Fannie Mae-No Politics (FNMA)

[kthomp19]

Why not $33 billion? That is the amount of JPS on the balance sheets.

The discussion in that thread was only about Fannie.

Do you expect the JPS-to-common conversion to come with a 42% haircut on par value?

That's a separate issue, but it would be very easy to offer the juniors a conversion that looks like a haircut on paper in terms of discount to stated value, but could be at full stated value or even a premium to it if the exchange price is set appropriately. This is what happened with Citi: the preferred-to-common conversion was painted as a haircut but it was executed at a pref:common ratio 3x that of the previous day's close.