Replies to post #21183 on Washington Mutual Preferred fka WAMPQ

[speculator777]

The low ball POR said 10%-20% that is still a 2-6 bagger from here. Minimum.

[Chiron]

You have to understand that the POR is not a reorg in the sense that the current equity will get a part of it. The goal is to cancel equity, if there is money left over it goes to pay off the preferreds at xx% and then they are canceled.

I think the fact that Willingham owns only commons bodes well for thier eventual outcome. It means the EC won't accept a deal that gives commons nothing.

However, Rosen could still try and pit the preferred holders (hedge funds, etc) against the commons by creating a revised POR where the NOL refunds go to pay them off close to full face value - and then they are canceled.

That being said, I took the fact that Mike owns only commons as a positive, and purchased 100K of them the other day. So I personally am back in commons, however in the short term you could still see a POR come out that gives something to preffereds thus increasing their trading value substantially.

Who knows? No one saw the viciousness of 3/12 coming. No one knows what is coming next.

However, the facts are that the preferred get paid in full before commons see anything. And right now if you are betting commons will get less than $4 - preferreds are the better buy.

[Lawrence 147]

Also one must remember that ever so pesky Equal treatment clause. If there were banks in just as bad or worse shape as WM then the FDIC abused its power and chose who would go down and not that all would go down equally under the law.

regarding Joyce's comments that the FDIC can seize a bank for whatever reason in an economic crisis.....