Replies to post #790909 on Fannie Mae-No Politics (FNMA)

[JOoa0ky]

Profitable companies can still go through bankrupcy.

https://www.forbes.com/sites/melissahouston/2023/12/29/why-7-figure-businesses-still-go-bankrupt/
https://www.ceed.ca/the-paradox-of-profitable-bankruptcy-how-companies-can-go-bankrupt-while-showing-a-profit/

[Donotunderstand]

I hope you are right

Here the LP is different. Here the LP came into existence because the "paper" (Senior Preferred "shares") that reflects the value of the GOV investment (per GOV and documents and HERA) does not trade or budge one share or one penny. So the phrase LP was chosen for that number which is the SP plus or minus changes

IMO it is different

but hey - I hope I am wrong wrong and wrong

and I do hope that some POTUS uses executive authority to wipe out the entire LP as paid ---- and I believe that is inside Executive Authority

[kthomp19]

A liquidation preference is used in a bankruptcy and has to go in front of some sort of court and thru some sort of arbitration.

Wrong. Each series of the junior preferred shares have a stated liquidation preference and that liquidation preference was spelled out when the shares were issued, which was before conservatorship started. Liquidation preference and bankruptcy are entirely separate things.

Even then, one of the writers of HERA said that FnF's conservatorships are administrative bankruptcies and the FHFA director plays the role of the administrative judge.

How do you go in front of those groups claiming bankruptcy w/ 100+ billion in the bank, is currently the most profitable you’ve even been in your history and just paid 300+ billion back from monies borrowed.. its not even a possibility it would happen..

You are completely missing the point. The bankruptcy-equivalent event, i.e. conservatorship, already happened. Those of us who draw parallels between conservatorship and bankruptcy are not trying to warn or scare people about a future event. We are drawing an analogy to an event that happened 15+ years ago.

People who own or have bought FnF common shares after conservatorship started are just like people who bought post-bankruptcy shares of companies like JC Penney (JCPNQ) or Sears (SHLDQ). The stock symbols FNMA and FMCC are basically FNMQ and FREQ.

It's not the entry into bankruptcy that should be the concern because that already happened. It's the restructuring that is required for FnF to exit that should be the focus for FnF common shareholders.