Replies to post #715000 on Fannie Mae-No Politics (FNMA)

[Donotunderstand]

a utility model is not a new idea - and in 99% of cases - it aims at 8% and such is required to attract capital

[JOoa0ky]

They don't care for giving existing stakeholders anything but they DO understand that they have to give new incoming private capital a return if they want private capital to take the first loss position.

Are you kidding? You think the government will give investors 8% ?
That might be what they cut themselves based on a backstop arrangement. Investors will be lucky to get 3%, and that'll be taxed! None of those Dems speaking (Waters or Brown) will be willing to give up any profit to an investor when they can give away freebies to making affordable racially centered housing.

They do not understand the very basic but all important aspect of giving someone a fish opposed to teaching someone to fish.

[FOFreddie]

We cant expect the UST or FHFA to propose anything that does not claim that the SPSA liquidation value is legit to start. The Jan 2020 Amendment stands and the CBO has already come out with this methodology.

Ultimately I think Tim Howard is right and the common cram down does not happen. I know that many believe that the warrants are not valid but it is my opinion that is our best case in that we will be 20/80 with the UST.

All the shenanigans should scare the shit out of Congress and they should not let the woke crowd use the GSE heist as a playbook for future Nationalizations. The CBO paper mentions the Farm Credit system as having a similar structure and it is not unforseeable that the rise in interest rates and oil prices could cause a financial meltdown for the farm credit system.

The remaining cases should be on our side and promote a good settlement if they want to get the Calhoun plan done in a way that cant be unwound but we have good reason to be wary of SCOTUS and the Court system in particular.

The public Common is worth $ 20 to $ 60 bn - will the UST take it?

Most of all the way UST can maximize its investment is to treat the public common right and raise equity as soon as possible to minimize duration risk. The potential for UST stake losses due to duration risk in its equity portion of the future GSE capital structure is much more than what they potentially can rip off investors for.