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Luke 532

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    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    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

     

    Interesting, good catch.  Do you remember what timestamp (or roughly 1/4 way through, 1/2 way, etc.) of the interview he previously said that about the litigation?

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    Seems like this isn't such a big deal. If you listen to his Fox Interview, it sounded like government doesn't want to "TOTALLY" privatize the GSEs, as in there will always be some sort of government backing of some kind. Which has always been the assumption here. I don't believe many people thought they would be fully privatized with ZERO government backing. The Trump memo even asked for ways for the government to be compensated for their support whether implicit or explicit. Non-story.

     

    He also mentioned plan still coming but timing unknown.

     

    SCOOP: @USTreasury unlikely to advocate privatization as a viable option in @FannieMae @FreddieMac reform-sources; Treasury complaining lack of personnel w GSE skills slowing reform, timetable uncertain-sources more 345pm @FoxBusiness @LizClaman $FNMA $FMCC

     

    Thanks.  Here's the clip: https://video.foxbusiness.com/v/6059461043001/#sp=show-clips

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    FNMAS has traded more shares today than FNMA.  Not sure I've seen that before, although I haven't compared historical volume.  I post this as nothing more than an interesting observation.

     

    By my data, today is the 41st time this has happened out of the 888 trading days since the start of 2016.

     

    Thanks for the info, so not rare as it happens ~5% of the time.  I admittedly don't watch volume and price action each day.

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    Interesting development...

     

    The only quote in the entire article. Presidential priority.  Updated 10 minutes ago.

     

    “The president earlier this year instructed the Department of Treasury to develop a comprehensive plan for bold reform,” White House spokesman Judd Deere said in an email statement. The National Economic Council, Treasury, Federal Housing Finance Agency and others “continue to work together on this presidential priority and anything to suggest otherwise is false,” Deere said.

     

    I also wouldn't completely discount the possibility that articles in the past two days discussing receivership and delay, delay, delay without one high-ranking source or even an anonymous quote were the work of those that have been so adamantly against the GSE's for many years.

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

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

     

    Definitely brings into question whether his work was completed or not.  He may have completed as much as he could, or perhaps he was fed up with the process. 

     

    I also wouldn't completely discount the possibility that articles in the past two days discussing receivership and delay, delay, delay without one high-ranking source or even an anonymous quote were the work of those that have been so adamantly against the GSE's for many years.

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    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"?

     

    You think the pref thesis is shot? 

     

    I hear what you're saying regarding timing, hardincap.  If this were trading much closer to par then timing would be a much bigger issue in terms of rate of return.  But trading at half or less than half of par the favorable outcome would dwarf the market even if it took a very long time. 

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    A few days ago when people were Taunting me and saying down 7% from the top is nothing to worry about, now it is down another 14% today. Be very careful of the crack of the canary of the coal mine situation. My biggest shortcoming as a value investor was not knowing when to sell. Almost the entire value investing literature is teaching how to buy and what to buy (not even when to buy). Regarding selling, there is almost no mention of that. Last year my primary focus was to figure that out.

     

    I want to be clear I was never taunting you.  Others maybe were, but I wasn't.

     

    Your points are appreciated but they still have to do with pricing of a security and don't take into account the thesis of the underlying company.  The stocks could be down 50% today, does that change the thesis?  No.  The stocks could be up 50% today, but again doesn't change the thesis.  As a value investor the buy price and sell price matter to me, what happens in the interim is irrelevant. 

     

    I think most value investors would tell you to sell when the stock is at or near intrinsic value.  It's probably not discussed more because it seems like that would be the only logical place for someone in the value investing philosophy to sell... we wouldn't hold it past intrinsic value, and we wouldn't be tempted to sell it at a steep discount from intrinsic value.

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    Were Otting's comments on the record?

     

    Did you not read about a month ago when it was said Phillips would leave but not until he was done?  It's not like his leaving was in the middle of the night... it was announced at least a few weeks before he departed.

     

    Sure, confirmation bias is a b****, but mere confirmation from those calling the shots is a beautiful thing.

     

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

     

    I explain the continued delays by saying I was wrong.  Wrong on the timing of this but I still haven't read anything that says the preferreds get hurt long-term.  May take longer than I had hoped, but I don't think the thesis has changed.

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    Disappointing for sure. But I don’t think it is BS. Remember Calabria’s tone changed from IPO in Q1 next year to Hopefully sometime next year? That’s good enough indication for me to completely unload even if I were still a pure FA investor. If I were still hoping on Collins, at least I’d sell half.

     

    Sure, but I am more disappointed on the report being delayed.  It's likely not the actual IPO taking place that moves the stock, it's the plan to do so officially being announced (along with other details involving the capital raise, how to deal with the lawsuits, etc.). 

     

    I'm not into trying to time things like you are, so there's no way I'd sell a single share given the price relative to par and what I believe is a very strong thesis for the preferred shares.

     

    And for what it's worth, I fully expect the share prices to fall based on people selling some or all of their position.  It's easier to sell a position when it's small.  I'd rather have the price temporarily fluctuate against me than sell a large position that would take a long time to reacquire and likely at higher prices given the illiquid nature of the preferreds.

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

     

    More delays.  Not entirely unexpected, but frustrating for sure...

     

    Perhaps most significantly, Treasury and FHFA could halt a policy that requires the companies to send nearly all their earnings to the Treasury. Though one person familiar with the matter cautioned that ending the so-called profit sweep is unlikely to happen this year.

     

    Signs that the administration is moving more slowly than anticipated are evident. The Treasury is yet to issue a long-awaited report on its plan for getting Fannie and Freddie out of the government’s grip, despite Calabria saying he hoped it would be released by the end of June. Now, agencies are aiming to get the document out within the next couple of months, according to people familiar with the matter.

     

    By the way, not sure if this matters, but Josh Rosner is calling B.S. on this article:

     

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

     

    she's a lazy journalist and I dont have a subs.  anything worthwhile?

     

    Not much in it. She gets quotes from Bright and Zandi if that gives you an idea of the gist of her article.

     

    Better link to entire article: https://www.twitlonger.com/show/n_1squmr4

    FNMA and FMCC preferreds. In search of the elusive 10 bagger.

    in General Discussion

    Posted

    I read a book that was recommended by one of you guys: "The Little Book of Behavioral Investing." It was a highly enjoyable read. I can't remember who recommended it, perhaps @muscleman. Thanks for recommending it!

     

    Happy birthday to the Nation that has sponsored the GSEs!

     

    It was probably me.  It is one of two books I recommend... it and The Intelligent Investor.  Glad you liked it!  James Montier is great.

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