Fannie Mae-No Politics (FNMA)

[Donotunderstand]

Aside from the ????????????? pps of an SPO AT 158 ----

I wonder about the logic of this statement

If the Treasury will cancel the liquidation preference, as the government’s been paid back in full plus 10 percent interest


While I hope the GOV calls it even - 300B for 200B or whatever

the arguments you present fall off the table - In my personal opinion - when you talk about interest paid as if this was a declining balance loan which it was not

right or wrong - do not shoot the messenge - the money advanced from the Treasury is viewed as Senior Equity investment not a loan and everything paid out so far as EARNED dividends (not interest)

By accounting principles and the exact language of all documents describing the inflow ---- nothing has been paid back yet - that is the reality !!

Now - can the GOV agree to kill any pay back obligation on the equity senior paper investment --- SURE and I think the argument is strong for that ---- but ---- I then see the GOV able to use its Warrants

That gives Treasury an incentive for higher v lower PPS for that exercise (forget the SPO for now) ---- so think say $30 a share and all such money - by pre written agreements and prospectus and executive order is then - to get DEMS on board - kept in a trust to be used for low income WORKING people (recall the author who suggested breaking F into two companies so this is a bit easier legally)

Summary
I hope the GOV negotiates a drop of pay back - but in real terms nothing has been paid as its all dividends
I assume the GOV may well do this but then want to keep the WTS - which IMO is fine -- for those of us interested in say $20-$40 a share at the ceiling
Then we do not actually need an SPO !! the GOV can agree to be a back up re insurer until we reach such agreed to level of capital via earnings 9say 4 years)

All a wish