DRValue

Agree. Debt needs to fall an awful lot more till I'm interested.

I'm only really interested if they file. Right now my opinion on what will play out is that the company is using this as leverage to lower the claims against them. For me the financials in the end matter most as I'm going to assume, regardless of rhetoric, that this business will continue in one form or another.

https://www.cnbc.com/video/2019/01/14/heres-a-break-down-of-the-pge-plan-to-file-for-bankruptcy.html Feels like a liability management exercise to put a cap on claims. Stock is pretty high considering they file on 29th. I'd be surprised if there doesn't end up being some value here.

We're on the home straight bud. Good much though.

https://www.zerohedge.com/news/2019-01-12/pge-reportedly-planning-bankruptcy-announcement-workers-monday Somewhat reminiscent of ggp liquidity event causing bankruptcy. Potential solution to 30b liabilities is 18b unsecured conversion to equity, issuance of 18b new debt, equity raise and rate increase? Perhaps a pay out over time a'la trans ocean is manageable? Will be interested to see if any big names end up in unsecured debt. If only I wasn't waiting for the gse's...

Not to get ahead of the en banc hearing, but what is the expected timing on the opinion?

@puppy Valuable work thanks for sharing.

I'm buying more today. Probably 50/50 common and preferred. Recap mechanics and how much, if any, competition are the only uncertainty now.

Otting will be acting director for at most 6 months? Assuming calabria is confirmed.

C'mon Jo!

Is there a case for damages if the sweep is ended but the principal is not deemed paid?

Wow, so you think that potentially the lawsuits could continue even if the companies are released? Or could Treasury say you get par if you drop the suits?

Agree. 1 in 200 bankruptcies is probably a profitable investment, no data for that but you get the point... The thinking on this one is that they're a utility so there's still demand there should they be able to work out the liabilities. A bankruptcy to convert some unsecured, an equity raise (assuming they can), raising rates and some more debt are some options. If debt is converted in bankruptcy id expect to get par eventually.

Not much info yet hence starting up in General Discussion, to hear peoples thoughts. https://seekingalpha.com/news/3421010-pg-and-e-opens-minus-24-percent-bankruptcy-fears If they file, the debt in bankruptcy could be interesting. They've also filed before and I'm trying to find out exactly what the outcome was. Any thoughts? What generally happens to stockholders of utilities that file? I'd imagine bigger utilities continue in one form or another.

@Cherzeca Chris, do you have any insight about what sort of settlement or negotiations are ongoing between plaintiffs and Treasury/FHFA? Assuming the Treasury genuinely does want to end the conservatorship, both sides have massive leverage. The Treasury can threaten to not end the conservatorship and to wind up the companies (although that would cause more problems IMO), and the plaintiffs can argue that if they want to end the conservatorship and lawsuits they have to give us one hell of a deal. I'll be really interested to see how all this plays out and hope that I'll be able to be a party in any class settlement.

Could be an interesting day tomorrow, but not holding my breath. Here's to more useless comments in 2019!

Fannie Maes 10q says dividend to be paid no later than 12/31. Treasury says no later than 12/28. Could be clearing, could be government shutdown, but the treasury dividend record doesn't say it's paid yet... Have dividends fallen on a weekend before? Do they normally not update immediately?

I doubt they'll be anything new here, but does anyone have the full text? https://www.americanbanker.com/news/will-2019-bring-long-awaited-reform-of-fannie-mae-freddie-mac

I bought 136 fnmfn. Glad you noticed. ;D

https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/2019-Scorecard-12192018.pdf 2019 scorecard has the gses design access for competitors into the csp. Surely increasing your competitors goes against fiduciary duty. Probably why it's a separate llc. I expect it to be spun off and run independently.

I don't remember FHFA ever admitting that they would have forced the companies into conservatorship even if the boards didn't consent to it. Which of the grounds for placement into conservatorship in HERA would FHFA have invoked if not for the consent of the boards? All of the accounting shenanigans leading to them being undercapitalized didn't happen until after FHFA appointed itself conservator. I scanned that document today and see the defendants admit a lot of things. Not sure if this is out of the norm though, and I didn't have the plaintiff document to compare to.

Moelis uses a $14.57 "IPO" price for the GSEs in 2019. According to Moelis projections that's a 10% annual return. I don't know about you but I'm not sure I'd buy in at that rate. Admittedly though, the P/E ratio is relatively low at 11x, so returns could be higher. Any data on IPO returns for investors historically?

"We expect to pay Treasury a fourth quarter 2018 dividend of $4.0 billion by December 31, 2018. " Thoughts on whether the dividend gets paid this quarter? Given Watt is in, I would assume so. Calabria/Otting to stop the NWS in Q1?

https://www.barrons.com/articles/podcast-a-13-billion-miss-on-big-tobacco-stocks-51544695274 "In fact, a recent study from CoreLogic found that jumbo mortgages now have lower interest rates than conventional mortgages even after adjusting for the superior characteristics—higher credit scores, higher incomes, and lower loan-to-value ratios—of jumbo borrowers. The reason seems to be an increase in guarantee fees charged by Fannie and Freddie, which offloads risk from taxpayers to borrowers." G-fees too high? Is this going to be a tool to reduce market share after all? or ae they 'artificially' high as there's no capital in the companies?

Any legal opinion form someone qualified is better than my ramblings. In any case, we're still right, its just that the deck is stacked against us. I think our investment thesis will be vindicated, but we won't get the legal ruling we should. I just hope we don't set precedent with it.