversion is an option explicitly mentioned in TREASURY PLAN and then included in most recent FNMA 10-K by Calabria. This is not just people mentioning conversion, but the only people with power here -- Mnuchin and Calabria

I find all of this, and points raised by Kthomp, Michael Kao and others, very persuasive. But we can all make different evaluations and then make our own investments accordingly... GL to you and all longs