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

[Guest Covid-19_Survivor]

Latest from Josh Rosner...

Please see GF&Co's report on #mortgage #Servicers #FHA #FHFA #GSEs & the #CaresAct:

 

One concern of mine has been that people would take 12 months of not paying their mortgage even if economy opens back up in 2 months.  However, Rosner's piece says that the forbearance assistance is only "during the covered period."  Can anybody confirm that the "covered period" officially ends when Trump declares we're no longer in a national emergency?  Does "national emergency" = "covered period"?  Logic would say it does, but I want to be 100% sure. Thanks.

 

Another way to put it, is there a chance "covered period" could mean the 180 days + 180 days and NOT be tied to the status of whether we're in a national emergency or not?

 

I don't have the verbiage per verbatim in front of me but the bill did say that it was while we were in a national emergency. I do remember reading that.

 

(5) COVERED PERIOD.—The term “covered period” means the period beginning on the date of enactment of this Act and ending on the sooner of—

(A) the termination date of the national emergency concerning the novel coronavirus disease (COVID–19) outbreak declared by the President on March 13, 2020 under the National Emergencies Act (50 U.S.C. 1601 et seq.); or

 

(B) December 31, 2020.

 

https://www.congress.gov/bill/116th-congress/house-bill/748/text?loclr=bloglaw#toc-H4D5728D599DE43C1B10376E596A41BCE

 

In plain English this means that from the enacting of CARES until the emergency has ended or 12/31/20, whichever comes first, the 12 month forbearance period may start. It's not good but 1) I don't know if it may be amended, and 2) FnF is paid up on pizzo for the year, so we're good.

[Luke 532]

DS5 (who?! LOL) interview with Calabria: https://dsnews.com/daily-dose/04-06-2020/ds5-fhfa-director-discusses-forbearance

[allnatural]

"But i think at the end of the day if we're through the worst of the virus in the next, another 6 to 8 weeks, then i think we still see a large equity raise by the enterprises in 2021."

 

Also mentioned there are a number of things they need to put in place prior to that (i'm assuming that includes the capital rule and PSPA amendment)

 

DS5 (who?! LOL) interview with Calabria: https://dsnews.com/daily-dose/04-06-2020/ds5-fhfa-director-discusses-forbearance

[investorG]

DS5 (who?! LOL) interview with Calabria: https://dsnews.com/daily-dose/04-06-2020/ds5-fhfa-director-discusses-forbearance

 

Calabria's public attitude about this crisis is likely too relaxed.  Hopefully there's preparation of plan B behind the scenes.  The GSEs likely need capital asap to help out the mortgage system.  Conveniently Mnuchin has a $500bn fund.  While Calabria is wise to do his job as conservator, the MBA'rs are also correct imo, they should inject $ into them, cancel the sr pref, exercise the warrants and let the GSEs serve as intended.  It was their fault they waited 3.5 years now they should rectify their mistake.

[Guest cherzeca]

"The GSEs likely need capital asap to help out the mortgage system."

 

what makes you say this?  the MBA is screaming bloody murder right now since Calabria wont allow GSEs to provide  liquidity to servicers.  are you saying that will be reversed?  do you have any basis for thinking that?

 

do you realize that it is the servicers and not the GSEs who must supply money in lieu of forborne payments. with the GSEs only standing up if there is a default...and forbearance precisely means no default.

 

I thought the GSEs would get hammered by this forbearance schema. the more I actually studied the situation, the better I feel about it...assuming of course that there is an all clear announcement by potus soon (during May) and everyone outside NYC gets back to normal life...and there is a normal life to get back to

[investorG]

"The GSEs likely need capital asap to help out the mortgage system."

 

what makes you say this?  the MBA is screaming bloody murder right now since Calabria wont allow GSEs to prove liquidity to servicers.  are you saying that will be reversed?  do you have any basis for thinking that?

 

do you realize that it is the servicers and not the GSEs who must supply menu in lieu of forborne payments. with the GSEs only standing up if there is a default...and forbearance precisely means no default.

