Fannie Mae-No Politics (FNMA)

[Louie_Louie]

See below, callable preffered.

The pref holders might be put in a catch 22....If they call the shares before Lamberth's court presides on a decision (back dividends), those who sell lose anything that might be positive out of his court. On the other hand, if they don't follow through and give up their called shares, and then Lamberth screws the case, God only knows what that outcome is. One thing is for sure, this is their conversion! Lol


Understanding Callable Preferred Stock
Callable preferred stock, also known as redeemable preferred stock, is a popular means of financing for large companies, combining the elements of equity and debt financing. Redeemable preferred shares trade on many public stock exchanges. These preferred shares are redeemed at the discretion of the issuing company, where the stock is effectively bought back by the company at any time after a certain set date at a price outlined in the prospectus. This is beneficial for the company if they have issued 5% preferred shares but could now offer preferred shares at 3% because interest rates or preferred share yields have dropped. They can call in their more expensive preferred shares and issue lower dividend rate ones