Fannie Mae (FNMA)

[familymang]

“In which way can it be irrelevant about something being illegal if there is not a relevant law?”

Because Treasury has the final say in what it does with its stake. So even if they are incorrect on this interpretation of the law (which i highly doubt they are as they came to this conclusion with consultation of the DOJ after months and months of evaluating all restructuring options), its irrelevant because thats the view they will take to determine what action to take. So their interpretation of the law is all that matters in regards to what to expect in a restructuring. My opinion or yours or anyone elses is not relevant.

They claim writing down the senior preferred in full or part is not legal. So they wont do it. Treasury already told that to FHFA (Calabria), and the compromise was an equal conversion of snr pfds and jr pfds to common as Calabria explained that was the only viable option treasury was on board with.

P.S. even if they randomly have a change of heart and decide it IS legal, there is still the political reason why they won’t do it as Calabria explained in his book.

Calabria just gave us the cheat code of what can we expect from Treasury in a restructuring of the snr pfds (conversion) and people on this board continue to ignore reality + he gave us 2 impossible hurdles to overcome why a writedown wont happen (legal and political).

The only way to overcome these obstacles is through a court win, and I wouldnt place high odds on that thanks to a court system that ruled 1) the NWS is a legal act of a conservator and 2) the NWS wasnt a takings.