orthopa

My assumption is that they raise as much low cost preferred as they can which I would expect to be at least the same amount as they currently have. They obviously have the ability to 'carry' that amount. If/when they do issue new preferred it will probably be mandatory convertible after a period of a couple years. This way you give the div that investors in this environment crave but also satisfy capital requirements as Calabria may deem convertible preferred as CET1. Either way the lb of flesh still gets pulled from the common shares.

I agree with rb. Furthermore, Investor20 posted a link to an empirical study, where antibodies appeared to fade away within about a few months. The head of the Swedish Health Authority, Mr. Tegnell, yesterday publicly expressed concerns & second thoughts about the Swedish pandemic strategy, btw. [Ref. the Swedish situation has been touched recently in this topic.] Personally, I'm very happy today, that my ticket in the ovarial lottery turned out to be Danish. - - - o 0 o - - - In short : Don't challenge your own fate by trying to mess around with this sucker. [Also, I think that this is what Greg all the time has been expressing in his posts.] Dont overlook cellular immunity which is the better way to look at immunity. Just looking at antibodies gives an incomplete picture and if not all the great majority of people should have long term immunity regardless of IgM, IgG antibody counts.

https://www.msn.com/en-us/health/medical/study-identifies-six-different-types-of-covid-19/ar-BB179KSE?li=BBnb7Kz&ocid=mailsignout

From your previous posts concerning this topic, i assume you mean the "shut down" in Australia hasn't worked or just delayed the progression of the disease at the population level. Is that it? For reference, here are some data points: 1- Average daily new Covid-19 deaths per million last 28 days last 7 days USA 2.1 2.6 Australia 0.0 0.1 2- The daily positive rate, given as a rolling 7-day average USA: 8.7% Australia: 0.5% i guess it depends through which lens you're looking at this. Recently, i came across a parallel being made between wildfire risk management and pandemics. There were allusions to primary, secondary and tertiary prevention strategies. Not so much a statement, just an observation.

Australia is back to pre shut down levels of infection.

https://www.boylecapital.com/filesimages/Equity%20July%202020%20No%20CRS.pdf Nice summary and thought process here.

Agree does not raise capital but FHFA put emphasis on CET1 capital in the capital rule and their presentation afterwards. Converting preferred to common is a zero cost transaction and instantly raises 33B. Also once the Sr preferred is gone it puts all shareholders; treasury via warrants, jr preferred once converted, and legacy common on a level playing field going forward. I cant think of any reasons why they would not convert them? Why deal with the headache of paying or not paying a div on expensive legacy jr preferred while trying to build capital? Then how do you sell additional preferred at expected lower interest rates then the jr preferred. Too many headaches.

If the Jr. Preferred are converted to common (as I expect) as discussed the trailing 30 day share price will likely be used for conversion. I would think Calabria would want both the common and Jr preferred on the big board for true price discovery for a fair bit more then a month. Thinking that there is a big bang just after election if Trump loses or in Dec/Jan time frame if Trump wins there is a good chance these get up listed in late summer early fall which is right around the corner. Prices will likely jump for both classes but will be interesting to see where the common settles. Exchange of 5-6 for 1 possible at a minimum to full par. If not exchanged at full par the Nomura piece out a couple of weeks ago speculated warrants may also be part of the deal for Jr Preferred with a $2.50 strike price and expectation of $5 common re IPO price. This would give the optics of Jr preferred not getting a windfall as a % of par and make it up on the back end with the IPO. Something I never thought about.

At that point since all parties would have to agree the GSEs largest or majority shareholders would have say since the GSEs would be out of conservatorship correct?

Let's say SCOTUS goes the GVR route on Collins and Biden is elected, but when he takes office the Fifth Circuit hasn't ruled yet. What would the ramifications be if Biden just tells Calabria "you're fired"? If Calabria just extends the middle finger and says "you can't do that", wouldn't recap and release be in trouble anyway because investors would have no idea what to expect from FHFA going forward? Presumably all this would happen before any re-IPO. Doesnt the consent agreement take care of all of this? If Treasury is out of the picture and conservator enters into a consent agreement with FnF how can a new FHFA head alter the agreement and not follow the law as Calabria has said? That sound like a situation for more lawsuits.

With Calabrias recent statement he must be getting legal advice from someone (milbank?) that he is not fireable based on this ruling. If he truely was why make a fool of yourself with a statement like that? Multiple times he has made a point that he will serve his 5 year term knowing this case was before the SCOTUS. At a minimum he can contest its applicabilty to FHFA in some fashion to drag things out right?

Do you have any graphs of daily deaths?

BUT interesting nugget here in the majority opinion on FHFA, suggesting that while the two agencies are essentially "companions," FHFA does not regulate private entities. At least not yet.

Shares trading couldnt seem to care less about the decision. Looking forward to the cherzeca interpreation.

