Fannie Mae-No Politics (FNMA)

[kthomp19]

(15:11) "A public offering of this size would be feasible, but I do want to EMPHASIZE that ultimately, that's really going to be on Fannie and Freddie's job to do"

This doesn't prove me wrong at all. Of course Fannie and Freddie have to do the capital raise; FHFA doesn't have any shares to sell!

(15:28) "Again, I forget how many times AIG went to market, for instance - but you know, this doesn't have to be done at once. The GSE's don't need to leave at the same time, there's multiple way to take a bite at these [apples]"

This also doesn't prove me wrong. The topic of discussion was whether or not one big capital raise would be possible, and Calabria said that multiple parties told him it would be. That is in direct contradiction to TRCPA, who said it won't be possible.

Multiple raises wouldn't have to necessarily have long times in between either. It could be three or four medium-sized ones (totaling $100B) in a 12-month period, for example.

I do want to thank you, though, for keeping the discussion going. Being able to sharpen my views against dissent is always valuable; echo chambers don't do anyone any good.




Just to get your opinion, do you think multiple raises are possible when investors in the first one won't know how much future raises would dilute them? I think the only way it would be possible is at a very low share price, likely lower than where the commons trade today.

And if they did know how dilutive future raises would be, what would the purpose be of putting off the later ones?