Replies to post #351578 on Fannie Mae-No Politics (FNMA)

[big-yank]

The dude that wrote that article owns preferred shares, only.

And, surely, any stock can be made worthless via any number of mechanisms and events. But there is NO outcome where common shares finish in the money and preferred shareholders get nothing.

Any investment in any Fannie Mae stock carries a high level of risk. But pfd shares carry a much larger safety net than commons.

JMHO.

[ada]

There may be a scenario where common shares finish in the money and preferred shareholders get nothing. The government claims the bailout hasn't been paid back since the net worth sweep was instituted. What if they decide to remove the 3rd amendment and reinstitute the dividend sweep to "pay back the loan"?

[Dax1]

In this scenario, what happens to the debt? $4-5 trillion?