Replies to post #407226 on Fannie Mae-No Politics (FNMA)

[capitalismforever]

To me it means liquidation and new entities are created. Preferreds get paid, commons get wiped out.

[rekcusdo]

Hi lijianch,

"What is the meaning "not said privatization" but can not leave them as they are. This is a really confusing message to me. "

There are literally dozens of ways that you can restructure the GSEs without privatization. Some would wipe out shareholders where others would leave current shareholders intact.

I wouldn't say any outcome is more likely than any others (and I'd be weary of anyone who claims that they know how this will end) but the outcome I'm expecting (and invested for) is that the breach of contract claim will end in favor of shareholders given that such a claim is not barred by HERA. If we win such a claim, it is likely that the NWS would be retroactively refunded back to the GSEs. Then it will be up to the FHFA director how to proceed with conservatorship. I wouldn't expect any help from Trump or Mnuchin,...and I never have.