undervalued

I am holding and pretty much agreed with Michael here https://twitter.com/urbankaoboy/status/1351185902207426563?s=21 Like COBFInifinity said, if going to 0 is unlikely all we need to do is wait. Which series do you like COBF?

With all the negativity around Mnuchin not delivering what we expected, I still think there is something positive that happened that maybe we overlooked. Is Mnuchin not doing anything be a better alternative? Hopefully, MC will give clarification next week in his interview.

https://www.bloomberg.com/news/articles/2021-01-13/trump-team-s-final-act-on-fannie-freddie-leaves-fates-to-biden

https://www.bloomberg.com/news/articles/2021-01-11/biden-s-team-explores-ways-to-replace-fannie-freddie-regulator

Is there a way to easily confirm this? I am still holding and thinking about what if scenarios on what Yellen will do and what her plan is once she is in office IF SM doesn’t do what we think he’ll do. We have been disappointed many times so if SM does something it’ll be an exception to the norm. Just be careful what you post here, it’s a stressful time for those holdings.

I love it lol

Since you're talking about long term, what can Yellen do when she is in power to stop whatever Calabria is planning now?

Nothing is stopping this train https://outline.com/2FL4Kg

There is an WSJ opinion 2 days ago - https://www.wsj.com/articles/the-continuing-saga-of-fannie-and-freddie-11608480578

A lot of timelines have been thrown around - the last date for conclusion discussed here was 12/9. I don’t know how you can get 100% confidence that something will happen between now and mid January. My own assessment of the probability would be less than 50% for sure. I also think that all those leaks ( sitting on his desk waiting to be signed ) are probably worthless. At this point anyone has its arguments belive on one side or another (no one is right or wrong until 20th of january). Taking account GSEs reform history one should think this wont be done, but I think this will get done given all past months nuggets. I had to double check whether I did 100% or 0% that Mnuchin will act ;D. Interesting that it is interpreted as the same meaning.

Nailed it! I agree as well (probably a first in this board). It is quite possible they you can buy the preferred with a good risk reward after a deal is announced. That’s sort of why I am watching this somewhat. Right now, it’s just a crapshoot and time is running out. If nothing happens in the next 3 weeks, then it will likely take another 4 years to waiting. And why would it happen in the last 3 weeks when they couldn’t get anything done in the last 4 years? I was looking back at the ACG timeline last night and wonder how it will get affected by Biden win. I think the timeline is expecting Mnuchin to ends the PSPA between now until mid Jan. I almost consider Mnuchin not doing anything between this time at 0% because it's such a low hanging fruit to basically make history for himself.

If you have looked at the past 5 year chart for FNMAS, you'll see that every time it spikes up, investors were thinking it's just around the corner and every time they're proven wrong. So people who are staying and keeping the shares are probably the insane one expecting a different results. Similar to what happen few years ago with TSLA when news broke out that TSLA might go bankrupt, you'll need similar faith to Elon that he is going to take care of things. You need similar faith here in Mnuchin where he'll do the right move. This thread is public so whichever bot is monitoring this conversation has already taken account information posted here. Of course when the facts change, you need to change your mind. So far no news channels have quoted Mnuchin/Calabira are going to do other than what they have stated.

You'll need faith in Mnuchin for you to be in this trade. Similar to the TSLA trade lol

Random questions, do journalist have privileges to trades on these information? I imagine journalists could make a handsome profit doing these articles.

And the answer is that nothing will be done before they leave. They have to think about their future as they leave the office. They could be offered highly paid jobs like the other "revolving door" politicians who implemented the NWS. Of course if that's not enough incentive, what just happened to Brian Kemp's daughter's bf could be enough incentive. I think that's exactly what we're betting on - that they will do something before they leave.

Ok here is my biased opinion.. Nothing has changed on what Mnuchin/Calabria might do before he left (Like Luke/Midas mentioned). Might be a good time to add more if you aren't fully allocated.

https://www.scotusblog.com/2020/12/argument-analysis-very-hard-questions-in-dispute-over-fannie-mae-freddie-mac-shareholder-suit/ Not sure if this is helpful but interesting read.

Interesting to see that we flip flop between court vs Treasury/FHFA depending which one is more favorable to keep betting on this thing. This article seems to point out what is at stake if plaintiff wins https://www.vox.com/2020/12/9/22165338/supreme-court-collins-mnuchin-samuel-alito-housing-fhfa-unitary-executive

https://www.wsj.com/articles/the-fannie-and-freddie-conundrum-11607470249 Any idea why they said the above sentence about it not being repaid? Ah never mind.

Plus Mnuchin's planted question with Timmons-SC designed to clarify the trigger point for release during the capital build. IMO, Mnuchin is unlikely to make this type of effort if he wasn't serious about a PSPA amendment/consent decree. Overall, I looked for any sign of a change in direction away from the objectives written out in the UST Housing Reform plan. I didn't see any, and new signals (from Powell/Crapo/Warner) left me feeling even more positive. Mnuchin appears to be a man of his word who works in an administration that prides itself on keeping promises. Like it or not that's a wager we are all making. agree how can you have a plan for releasing on a consent decree if you don't do a final agreement? IMO he just showed his cards/purposely telegraphed etc. I am just trying to poke holes to the thesis. At this point, the ball is on Mnuchin's court right? He has complete control over which direction GSE goes whether we get any court win or not. If he left without doing anything about GSEs, is that similar to sticking up middle finger to everyone who's betting on this?

Also, Warner and Crapo took Mnuchin out to dinner Wednesday night, after the hearing in which Warner said nothing negative about GSE's and Crapo was positive. Forgot to give link: On Wednesday night, Senators @MarkWarner & @MikeCrapo took Secretary Mnuchin to dinner, two sources tell me. Among other topics, they discussed the bipartisan COVID relief framework. Warner is one of the Dems most involved - so here's another way lawmakers are working the WH. As luck would have it, I may have been dining at the same restaurant that night. Upon seeing the trio, I sent over an appetizer of beautifully plated goose-eggs benedict to Warner and offered to pick up the tab for them if anything positive for junior preferreds was finalized at the dinner. Crapo said if I was a taxpayer I would be picking up the tab either way. When I said "that doesn't sound like protecting the taxpayer to me" Mnuchin just shrugged. Almost got a seat at the table?

https://www.c-span.org/video/?478323-1/treasury-secretary-mnuchin-federal-reserve-chair-powell-testify-covid-19-response FYI, 01:16:03 mark is when Mnuchin start addressing FNMA conservatorship.

This kind of journalism is so pathetic imho...if they wanted to do it for hedge funds wouldn't it be years ago. Instead of looking at the merit of the proposal, they come out with all sorts of garbage. Security prices go up all the time with event based investments; it seems this is just an excuse for journalists pushing an agenda. Edit: also to invert the argument, if/when a PSPA and consent order is done, one could argue any rollback to that path can seriously set back the mortgage market as well, and with more lawsuits to boot. The article also mentioned if Biden is able to remove Calabria at will then he'll also be able to undo most of the changes that Mnuchin/Calabria is about to do. The question is how much can Biden undo?

https://www.marketwatch.com/story/the-trump-administration-may-privatize-fannie-mae-and-freddie-mac-and-it-could-disrupt-the-nations-housing-finance-system-11606208076?siteid=yhoof2

What is their incentive trying to push FNMA/FMCC and IntelSat very hard?