Fannie Mae-No Politics (FNMA)

[kthomp19]

Here’s something to ponder: I just read a clip from Paul Mampilly in January. Where he thought that the Government was getting close to turning back on the preferred dividends in a form of re normalizing the Twins. Would that basically solve the preferred’s problem?

Yes. Turning the junior pref dividends back on would bring the trading prices of most of the series pretty close to stated value, usually called par.

If that happened what then would the common’s price be? $100- $200- $300 or as Stock analyze thinks $1,500?

Come again? Where on earth are these numbers coming from?

The two major signals from turning on the junior pref dividends would be that FHFA/Treasury are serious about getting FnF out of conservatorship and that the juniors wouldn't be exchanged for commons. The seniors could still be converted to commons and the warrants would still exist, so I don't see why the commons would run higher than maybe $6-7 on such news.