I listened to this and enjoyed it. I think a point that I have missed and others maybe when listening to Calabria is that Fannie and Freddie will be raising the money. Based on what we have seen from the Fannie and Freddie CEOs in press releases they want to do this ASAP. Once the recap plans are approved by Calabria its up to FnF how fast the $$$ is raised. The CEOs, MS, and JPM then become aligned to get this done fast as the money coming in will let them. I think this is important as this will be a transition from being at the mercy of the gov via Treasury/FHFA and the associated delays back to private corporations timelines with shared incentives.

I think some of what we are seeing in the US is a result of what I bolded above. What is unique vs the other countries in that graph is the span of climates the US has. We know that indoor activities increase spread and maybe the largest factor. NY,NJ,CT are indoors more in Feb, March, April, TX, AZ, FL much less so. Now during summer TX, AZ, FL have tropical climates and are seeing outbreaks like Central America. Cuomo said most cases were coming from inside houses in NYC. Most cases likely coming from inside houses/enclosed spaces now. As we all know this is multifactorial but I think comparing graphs of NY, NJ, CT, to UK, Italy makes as much sense as comparing TX, AZ, FL to central america now. In the fall this will likely flip again. Anyone able to find graphs comparing the above states/regions? As much as we believe we can control and stop the virus we cannot control the factors above pushing populations indoors and outdoors.

Old news but was re watching some old housing hearings. Foster although a dickhead figured out what was going on a long time ago. https://www.c-span.org/video/?c4824072/user-clip-affordable-housing-hearing-10222019-foster-calabria-exchange Mnuchin when asked about conflict of interest noted there is no conflict of interest at treasury. That's because Paulson doesn't work at Treasury LOL!. Calabria seems taken aback and laughs at Foster looking forward to shareholders being wiped out at 4:37. Before that he did a good job acting with body language and a half hearted "we will wipe them out" LOL. We just have to wait for our day. Its coming.

Those whalen arguments indicate that none of this is at it seems. There's no way each one has not been carefully considered by Calabria and Mnuchin, especially Mnuchin, and plans are in place to address them. That said, I'm backing off my opinion of no more govt backing because it doesn't seem possible after reading his comments about it. So, regarding that govt backing, to every comment made by anyone against 4%, I think one very simple question by Congress must be affirmed: "Would these capital requirements assured no bailouts 12 years ago?". That's mandatory, no support without it. FnF have tanked since that pdf. I wonder if that's the issue, that this all can't be done without congress, and fear of Trump losing. Of course. Whalen is a douche and has been self serving an a big bank propagandist the whole time. He just cares about what pertains to him. You think Calabria will spend 2 minutes on his concerns after how he and Dave Stevens acted regarding the forbearance issues? There will be a fee paid for support to treasury which with the amount of capital they will have more then enough. There is nothing congress can do to stop recap now....and why would they? FnF need to come out of conservatorship.

ok thanks

Many seroprevalence studies have the same faults as the Santa Clara study. I've read a number of the studies he's included, and the bottom line is, seroprevalence studies are just not a great way of estimating IFR when the false positive rate of the serology tests is so high. NY just has some of the better statistics I've seen available--I just included as a proxy for general IFR estimating. I wouldn't hang my hat on those estimates, but even the population level death statistics show that it's higher than he's estimating. New tests are much more accurate. More serology large scale tests should be done. https://diagnostics.roche.com/us/en/news-listing/2020/roche-highly-accurate-antibody-test-for-covid-19-goes-live-at-more-than-20-initial-lab-sites-in-the-us.html It provides 99.8 percent specificity,

