Replies to post #680957 on Fannie Mae-No Politics (FNMA)

[kthomp19]

Quote: "The warrants are legal no matter what happens in Collins." Does that include if the SCOTUS is unable to determine exactly how the US Congress would have wanted the Judicial Branch to rewrite HERA and uses the Bulldozer approach?

All bets are off if all of HERA is struck down, and there is a good chance that the existing commons and juniors get wiped out if it is determined that they retroactively would have gone into receivership without Treasury's assistance.

Far too many people assume that FnF definitely would have survived without Treasury, and that myth won't hold up in court. FnF might have survived, but that's the most you can say and might not protect against a retroactive shareholder wipeout. Be very careful what you wish for.




(from another post)

Don't really agree with your logic on jps being the fulcrum security and the immediate need for a capital raise.

Fair enough. As I said in another post today, differences of opinion are what make a market.

The purpose of my Twitter thread on capital requirements is that even a capital raise 5 years from now wouldn't be much less dilutive than one done at the end of this year. FHFA (safety/soundness) and Treasury (taxpayer protection) both benefit from raising capital earlier rather than later; once Treasury gains the political cover from the Collins ruling to write off or convert the seniors there will be no reason at all for them to delay.

As far as the 3 cases you cited that decided that the government may impose the nws because it's NOT ultra vires and therefore the FHFA may do the nws because it benefits the FHFA was largely discredited by the 5th Circuits 16 judge panel.

I don't think "discredited" is the right word at all. If such a thing were to happen it would be the Supreme Court's ruling that does so, not that of the Fifth Circuit en banc panel. The Fifth/Sixth/Seventh/DC Circuits are all on the same level.

One thing we know for sure is that Conservators and receivers don't give away all of their wards profits to itself.

Itself?