Replies to post #822676 on Fannie Mae-No Politics (FNMA)

[kthomp19]

Are you saying that every buyer of common stock is unreasonable?

I'm saying that there is no reasonable expectation for any buyer of FnF stock after the NWS, even now with the jury verdict and subsequent LP ratchet letter agreements, to have any economic rights given the current status of the contract and amendments.

The January 2021 letter agreement, which established the LP ratchet up to the full capital requirements plus buffers,

I would disagree. If someone buys a common share today, clearly after the NWS, they are expecting economic rights.

There's only one thing that could truly settle this disagreement, which is actually filing a lawsuit. Sound familiar?

(Though you should note that your prior accusation that I shut down debate by pointing to my first signature line has been proven incorrect; I have been debating you on the merits of your putative case for quite some time.)

This is reasonable in light of the Conservatorship being temporary, the NWS having been deemed a breach of the implied covenant of good faith and fair dealing, and the Charter Act which creates these as privately owned entities, not government owned. Are you saying that every buyer of common stock is unreasonable?

No, I'm saying that anyone who bought FnF shares (common or junior pref) after the NWS has no reasonable expectation of future economic value. You have already said that you disagree with this, but again this disagreement can only truly be resolved by a court.

In addition to the single day drop in share price, there is a ripple effect that was ongoing, via suppressed share price, lack of dividends, etc. Nothing that could be calculated as damages, because we can't say what would have happened if not for the NWS, but there is implied damage beyond the initial price drop.

Lamberth clearly disagreed with that last part because he didn't allow any damage models other than the price drop one to be used.

But at no point did the court say that the GSE shareholders relinquished their rights, or that the GSEs could not be released and/or recover economic value for shareholders. We get the jury award and KEEP the common and preferred shares and economic rights contained therein.

What economic rights? The NWS removed all of common and juniot pref holders' liquidation and dividend preference, and the letter agreements kept that status quo in place. What remains?