hardincap

i noticed the part of this interview where calabria says most of the litigation issues will "go away" has been edited out from the video. i wonder whats up with that? www.foxbusiness.com/markets/fannie-freddie-ipo-could-come-in-2020-fhfa-mark-calabria

also, how do you (and others here) interpret craig's departure now?

IMO, you are further wrong to think the pref thesis still holds. Because prefs have a capped return, timing has to be a part of the thesis, so if you are wrong on timing, the thesis is wrong. so to clarify your thesis then, how long do you think is "longer than I had hoped"?

luke, how do you explain the continued delays and reneging of previously committed timelines and positions (collins about-face)?

Jpm hosts these kind of sessions for its institutional clients all the time. No one in Jpm side in attendance would be privy to engagements w treasury, if any

Yep this means nothing, unfortunately. Moelis has hosted these types of info sessions before.

never meant to insinuate craig was fired. simplest explanation imo is that there was/is internal resistance within admin, as tim howard speculates, and craig either got fed up, protested, or saw nothing more he could do so he resigned

+1

sorry to be blunt, but that is borderline delusional. you might say, perhaps I am the delusional one? could be! but i say, always better to entertain disconfirming narratives (esp when coming from experts with insider knowledge like tim howard) than confirming. good luck everyone.

luke, the "ecstatic" comment doesnt connect with "shareholders who spoke with calabria". this article is very ambiguous and cannot be relied on. even if it were reliable, you still have to explain how we went from "signed off" plan in 2-4 weeks to draft 6 months later, with the key author abruptly resigning before draft is finalizled. basically, you're overreaching. confirmation bias is a b**** edit: this will be my last comment on this matter. my main point is there are much greater risks of plan being derailed than is being talked about here. just my 2c, take it or leave it.

the plan was not finished, it was drafted. the draft is now being reviewed by the white house. again, in the context of otting's statement that a plan will be out in 2-4 weeks, a draft many months later doesn't make sense. craig's resignation at the same time, before the plan is past "draft" status, is not a good sign. also, you're making another unwarranted assumption that the plan will be released in weeks. we dont know if it'll be released at all to the public, let alone in weeks.

how much are you willing to bank on an article that says "Most of the actions could be resolved by making preferred shareholders whole, potentially via a mass “sweep” of profits"? edit: it also says investors are ecstatic about calabria's statements, ie his speeches, media interviews, etc. obviously this is no new insight edit2: its amazing to me how strong confirmation bias is on this thread...

imo craig's abrupt resignation has to be interpreted in this context. occams razor explanation is that whatever happened to derail the original plan caused him to resign. what happens now, i dont think anyone has a clue...

yes im saying if we were to follow his advice in earnest, we wouldnt even be in this thread :P and frankly with the sp having hit 50% of par, i think there are more interesting opportunities elsewhere. the best opportunities are always in compounders that can be held for decades, as opposed to capped upside where you have to harvest (and pay tax on) the gains then find something new

his idea of greedy is getting convertible preferred with 10% dividend in companies with fortress balance sheets at depressed share prices. he wouldnt touch such a speculative investment as the gses with a 10 foot pole.

i think there is a non trivial chance that the treasury plan calls for congress to enact housing reform as a last step in the process of releasing the gses. mnuchin's statement on its face highlights that risk and as we see today it was a negative surprise, as markets were primed for quick recap and release. what mnuchion actually meant, we'll find out soon enough

He said housing reform is a necessary condition for releasing the companies. I dont recall him saying that before? only congress can do housing reform, so back to square one?

i just think antagonistic comments by influential politicians dont help when you're trying to raise 100bn from the market. the market reaction from this mildly negative headline was fairly sharp.. how bad will it be if/when politicians actively try to derail an admin-led release? im expecting a moelis type recap plan to be released next mo, and we'll see what kind of execution risk discount the market puts on f&f. i suspect at that point, the "easy money" will have been made...

Calabria specifically said he is obligated by the statute to release after recap. That is a BFD for him to say that. But, FUD like this does make it harder to raise capital, so its net negative, imo

+1 cherzeca. Fanniegaters gloat over how this is a cinch, market is stupidly underpricing, etc, forgetting that theyve been wrong about pretty much everything on fnma so far

big purchases near open, then big sale post news during last few minutes of trading. hmm

the problem with value investors is 99% of them think they have an edge and know better than others, when they are really deluding themselves (most often by copying other "value investor" ideas). the other 1% sit on their ass and do nothing but read. they become world class experts in their sectors. be honest, are you part of the 1%? (id argue that no one in this thread are true honest to god value investors). and if you're not, you need to be humble and incorporate some technical analysis - a fancy term that just means take heed of what the whales and smart $ is doing.

craig philips advocated for multi guarantor model end of last year. it could have been the plan all along, perhaps based more on political reality than business merit. re: th sources, he's stated before that he is in regular contact with key players, and i think the prudent assumption is that his opinions and reactions are informed by more (maybe significantly more) than what we see in headlines.

anyone else surprised at the underwhelming volume in prefs, given the magnitude of the news? market is quite pessimistic on prospects of shareholders not getting screwed (again). if this is a reliable indicator of sentiment, i dont know how admin will succeed in raising 150bn. admin is "working on it", per sources, but market is skeptical

gse capital rules expected this summer: https://www.americanbanker.com/news/gse-capital-rule-expected-this-summer-fhfas-otting Not sweeping this weekend seems premature to me?