 

I thought the GSEs would get hammered by this forbearance schema. the more I actually studied the situation, the better I feel about it...assuming of course that there is an all clear announcement by potus soon (during May) and everyone outside NYC gets back to normal life...and there is a normal life to get back to

 

10mm people just lost their job, tens of millions more likely to come.  many of these jobs aren't coming back.  it should be red alert time rather than let's stick it to the servicers on technicalities.  citizens are going to need help with their mortgages which means $$.  getting capital into the professional GSEs is likely a more efficient way to deliver this help to Americans than blunt UBI checks.

[Guest cherzeca]

"The GSEs likely need capital asap to help out the mortgage system."

 

what makes you say this?  the MBA is screaming bloody murder right now since Calabria wont allow GSEs to prove liquidity to servicers.  are you saying that will be reversed?  do you have any basis for thinking that?

 

do you realize that it is the servicers and not the GSEs who must supply menu in lieu of forborne payments. with the GSEs only standing up if there is a default...and forbearance precisely means no default.

 

I thought the GSEs would get hammered by this forbearance schema. the more I actually studied the situation, the better I feel about it...assuming of course that there is an all clear announcement by potus soon (during May) and everyone outside NYC gets back to normal life...and there is a normal life to get back to

 

10mm people just lost their job, tens of millions more likely to come.  many of these jobs aren't coming back.  it should be red alert time rather than let's stick it to the servicers on technicalities.  citizens are going to need help with their mortgages which means $$.  getting capital into the professional GSEs is likely a more efficient way to deliver this help to Americans than blunt UBI checks.

 

So far the take up rate has been manageable. That is the data point to focus in on.  Not numbers of unemployment many of whom don’t owe mortgages

[investorG]

"The GSEs likely need capital asap to help out the mortgage system."

 

what makes you say this?  the MBA is screaming bloody murder right now since Calabria wont allow GSEs to prove liquidity to servicers.  are you saying that will be reversed?  do you have any basis for thinking that?

 

do you realize that it is the servicers and not the GSEs who must supply menu in lieu of forborne payments. with the GSEs only standing up if there is a default...and forbearance precisely means no default.

 

I thought the GSEs would get hammered by this forbearance schema. the more I actually studied the situation, the better I feel about it...assuming of course that there is an all clear announcement by potus soon (during May) and everyone outside NYC gets back to normal life...and there is a normal life to get back to

 

10mm people just lost their job, tens of millions more likely to come.  many of these jobs aren't coming back.  it should be red alert time rather than let's stick it to the servicers on technicalities.  citizens are going to need help with their mortgages which means $$.  getting capital into the professional GSEs is likely a more efficient way to deliver this help to Americans than blunt UBI checks.

 

So far the take up rate has been manageable. That is the data point to focus in on.  Not numbers of unemployment many of whom don’t owe mortgages

 

The take up rate will likely either end up very large or be restricted by servicers fumbling the ball.  While I don't believe the 100% numbers it could be 10-50%.  Plus there are renters who won't be able to pay and the GSEs could work better with capital on the multi family side as well.   

 

In addition there's a reasonable chance Calabria isn't around in 9 months.  I think he's saying the right things publicly fwiw.  I'm just thinking a balanced plan B is hopefully being worked on aggressively behind the scenes.  Now that Calabria has stood his ground on conserving, it's mnuchin's choice and I believe non-pspa capital into the Gse's is likely better than the Fed accepting MSRs.     

[Viking]

As the curve flattens (as expected) talk will shift to what is next. Put your seatbelt on as the ride could be bumpy.

 

1.) Businesses that rely on person-to-person contact will continue to suffer

- airlines, hotels, sit down restaurants, cruise/travel etc

2.) How many small and medium sized businesses do not re-open?

3.) What happens to consumer spending?

- people will be concerned about employment situation

- will be needing to pay back debt taken on to weather lock down (back rent, credit card debt etc)

4.) what happens to manufacturing?

- to end 2019, it looked like globe and US was already in a mild manufacturing recession

5.) What happens to US and global GDP?

6.) What happens to US unemployment?

- does it remain elevated and at what level?

 

Trump wants quick economic comeback from coronavirus, but China’s incomplete recovery hints at long-lasting problems

- https://www.washingtonpost.com/business/2020/04/07/trump-china-economy-coronavirus/#comments-wrapper

 

...As the Chinese emerged from quarantine, factories reopened more quickly than restaurants and retail outlets. Any business that relies on person-to person contact is suffering, as consumers remain nervous about catching the sometimes fatal respiratory illness.

