Fannie Mae-No Politics (FNMA)

[kthomp19]

Look at you, smooth move!

Don't get me wrong, I still lost a lot of money. I didn't react fast enough to unload everything (surprisingly the problem was not liquidity because most of my pref holdings were in the very liquid series FMCKJ at the time), and I put a lot of that money back in before things bottomed out. For example, I thought FNMAS at $3.00 was a pretty good deal. I still got hammered overall, but the trading and volatility have salved some of the burns.

I think in TH's piece this morning, he mentioned that the SCOTUS, by ruling that the FHFA is a Government Conservator that they can self deal UNLIKE TRADITIONAL CONSERVATORS!

I will read that soon; all of his pieces are must-reads for FnF investors.

Since HERA was apparently a cut and paste of the 1980's S&L crisis rescue legislation, does that mean going forward that any banks going into conservatorship are subject to the Government Conservator self dealing and selling assets for the "public good"?

That is certainly a fear I have. Jeremy Cain wrote a great tweet about this, showing that even FDIC conservators have their own "self-interest" clause.

As bad as the Collins ruling was for shareholders, its potential precedential effects are even more chilling.