Fannie Mae-No Politics (FNMA)

[Louie_Louie]

The government says a minimum capital needs to be attained before release, yet no one really knows that number or a max number, and they keep running stress tests that say the GSE's have more than adequate capital already....hmmmmm. do ya think maybe, just maybe they'll end up released with way more capital than they need? The goverment announces that they are over capitalized at release,,the stock prices go up, and their warrants are canceled. That would give them seniors, which they could, yes convert, but not liberally, or they risk scaring true investors away, but if stock flies high enough, they could cancel some seniors and convert the rest as a buy off to get the hell out of the GSE's . This would be a win, win, win for government, current investors and new investors, but leave jps as is. There are absolutes in this formula...government must get out of owning anything GSE or investors will assume an anytime take over - again. The capital raise is on going, yet no one is comparing real world stress tests the GSE's went through, to capital on hand. Don't be surprised when JPS stay as they are until a dividend to them is announced a year or more into release. Jmho