 

“People are back at work. But they’re not shopping. They’re not going to restaurants. They’re avoiding public places,” Williams said.

 

... Yet roughly nine weeks after the authorities began urging people to return to work, many Chinese factories are just treading water. They are open for business, but lack orders. Major exporters are especially troubled since their U.S. and European customers have been idled by the pandemic.

 

Lingering Chinese weakness is evident in a Capital Economics index that blends measures of power station activity, property sales, subway ridership and long distance travel. In mid-February, as the government began pushing people to resume work, the index stood at 22 percent of the year-ago level. By mid-March, it reached 52 percent, but today it is only 59 percent.

[Guest cherzeca]

IMF rag indicating servicers will have to advance $20-40B under forbearance scheme.  they will get this money back from the mortgagors (or GSEs if forborne mortgages go into default).  servicers are clamoring for some bridging lending facility from Fed/Treasury etc.  they may get it. servicers are cranky because of this, and because their marks for their mortgage servicing rights are being written down due to an expected refi boom given historically low interest rates.

 

why does this create a massive issue for GSEs over next few months?  I for one will be looking for color from the GSEs when they report 1Q soon, but until then I haven't heard anything in the nature of the "sky is falling" that makes sense.

[Luke 532]

Calabria: No servicer liquidity facility coming, but GSEs may pull servicing from struggling companies

https://www.housingwire.com/articles/calabria-no-servicer-liquidity-facility-coming-but-gses-may-pull-servicing-from-struggling-companies/

 

"...Calabria said they have a plan, but it’s not the one that the industry is calling for."

 

“So, the yes is we have contingency plans and procedures put in place were this distress to happen,” Calabria continued. “So that’s the yes part. The no part is, do we have a liquidity facility that we will be providing via Fannie and Freddie? The answer’s no. We don’t have the resources at Fannie and Freddie to do that.”

 

“Nobody that we’re talking to is seeing 25%, 30%, 40%, 50% take out (in forbearance requests),” Calabria said. “So, I don’t know where those estimates are coming from, because they just don’t match anything we’re seeing at all.”

[Wiggins]

I feel very bullish and hopefully it's not simply because I added yesterday and the JPS are up a lot today.

 

My thinking is:

Forbearance provides relief to mortgagers and massively reduces the probability of many defaults. GSEs thus get a lot of protection and yet bear little of the costs of this program (e.g. Rosner's "scheduled/scheduled" vs "active/active").

 

Much of the earlier selloff in JPS was justified, IMO, since we didn't know how Calabria or Congress was going to respond to this crisis. This would have been a golden opportunity to hobble the positive momentum of the GSEs. But it's now clear Calabria intends to protect the assets of the GSEs, and Congress has not slipped any jumpstart type language into relief bills as they could have. Calabria has confirmed recently his belief they will exit conservatorship as planned, perhaps slightly delayed. ACG which has made a lot of good calls in the last year or so remains bullish. Major stakeholders (e.g. Ackman) remain bullish.

 

Holders of JPS are engaged in a largely binary trade: they will do very well if the GSEs survive and very poorly or be wiped out if they fail. So, how well the economy does and how long it takes to recover and other FUD is largely irrelevant. Actually it does contribute to timing, but the major factor is do they survive or not. Given what we know now, the GSEs are very likely to not only survive but thrive. This will become even more evident after Q1 results. Also, EIDL and PPP loans are going to be pumping billions into the economy.

 

IMHO these latest factors are not very well priced in to the securities, so discounts are to be found. I think the sentiment will change with Q1 earnings release as more capital will be added to the balance sheets and the CEOs reiterate that companies will survive, thrive, etc. going forward despite the Coronavirus. Perhaps also we'll be over the hump of deaths and cases which will help dispel some of the FUD.

 

I'm back to wanting the hear a disconfirming thesis, so I welcome those thoughts.

[Wiggins]

chickens coming home to roost

 

Calabria: No servicer liquidity facility coming, but GSEs may pull servicing from struggling companies

https://www.housingwire.com/articles/calabria-no-servicer-liquidity-facility-coming-but-gses-may-pull-servicing-from-struggling-companies/

 

"...Calabria said they have a plan, but it’s not the one that the industry is calling for."

