Replies to post #563327 on Fannie Mae-No Politics (FNMA)

[ano]

Cancelling the entire contract would be a disaster for FnF by the way, because it would nuke the funding commitment that is the basis for Treasury allowing release.

It would be just the way it was, there is no need for a funding commitment, there never has been any commitment EVER, now they want to curtail FnF thru the SPSP, but that is not allowed as their statue currently is “conserve and preserve” not “we can do whatever we want” like they have done in the past.

Wrong. The SPSPAs don't mention a junior-to-common conversion or an equity raise at all, but both of those have been given as possibilities by Calabria, and both cause the share count to rise.

Come on, you don’t really think that is possible right, how would FHFA/Treasury justify that?, FHFA/Treasury and Common got into the same boat in sept-2008, with 20.1%/79.9%, how could that change, MC needs to follow the Statue, he’s not giving away stuff that does not belong to him

One way to unwind the NWS, and by my reading the only possible one by the terms of the SPSPAs, is to act as if FnF had paid the 10% dividend every quarter starting in 2012 but just kept anything above that. In that world, FnF would have $131B more in cash than they do now, and the seniors would be fully intact. The way to make our reality match that hypothetical world is for Treasury to simply write FnF a check for $131B.

Note: that does not mean an instant recap because core capital is -$181B right now; adding the $131B wouldn't even bring it to positive territory. A recap in this scenario requires the seniors either being cancelled (which I believe is illegal for Treasury to do with no return consideration), converted to non-cumulative prefs, or converted to commons.

See post 563985

I'm not the one claiming that any part of the SPSPAs is illegal other than the NWS. I'm not the one complaining about it. I also don't have anything to file a lawsuit over that hasn't already been filed.

Well that makes 2 of us, YOU (fairholme) is indirect claiming the Conservatorship is illegal (it is a taking) you indirect complain you want a conversion to common, and the current lawsuits contain all commons and pref demands
Bhatti Rafter and Washington federal for the commons

17-20364 Collins v. Mnuchin
18-281C OWL CREEK ASIA I, L.P. V. THE UNITED STATES OF AMERICA,
18-370C APPALOOSA INVESTMENT LIMITED PARTNERSHIP I
18-369C AKANTHOS OPPORTUNITY MASTER FUND, L.P.
18-371C CSS, LLC,
18-529C MASON CAPITAL L.P.
1:13-cv-0608 Fisher v. Federal National Mortgage Association
1:14-cv-00152 Reid v. Federal HomeLoan Mortgage Association
14-740C LOUISE RAFTER, PERSHING SQUARE CAPITAL MANAGEMENT, L.P
17-cv-02185 Bhatti vs. FHFA
1:13-cv-01053-RCL FAIRHOLME FUNDS, INC
13-1439 (RCL) ARROWOOD INDEMNITY COMPANY
13-698 Arrowood Indemnity v. United States
13-1288 (RCL) Miscellaneous (Marnue Holdings)
13-CV-1421-RCL Miscellaneous (Marnue Holdings)
2:18-cv-03478-NIQA Wazee Street Opportunities Fund IV LP v. United States
13-385C Washington Federal
1:17-cv-497 MICHAEL ROP
1:17-cv-00005-M-LDA JUDITH A. SISTI
13-466 Cacciapalle, et al. v. United States