Fannie Mae-No Politics (FNMA)

[bcde]

"Why is there a need to convert jps?"

There is no need for any company to convert debt in to equity if the company does not have any liquidity problems or debt servicing problems.

Debt conversion to commons is the well known mafia strategy of loan sharks. They are always looking to wipe out commons and convert their debt into commons at highly discounted price.

In case of FnF:
1. they are highly profitable,
2. they have very high liquidity and good cash flows,
3. they have very high quality assets,
4. they do not have any debt servicing problems,
5. they never have the problem of run on deposits like banks
6. They are stress tested and their current capital levels are sufficient to withstand any counter cyclical demands
7. they have very viable and successful TINA business model.

Before conservatorship FnF were very well capitalized. They are low in capital after 13 years of mafia conservatorship. Mafia conservator plundered and robbed all their capital in the last 13 years. Even now FnF can build their capital easily if mafia conservator stops robbing them and courts stops supporting mafia conservatorship.

Courts have to realize that they are undermining the basic foundation of the country with their support for lawless decisions of FHFA conservator. Eventually common citizens will end up paying for these lawless decisions of the FHFA conservator and the support of the courts. Courts should put an end to this mafia conservatorship. The amazing thing is USFC has used word mafia to describe the conduct of FHFA conservatorship but plaintiffs are so timid to use this word themselves in their filings.

The best option for FnF and all its stakeholders are:
1. Set SPS to zero as fully paid
2. Continue the support of SPS at free market rates until FnF are fully capitalized
3. let FnF buyback warrants at nominal price
4. Let FnF decide on how best to build capital without destabilizing the markets

It is as simple as above and does not require any great financial analysis.