 

“So, the yes is we have contingency plans and procedures put in place were this distress to happen,” Calabria continued. “So that’s the yes part. The no part is, do we have a liquidity facility that we will be providing via Fannie and Freddie? The answer’s no. We don’t have the resources at Fannie and Freddie to do that.”

 

“Nobody that we’re talking to is seeing 25%, 30%, 40%, 50% take out (in forbearance requests),” Calabria said. “So, I don’t know where those estimates are coming from, because they just don’t match anything we’re seeing at all.”

[Wiggins]

The role Fannie and Freddie play in a downturn is “not to bail out people in the industry,” he said. “Their countercyclical role is to provide mortgage credit, and I see no evidence that that is not happening.” 

 

https://www.wsj.com/articles/fannie-freddie-unlikely-to-aid-mortgage-companies-as-payments-dry-up-fhfa-chief-says-11586289067?shareToken=st0a8ee1e33baa4c79a6f7127c67fef349

[Guest cherzeca]

"The GSEs likely need capital asap to help out the mortgage system."

 

what makes you say this?  the MBA is screaming bloody murder right now since Calabria wont allow GSEs to prove liquidity to servicers.  are you saying that will be reversed?  do you have any basis for thinking that?

 

do you realize that it is the servicers and not the GSEs who must supply menu in lieu of forborne payments. with the GSEs only standing up if there is a default...and forbearance precisely means no default.

 

I thought the GSEs would get hammered by this forbearance schema. the more I actually studied the situation, the better I feel about it...assuming of course that there is an all clear announcement by potus soon (during May) and everyone outside NYC gets back to normal life...and there is a normal life to get back to

 

10mm people just lost their job, tens of millions more likely to come.  many of these jobs aren't coming back.  it should be red alert time rather than let's stick it to the servicers on technicalities.  citizens are going to need help with their mortgages which means $$.  getting capital into the professional GSEs is likely a more efficient way to deliver this help to Americans than blunt UBI checks.

 

So far the take up rate has been manageable. That is the data point to focus in on.  Not numbers of unemployment many of whom don’t owe mortgages

 

The take up rate will likely either end up very large or be restricted by servicers fumbling the ball.  While I don't believe the 100% numbers it could be 10-50%.  Plus there are renters who won't be able to pay and the GSEs could work better with capital on the multi family side as well.   

 

In addition there's a reasonable chance Calabria isn't around in 9 months.  I think he's saying the right things publicly fwiw.  I'm just thinking a balanced plan B is hopefully being worked on aggressively behind the scenes.  Now that Calabria has stood his ground on conserving, it's mnuchin's choice and I believe non-pspa capital into the Gse's is likely better than the Fed accepting MSRs.   

 

so far the take up rate for GSE mortgages is 2%; so far, you are dead wrong.  and this is an issue for servicers in the first instance...

[investorG]

 

so far the take up rate for GSE mortgages is 2%; so far, you are dead wrong.  and this is an issue for servicers in the first instance...

 

data as of april 1.  the law was signed on mar27.  we'll see where it ends up.

[Guest Covid-19_Survivor]

I feel very bullish and hopefully it's not simply because I added yesterday and the JPS are up a lot today.

 

My thinking is:

Forbearance provides relief to mortgagers and massively reduces the probability of many defaults. GSEs thus get a lot of protection and yet bear little of the costs of this program (e.g. Rosner's "scheduled/scheduled" vs "active/active").

 

Much of the earlier selloff in JPS was justified, IMO, since we didn't know how Calabria or Congress was going to respond to this crisis. This would have been a golden opportunity to hobble the positive momentum of the GSEs. But it's now clear Calabria intends to protect the assets of the GSEs, and Congress has not slipped any jumpstart type language into relief bills as they could have. Calabria has confirmed recently his belief they will exit conservatorship as planned, perhaps slightly delayed. ACG which has made a lot of good calls in the last year or so remains bullish. Major stakeholders (e.g. Ackman) remain bullish.

 

Holders of JPS are engaged in a largely binary trade: they will do very well if the GSEs survive and very poorly or be wiped out if they fail. So, how well the economy does and how long it takes to recover and other FUD is largely irrelevant. Actually it does contribute to timing, but the major factor is do they survive or not. Given what we know now, the GSEs are very likely to not only survive but thrive. This will become even more evident after Q1 results. Also, EIDL and PPP loans are going to be pumping billions into the economy.

