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MrSwankyPants

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

    in General Discussion

    Posted

    8 hours ago, Wiggins said:

    Is anyone here (besides Midas) following the controversy over Borden vs United states:

    https://howardonmortgagefinance.com/2021/05/24/fhfas-crt-report/#comment-23502

    ?

     

    I've read Kagan's plurality opinion and Kavanaugh's dissent.

     

    I agree with Kavanaugh and after reading the plurality's opinion it worries me a bit more about an adverse outcome. I do still cling to the idea that precedent is not needed for a win in Collins though given the plain language of the text. But, curious if others have thought about this.

    A good analysis is given on the latest episode of the Advisory Opinions Podcast with David French and helped me to understand what was going on here. The issue at hand is Thomas being the lone wolf, creating a plurality agreement on the outcome, but for different reasons. I'd encourage you to listen to it. 

     

    The TLDR of what's said is basically this- Thomas decided to be take the practical route in this case based on his previous dissent in another case (Johnson) and his view that a 4/4/1 decision would create significant confusion for lower courts going forward.

     

    What's important for Collins is that the two textualist Gorsuch and Thomas stuck together.... I firmly believe Gorsuch joined Kagan most likely because of the TEXT of the statute. Add in the language of Kanavaugh's dissent (pulled straight from judge brown) and I feel good about our chances simply because Roberts, Alito, and Barrett have seemingly put their stamp of approval on that reasoning at some point during the drafting of the dissent. 

     

     

     

     

     

     

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

    in General Discussion

    Posted

    Some thoughts from today's SCTOUS opinions. Looks like December opinions were issued by Kavanaugh and Kagan this morning (Edwards and CIC). 

    That leaves Barrett, Gorsuch, Thomas, Breyer, and Alito without any opinions from December's conferences. I very much believe Alito is very busy working on Fulton from November, and therefore I don't see him working on a major case like Collins as well (two huge cases back to back). The reason i believe this is that Fulton is a major religious liberties case, which Roberts tends to assign Alito to. 
     
    So I'm guessing either Barrett, Gorsuch, Thomas, or Breyer will be the author of our case. Breyer hasn't written since October, so his schedule is open... 
     
    Of course, there's no rule that a justice can't write two opinions each month, but looking at the trend for the term, it looks like Roberts has been handing things out fairly evenly (outside of October where Barrett didn't get any assignments). 

    Would love to see Gorsuch or Thomas write Collins.... 

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

    in General Discussion

    Posted

    @locutus

     

    I'm with you on that. I've been posting here since 2018 and have been focused on the court cases the whole time.

     

    At this point, given that the NWS is no longer flowing into Treasury, it's important to ask how our wonderful politicians can unlock further value out of these companies for themselves. The NWS was a pretty unusual mechanism of government grift. We should look to the conventional, usual mechanism which is lobbying, and thus how politicians will serve those interests.

     

    A helpful resource is to look at where the lobbying dollars are coming from in various industries: the securities and investment industry (https://www.opensecrets.org/federal-lobbying/industries/summary?cycle=2018&id=F07), commercial banks (https://www.opensecrets.org/federal-lobbying/industries/summary?cycle=2020&id=F03), mortgage bankers (https://www.opensecrets.org/federal-lobbying/industries/summary?id=F4600), and savings and loans (https://www.opensecrets.org/federal-lobbying/industries/summary?id=F04).

     

    Most of the lobbying groups that wanted the GSEs shuttered have moved to a more neutral position, now mainly asking for an explicit guarantee. SIFMA, the largest contributor in the securities and investment department published a white paper advocating for an explicit guarantees, found here (https://www.sifma.org/wp-content/uploads/2020/12/SIFMA-letter-to-Treasury-on-GSEs-2020-11-30-1.pdf). This group also includes parties such as Capital Group that have very much to gain since they are large shareholders of JPS and commons. Capital group gives 1.8 million a year alone. Of course the financial underwriters, also large lobbyists, have a lot to gain. And others such as CMLA are on these lists. Thus, many players now have a lot to gain and a lot to give, a good combo.

     

    I think Michael Kao is correct with the idea of an "Indiana Jones switch". Treasury will want to get the GSEs out of conservatorship in a way that absolutely maximizes value for incoming shareholders (ie the lobbyists), so they will want to keep share prices down as much as possible until announcements are made. The only thing Treasury cannot firmly control is the SCOTUS decision and subsequent market reaction. But other than that, I think we will see a grand settlement announcement at the exact same time we see an announcement of massive new money commitment and terms that are made before the market has time to react.

     

    Part of the above views are the believe that JPS are the fulcrum security and thus will do well, hence the massive buying opportunity that is present now.

     

    Can you please define 'Fulcrum Security' - I rarely hear that phrase and am curious to understand what it means in specific terms.

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

    in General Discussion

    Posted

    The SC issued an opinion today regarding judicial review (https://www.scotusblog.com/2021/02/divided-court-favors-judicial-review-of-agency-decision-on-railroad-worker-benefits/).

     

    Curious to hear ROLG's thoughts on any tea leaves that could be read through this to Collins. If i'm correct, JR was a tactic used by the government in it's defense.

     

    I just read the link, not the opinion, and this is an interesting case...not the least because most of those favoring judicial review in this majority are justices that I would expect to side with govt in collins re anti-injunction clause.  these cases for statutory interpretation often are decided based upon the precise language of the statute, which is usually different from case to case and statute to statute. but yes you can take this case as indicating a judicial slant in favor of judicial review...and indeed the justices who were in dissent argued that there was another statute that limited review, not that the statute in question didnt support it.  so directly readable to collins? no.  but better than a poke in the eye with a sharp stick

     

    collins is interesting since while the justices might recoil at the notion that govt can siphon off >$100B and not have its action subject to judicial review, while at the same time considering granting a remedy in that amount constitutes a tough swallow.

     

    I also found it interesting that the judges who were in favor of JR were on the 'left' side of the bench. Agree that it's quite different than our case, but happy to see more JR in general.

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