Fannie Mae-No Politics (FNMA)

[RumplePigSkin]

Guido, per David Metzner, he focuses on the minimum capital, not the buffer, of which I agree. The part I’m puzzled by are the watrants:

David Metzner
@davidametzner
·
6h
There is no cancellation of the warrants. That’s the grease to get recap done.

Treasury owns the warrants. Metzner is absolutely certain, even under a PSPA amendment and consent decree, that a Biden appointed Treasury secretary couldn’t muckup the process?

Leaving anything to the Biden Treasury secretary is risky IMO. I’m assuming Metzner’s supposition is that the warrants will be auctioned off/sold at fair market value to raise capital for the GSEs.

The consent decree would have to transfer ownership of the warrants to the GSEs, or third party contractually obligated to follow the RRR plan, so as to remove a Biden treasury from interfering.

Curious to know how all of that works ... and I may be offbase ...

Some what related, the ACG analytics timeline at the bottom has a footnote related to their capital numbers not incorporating any payments recovered.

Fascinating times ...