 

IMHO these latest factors are not very well priced in to the securities, so discounts are to be found. I think the sentiment will change with Q1 earnings release as more capital will be added to the balance sheets and the CEOs reiterate that companies will survive, thrive, etc. going forward despite the Coronavirus. Perhaps also we'll be over the hump of deaths and cases which will help dispel some of the FUD.

 

I'm back to wanting the hear a disconfirming thesis, so I welcome those thoughts.

 

Probably just look at petroleum industry to gauge disconnect. You think if it thought this pandemic would be resolved in 2-3 months, a barrel would be selling for $25?

 

Probably not. Good luck and keep your hedges active.

 

[Wiggins]

Not sure this is the best representative given OPEC and Russia's actions of late. They're reversing too little too late

 

I feel very bullish and hopefully it's not simply because I added yesterday and the JPS are up a lot today.

 

My thinking is:

Forbearance provides relief to mortgagers and massively reduces the probability of many defaults. GSEs thus get a lot of protection and yet bear little of the costs of this program (e.g. Rosner's "scheduled/scheduled" vs "active/active").

 

Much of the earlier selloff in JPS was justified, IMO, since we didn't know how Calabria or Congress was going to respond to this crisis. This would have been a golden opportunity to hobble the positive momentum of the GSEs. But it's now clear Calabria intends to protect the assets of the GSEs, and Congress has not slipped any jumpstart type language into relief bills as they could have. Calabria has confirmed recently his belief they will exit conservatorship as planned, perhaps slightly delayed. ACG which has made a lot of good calls in the last year or so remains bullish. Major stakeholders (e.g. Ackman) remain bullish.

 

Holders of JPS are engaged in a largely binary trade: they will do very well if the GSEs survive and very poorly or be wiped out if they fail. So, how well the economy does and how long it takes to recover and other FUD is largely irrelevant. Actually it does contribute to timing, but the major factor is do they survive or not. Given what we know now, the GSEs are very likely to not only survive but thrive. This will become even more evident after Q1 results. Also, EIDL and PPP loans are going to be pumping billions into the economy.

 

IMHO these latest factors are not very well priced in to the securities, so discounts are to be found. I think the sentiment will change with Q1 earnings release as more capital will be added to the balance sheets and the CEOs reiterate that companies will survive, thrive, etc. going forward despite the Coronavirus. Perhaps also we'll be over the hump of deaths and cases which will help dispel some of the FUD.

 

I'm back to wanting the hear a disconfirming thesis, so I welcome those thoughts.

 

Probably just look at petroleum industry to gauge disconnect. You think if it thought this pandemic would be resolved in 2-3 months, a barrel would be selling for $25?

 

Probably not. Good luck and keep your hedges active.

[Guest cherzeca]

 

so far the take up rate for GSE mortgages is 2%; so far, you are dead wrong.  and this is an issue for servicers in the first instance...

 

data as of april 1.  the law was signed on mar27.  we'll see where it ends up.

 

no, we already know where it ends up...you said 10-50%...which is a range of many millions of mortgages.

[Guest Covid-19_Survivor]

Not sure this is the best representative given OPEC and Russia's actions of late. They're reversing too little too late

 

I feel very bullish and hopefully it's not simply because I added yesterday and the JPS are up a lot today.

 

My thinking is:

Forbearance provides relief to mortgagers and massively reduces the probability of many defaults. GSEs thus get a lot of protection and yet bear little of the costs of this program (e.g. Rosner's "scheduled/scheduled" vs "active/active").

 

Much of the earlier selloff in JPS was justified, IMO, since we didn't know how Calabria or Congress was going to respond to this crisis. This would have been a golden opportunity to hobble the positive momentum of the GSEs. But it's now clear Calabria intends to protect the assets of the GSEs, and Congress has not slipped any jumpstart type language into relief bills as they could have. Calabria has confirmed recently his belief they will exit conservatorship as planned, perhaps slightly delayed. ACG which has made a lot of good calls in the last year or so remains bullish. Major stakeholders (e.g. Ackman) remain bullish.

