This2ShallPass

Process, I just like it way too much. I was just telling my wife yesterday that I'm growing addicted to this thing. Of course, proceeds are the yardstick to measure and that's the fun part, making more than enough mistakes (markets will humble everybody) and adapting / learning along the way.

Why do you say that? Isn't there a deadline ~Sep'25 for an IPO (some deal w omers)?

This is a plausible scenario, you never know what new crisis he's going to rake up with all the million things he's trying to do at once. But something worth taking a chance on. So I'm not hearing any realistic ways where the junior preferreds doesn't get paid par. Any scenario where common gets paid a dollar without junior pfds at par will be challenged and lose in court (this part I'm pretty sure). Senior pfds, govt is a non economic player, so you don't know what they'll decide. I don't think anybody is objected to releasing from conservatorship, basically just need time to go through the mechanics. It needs push to not fall into the back burner which I assume will come from Ackman, Paulson et al.

Given that there's widespread agreement that the GSEs need to be released from conservatorship, what are some (reasonable) scenarios where the preferred don't get par value? It seems to me like an almost gtd 2x from these levels.

Exact feelings I have:)

@SafetyinNumbers any particular reason for ELF dropping 15% in the last few months? My cash position is building up and this would be on my shortlist.

Which of the pfds will have higher value? I thought all of them will trade close with only small differences.

CoBF does not (really) like Pabrai, Ackman, Malone etc Do you know how much was the underperformance in 20 years? I know he underperformed the last 5 or 6 years.

The eventual release language should be really positive for the junior preferred correct? Surprised they didn't move lot higher on the news but common did. Is there a scenario where junior pfd gets paid less than par and common still has value?

I don't think this is the reason, he's trailing s&p by a wide margin this year and few basis points is not going to help. Also, he has beaten s&p in last 5 years by a good margin which should be enough. The tweet was likely aimed at Trump, telling him he could make the biggest deal. That would definitely get his attention..

I don't think he reported common. But in one of the presentations, he had shown % ownership of Fannie and freddie and from there I calculated how many shares he might have. That's just an estimate by me.

That might be it, because I didn't see him owning preferreds in their latest release. I tried to calculate his ownership, looks like he has 43M of Fannie common and 50M shares of Freddie.

I said young(er) I'm with @Blugolds, 60 is ok in investing. Not giving money to a 30 yr old with no track record..

I'm also interested in this. Who are the best young(er) investors? Someone who can compound at good rates for the next decade or two? I'm trying a new approach, want to allocate a small % to these investors. Every year if they beat my performance, I plan on allocating more to them. If they underperform for 3 years, they're out. Currently I have 1. Mohnish (invested in Jan'24) - I like the exposure to markets / companies that I typically don't get. He has underperformed recently, so this is a watch. 2. Ackman - Thinking of starting now. His holdings all look pretty solid (don't see any blowup potential or controversial holdings). Like the recent bet on Nike. Fannie / Freddie are wildcards,

Treasury preferred $190B Other preferred $35B + capital requirements Cash on hand $125B (will be $200B start of '27 as per cbo) How do you cover the shortfall if you are Ackman, issue debt? He's a pretty smart guy who is not going to miss on something as simple as this. Is there any proposal out there from him?

Good report, CBO seems to be positive on the GSEs becoming private. They say new equity needs to be issued. Scenario being analyzed (seems like base case) is 4.5% total value of assets (FHFAs risk based capital requirements), 10% return on capital (expected investor return), 4% growth (GSEs annual earnings) Start of 2027 capital needed = $370B Cash by start of 2027 = $208B Shortfall = $162B They say this shortfall needs to be covered by sale of equity. I assume this is new equity being issued? Current common is valued at $6B. So, when new equity is issued current common will be significantly diluted . What does Ackman see in owning common? In the above scenario, preferred (valued at $35B) will be fully paid. So a 2.5x return from here in another 2 years.

Thanks wondering. Investing in Africa now might pay dividends 5-10 years later. Do you have any thoughts on the companies they are investing in, are they high quality? Do they have any crown jewel kind of investments? I'll also do my research but wanted to get your take.

Curious if anyone has taken a look at Fairfax Africa recently. I have been selling some Fairfax this year (to keep at 30% of my pf but it keeps going up:)) and want to redeploy the cash. Looks like the new guys from Helios haven't made much of an impact, 5 yr return at -50%.

Why are you holding while selling other banks, just sheer quality? I read some reports last week w Dimon saying you should sell a bank at 2x TBV and also Buffett unloading on BAC. East west is not growing that fast and that's one of the reasons I felt 2x TBV might be getting expensive..

Sold East west Bank. Phenomenal bank (don't think you'll ever see NPA assets at 25 basis points!) and great CEO. I bought last year during the Silicon valley bank crisis and it was a quick double. I have mixed feelings on selling, want to hold for many years but at 2x TBV feel is getting expensive..

Thanks. For Freddie, would that be FMCKJ (8.375% non cum)? Also, do ppl here buy a basket of preferreds or just the highest dividend one? Not sure if the various preferreds have different conditions.

I have the common, bought more as a lottery ticket. Now thinking of converting to preferred. Which preferred is better, I want to buy both Fannie and Freddie..

Is that Fairfax India making a move? Wow finally Doubt it, the timing is an election driven rally, probably tied to Trumps' pro India messages (we all know he'll flip on a dime, but will take the 8% pop!). This one is mostly done, the optics of a Canadian company winning one of the high profile deals will be too much for Modi govt. I'm also ok with not winning this one, too big for FFI.

Losing 40% of your pf won't change your life? If that's the case, then taking big swings is ok...you might be at a point in life where investment returns are not meaningful enough for your personal wealth.

30+% in one company is a large position. There's some position where it does become risky, no matter how confident you are about the company. The world is constantly changing, you will have curveballs. Things that are completely outside your ability to predict will happen and sometimes even outside the control of the company. You don't want to get knocked out of the game when something like that hits. And, Fairfax is not Berkshire or Costco. They have done nothing but make great decisions these past 5 years, but they do tend to take big swings, positive (GFC) or negative (hedging). Do you think it'll happen in the next 6 months or so? We have been waiting for it for a while.