Luke 532

Reads to me like he's keeping his options open instead of committing to a specific course of action.

Fiancee... has been married twice previously. Not a stand-up guy when it comes to family values, but he is spot-on when it comes to what is needed as Secretary of the Treasury and finance as a whole. Much like Trump in that regard.

At 12:35pm, Fannie and Freddie mentioned on topic of bad loans, but nothing mentioned yet on conservatorship, NWS, lawsuits, etc.

Inefficient government bickering... "valium" LOL

"The government can stop the NWS tomorrow without going to Congress. They do need to go to Congress to pass new legislation, but not to stop the NWS."

On timeframe of potential release of documents by new Admin: First speaker (paraphrased): "internal process within DOJ where AG makes recommendation to President, usually takes a lot of time but not necessarily in this case as it would simply be a decision to not invoke executive privilege. I don't see any reason why they couldn't be released within a month of Trump taking office." Second speaker said he agreed with those comments.

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It also fits perfectly with the truth.

When researching AIG years ago one of the comments I read from an anonymous hedge fund manager was that he/she saw great value in the AIG shares, but didn’t want to buy them because “I was afraid that if I lost money in AIG again that my clients wouldn’t understand and would leave.”

I don't think you're being naive. I think your assessment is correct.

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It says currently trade at the equivalent of $32. I think they mean that FNMAS is currently at 32% of par value, which it is. Perhaps... that would be quite the typo! I don't think it is a typo. I believe that $100 is a standard par value for prefs or bonds, but I may be wrong. When they state "equivalent of", they mean assuming it was a $100 par value. I agree they could have worded it better. Agreed.

It says currently trade at the equivalent of $32. I think they mean that FNMAS is currently at 32% of par value, which it is. Perhaps... that would be quite the typo!

Unconfirmed, but this (attached) is floating out there... GS saying FNMAS could trade at $32 with a payable 8.25% coupon. Again, unconfirmed.

Housing Groups Turn to Trump to Recapitalize GSEs http://www.nationalmortgagenews.com/news/compliance-regulation/housing-groups-turn-to-trump-to-recapitalize-gses-1093561-1.html

Aaaaaaand another... Carl Icahn. According to CNBC and WSJ, Trump to name Carl Icahn as special advisor on regulatory overhaul; Icahn also playing role in selecting next SEC chief These guys are going to get ripped apart by the liberal media when they do right for GSE stakeholders. Do we know if Carl Icahn still holds his stake in the GSEs? Trump and his team will be ripped apart by the liberal media no matter what they do. Those that voted for him certainly don't care, and there were enough that didn't care to get him elected. I doubt those voters care what the media will say about him for the next four years. Trump will do what he thinks is the best thing to do.

Aaaaaaand another... Carl Icahn. According to CNBC and WSJ, Trump to name Carl Icahn as special advisor on regulatory overhaul; Icahn also playing role in selecting next SEC chief

I agree as I spend my days trying to kill the thesis of each of my investments. But at some point I have to call a spade a spade and I think we've reached that point with this investment. With that said, one should always exert a certain level of caution in any situation.

It's not an exact science for sure. Investing is more art with some science mixed in, so take my percentage with a grain of salt. To put it in qualitative terms, I'm comfortable saying that there is a much greater chance that preferred shareholders make money long-term than the chance of them losing money. Perhaps I'm wrong, but every way I've sliced and diced the risk/reward on this investment it comes up heavily in favor of investors. I've always viewed Keynes as being a bit gun-shy and that shows in his letters. I probably would be, too, if I had been wiped out twice (which I think he was in the 1920's if I remember correctly).

Given the numerous recent developments, if anybody thinks there is more than a 10% chance that preferred shareholders (at roughly 30% of par value) lose money long-term, they're kidding themselves.

Mick Mulvaney picked for Budget Director. Trump is assembling pretty much the most GSE-friendly staff that I could possibly imagine, short of picking Berkowitz and Ackman. Articles on Mulvaney: Housing Wire... http://www.housingwire.com/articles/37023-conservative-groups-join-growing-push-to-recapitalize-fannie-mae-freddie-mac Carney at WSJ... http://blogs.wsj.com/moneybeat/2016/05/17/the-latest-fannie-and-freddie-reform-bill-offers-a-bonanza-for-hedge-funds/

Tim Rood, after meeting with Trump, had this to say today: "It's probably the least American thing I've ever seen. Having this situation where you have privately owned companies and the government comes in and nationalizes 80% of them but takes 100% of the profits. There's a huge opportunity there." http://video.cnbc.com/gallery/?video=3000574296&play=1 Given the recent appointments, quotes from various people, etc. it is pretty easy to figure out where Trump's head is at on this issue. I must admit I'm a bit surprised the position sizes mentioned on this board aren't higher. With that said, I'm not publicly sharing how I've sized it.

+1 that would be "pretty fast" I agree, and I'm sure Obama likely sees the writing on the wall. If he knows a settlement is likely, why in the world would he let Trump get credit for it and risk the documents being released? Obama could make keeping the documents secret a term of the settlement, whereas Trump doesn't have nearly as much incentive to keep the docs secret and might simply settle because it is what is best for his administration, shareholders, and the American people (and might still let the docs get released). I still don't see any logical reason why Obama wouldn't settle. Of course, he hasn't acted logically for a very long time now so I'm not surprised.

OK, I must be wrong on that point. Sorry guys.

Agreed. Berkowitz would likely take par plus unpaid dividends since 2012. Obama is in a tight spot if he wants to keep those documents from public view. 7 weeks... ticktock. Just curious as to why you think unpaid dividends are on the table? These aren't cumulative preferred shares and there's no impetus to pay a common dividend anytime soon so I am having trouble seeing that as being a reasonable ask in settlement talks. They are non-cumulative, yes. But for the NWS, dividends on the junior prefs would have been paid. Logically speaking, I don't see why Obama wouldn't at least settle the Berkowitz and Perry lawsuits. The positives of him settling vs. the negatives of passing this to Trump are mind-boggling. I think the odds are grossly understated of Obama settling this in the next 7 weeks. Probably won't happen, but for the sake of Obama and his legacy it should.