I find that surprising since the CDC recommends getting the flu vaccine by the end of October each year. Then the number of flu cases rise afterwards. Because we all know that summer time respiratory diseases go down and winter they go up. Thats why they give flu vaccine in October. Nevertheless. Cases rising X amount after locking people down does not show that it was ineffective. For example, let's say one person in my household was just exposed on the morning the lockdown began. That person doesn't test positive for 10 more days, and then 10 more days after that a couple more people in the household come down with it. That's 20 days of lockdown and an explosion in cases within my household. Did you just accidentally make a case against lockdowns? ;) Yup. Eric just described how to get an explosion of cases. The data from NYC itself is clear. More crowded, more cases. People living in small houses, more cases. People going out such as transit and police, less cases. I take it you are being facetious. Intra-household spread is going to occur regardless of policy. No, I am not being facetious. See below. https://www.cnbc.com/2020/05/06/ny-gov-cuomo-says-its-shocking-most-new-coronavirus-hospitalizations-are-people-staying-home.html Cuomo says it’s ‘shocking’ most new coronavirus hospitalizations are people who had been staying home https://www.forbes.com/sites/lisettevoytko/2020/05/18/cuomo-said-most-coronavirus-cases-are-from-people-staying-at-home-public-health-experts-have-a-few-ideas-why/#5389e322d20e I have put bold emphasis on what I deem suspicious and particularly interesting (was this a political statement by Cuomo?). Jha called for Cuomo to release the full survey results: “Without having a full splay of the data, it’s very hard to know what this analysis tells you.” Cuomo’s office did not respond to multiple requests for comment by Forbes. Social media users questioned the survey’s results, saying that because patients were coming from their homes, it meant that stay-at-home orders were flawed or an outright failure. Jha disagreed, saying other studies have shown that reducing people’s mobility flattens the curve, and that’s what has taken place in New York’s outbreak. “I don’t have a question in my mind whether ‘stay at home’ worked,” Jha said. Both Vasan and Jha said the type of lockdown seen in Wuhan, where COVID-19 was first detected, was much more stringent than what New York and other U.S. states have been under⁠—meaning the virus could be transmitting more easily here. Dr. Ashish Jha, Director of Harvard Global Health Institute, was first surprised by the survey’s results, but realized that “older and sicker people are less likely to go out and travel, and much more likely to get infected and to need hospital care.” Dr. Ashwin Vasan, Columbia University Medical Center professor and CEO of nonprofit Fountain House, wanted to know more about the patients: “Even though these people are older, do they live with essential workers? Did they live in multi-generational households?” According to Vasan, who also once served as an executive director for the NYC Department of Health, older people either living with essential workers or in multi-generational households are more common in low income and African American communities. What New York did not account for, Vasan said, was transmission inside apartment buildings⁠—”particularly in densely-populated communities, which seems to track with the [survey’s] results.” I had the same questions as these guys back in April.

60 days from publication in federal register Thats what I was trying to figure out too. My naive assumption it was already. At the top of the page I linked it says Home / Supervision & Regulation / Federal Register / Comment List https://www.fhfa.gov/SupervisionRegulation/RegulationFederalRegister/Pages/Open-for-Comment.aspx It also lists the Enterprise Regulatory Capital framework under the Rule Making/Federal Register link. Not arguing. Just hoping this all means it was placed on 5/20 and the 7/20 date is realistic.

So far there only appears to be a couple of legitimate comments to the capital rule. Chris Whalen has his comment up now. https://www.fhfa.gov/SupervisionRegulation/Rules/Pages/Comment-List.aspx?RuleID=674 FHFA said comment period was 60 days so that means comment period up by 7/20/2020?

thanks for ROE comp. do you think that because GSEs are so dominant with such large moats (albeit with political risk that likely will never go completely away but should be attenuated once release occurs) that a somewhat lesser ROE would be acceptable? it seems that a bump in g fees is a foregone conclusion given this cap rule. if Biden admin starts, I think it will have its own divisive arguments about what to do with the GSEs and how to react to what trump admin might have done at end of term (GSEs do that to people) but in principle everything that trump admin will have done (cap rule, g fee bump) can be reversed other than a release from conservatorship into consent decree phase. conservatorship requires facts re GSEs solvency that will no longer be true, and I assume the consent orders will have provisions that insulate them from easy revision/termination Raising G fees also go towards Calabrias goal to opening up competition in the Market. I get the fact that g fees going up raises costs on homeowners but even a 2bps raise at today's' mortgage rates only raises the payment $11 a month on a 30 year $100,000 mortgage. If the $11 is preventing you from buying a house then....

A cryptic message? For who and why? Found the price drop in the last week a bit more bothersome than I should have. Still fundamentals have been solidly improving in the last year. My base case is this drags on for another year or so before we find out our status, and I find it difficult to envision how the recap process can move forward without something reasonable being offered to Preferred holders. I have been adding more with the drop. I dont think we wait another year at all to find out status. Maybe for the first round of capital raises. Preferreds status will be known well before then. We finally have a hard/soft deadline in the election and capital levels in last PSPA agreement to push things along. As hypothesized by some I think we do get a "big bang" type announcement. PSPA amendment, announcement of recap plan, exercise of warrants, conversion of preferred to common based on prior 30 day trading range and likely reverse split. I think if Trump loses election consent decree comes right after. If the conversion ratio is right that maybe enough for preferred holders to settle. CET1 only counts common stock so I think any dividend payment talk past or future is meaningless to get out of conservatorship ASAP. With common trading at $2-3 a share preferred holders can extract their pound of flesh that way. Treasury will exercise warrants before conversion so preferred holders not diluted by Treasury. If conversion is going to be main method of value extraction for preferred holders then any announcement affecting price will have to be under wraps until all at once like Citi. As Tim alludes to this time period coming up maybe finally when the benefits of holding the preferred come to be seen. The sources of capital will surely include some of the biggest preferred holders and if the gov is serious about the recap ( hiring HL, MS, JPM serious enough?) then they need the big preferred holders blessing.