Replies to post #7858 on Fannie Mae Preferred S (FNMAS)

[ZDante]

Thank you for your response... it was very helpful!

[44centsAKAchoccake]

One key question is what happens to our preferred dividends once net investment is down to zero. Do they then restore our dividends? I think that is the fair outcome.

There are various arguments for why they would postpone paying our dividends, but I don't see them holding much weight. The bonds are AA+ or AAA, why would they want to maintain a C rating on the preferred stock?

There are a lot of issues about financial recapitalization. I think they can restore our dividend in the next year BEFORE financial recap. That's the best case. Under that scenario, we would be 100% of RV a year from now.

Given the obstacles, I'm only aiming for 40% of RV by Thanksgiving as my short-term goal.