Fannie Mae-No Politics (FNMA)

[kthomp19]

does it matter if Scotus provides direct guidance to the lower courts or does it themselves?

Yes. You assume that the Supreme Court will specify a remedy. I think there is a good chance they don't do so at all, only telling the Fifth Circuit that one should be available and decide on what form it should take; the Supreme Court would get to decide later if they like that remedy by granting or denying cert on the inevitable appeal.

You're arguing timing, which actually goes to more retained earnings and then, after Scotus, possibly a settlement.

If what you assume is correct, that the Supreme Court will decide the case once and for all, there is no "after Scotus", and thus no settlement to that case at all. That's another 3-6 months of retained earnings from here at most.

If the remedy for the constitutional claim is remanded to the Fifth Circuit the timeline for a final ruling is pushed out 1-3 years (time needed for the Fifth Circuit to apply their remedy and another petition for cert which could be denied or accepted), and even more if the constitutional claim is denied but the APA claims are remanded to Judge Atlas (discovery, trial, appeals, etc).

It hardly matters in terms of retained earnings towards recap because Freddie is still 18 years away from the 3% CET1 threshold, and Fannie 21 years.

The above is fact.

No, it's a falsehood. The "fantasy" Tim Howard referred to is not "JPS", but instead "the notion of a simultaneous settlement and massive private placement of equity with new investors". You have taken his quote completely out of context. A public equity offering, for example, was unaddressed by him, and thus you cannot say whether or not he thinks that is a fantasy.

The fact is that Tim Howard owns commons and juniors, but chose to sell some of the commons and none of the juniors. Actions speak louder than words.