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Mnemonic

09/23/22 12:19 PM

#732940 RE: trunkmonk #732904

High PE ratios are for high growth companies. You're essentially betting future earnings will eventually bring that number down.

GSE's earnings are relatively stable; they will never command a high PE.

I'd be very skeptical of any valuation that A) imagines Treasury will write down the seniors for no consideration, and B) assumes the GSE's will never raise capital.