 

Holders of JPS are engaged in a largely binary trade: they will do very well if the GSEs survive and very poorly or be wiped out if they fail. So, how well the economy does and how long it takes to recover and other FUD is largely irrelevant. Actually it does contribute to timing, but the major factor is do they survive or not. Given what we know now, the GSEs are very likely to not only survive but thrive. This will become even more evident after Q1 results. Also, EIDL and PPP loans are going to be pumping billions into the economy.

 

IMHO these latest factors are not very well priced in to the securities, so discounts are to be found. I think the sentiment will change with Q1 earnings release as more capital will be added to the balance sheets and the CEOs reiterate that companies will survive, thrive, etc. going forward despite the Coronavirus. Perhaps also we'll be over the hump of deaths and cases which will help dispel some of the FUD.

 

I'm back to wanting the hear a disconfirming thesis, so I welcome those thoughts.

 

Probably just look at petroleum industry to gauge disconnect. You think if it thought this pandemic would be resolved in 2-3 months, a barrel would be selling for $25?

 

Probably not. Good luck and keep your hedges active.

 

Ok. I'd argue but ok.

 

May I interest you in a few hotel cumulative preferreds paying 20+ divi's than? I mean, all you have to do is wait out 2-3 months and you're golden, right? How about Warren selling his airlines near bottom? He would be doing the opposite if this was just a 2-3 month hiccup.

 

Anyway, you asked and that is my answer. No one knows how long this madness will continue. But I will opine that it's going to last a lot longer then 2-3 months.

 

[Wiggins]

I did ask; thanks for answering.

Selecting the hardest hit sectors (airlines, hotels) as representative of the entire economy is pretty absurd.

Why not include ZM, NFLX, AMZN?

My point is yes, some sectors are screwed for a while. I wouldn't own DAL right now either. But I believe the economy will be solidly on the upswing within 2 months. That's just what I think. I could be wrong. Thanks for your thoughts.

 

Not sure this is the best representative given OPEC and Russia's actions of late. They're reversing too little too late

 

I feel very bullish and hopefully it's not simply because I added yesterday and the JPS are up a lot today.

 

My thinking is:

Forbearance provides relief to mortgagers and massively reduces the probability of many defaults. GSEs thus get a lot of protection and yet bear little of the costs of this program (e.g. Rosner's "scheduled/scheduled" vs "active/active").

 

Much of the earlier selloff in JPS was justified, IMO, since we didn't know how Calabria or Congress was going to respond to this crisis. This would have been a golden opportunity to hobble the positive momentum of the GSEs. But it's now clear Calabria intends to protect the assets of the GSEs, and Congress has not slipped any jumpstart type language into relief bills as they could have. Calabria has confirmed recently his belief they will exit conservatorship as planned, perhaps slightly delayed. ACG which has made a lot of good calls in the last year or so remains bullish. Major stakeholders (e.g. Ackman) remain bullish.

 

Holders of JPS are engaged in a largely binary trade: they will do very well if the GSEs survive and very poorly or be wiped out if they fail. So, how well the economy does and how long it takes to recover and other FUD is largely irrelevant. Actually it does contribute to timing, but the major factor is do they survive or not. Given what we know now, the GSEs are very likely to not only survive but thrive. This will become even more evident after Q1 results. Also, EIDL and PPP loans are going to be pumping billions into the economy.

 

IMHO these latest factors are not very well priced in to the securities, so discounts are to be found. I think the sentiment will change with Q1 earnings release as more capital will be added to the balance sheets and the CEOs reiterate that companies will survive, thrive, etc. going forward despite the Coronavirus. Perhaps also we'll be over the hump of deaths and cases which will help dispel some of the FUD.

 

I'm back to wanting the hear a disconfirming thesis, so I welcome those thoughts.

 

Probably just look at petroleum industry to gauge disconnect. You think if it thought this pandemic would be resolved in 2-3 months, a barrel would be selling for $25?

 

Probably not. Good luck and keep your hedges active.

 

Ok. I'd argue but ok.

 

May I interest you in a few hotel cumulative preferreds paying 20+ divi's than? I mean, all you have to do is wait out 2-3 months and you're golden, right? How about Warren selling his airlines near bottom? He would be doing the opposite if this was just a 2-3 month hiccup.

 

Anyway, you asked and that is my answer. No one knows how long this madness will continue. But I will opine that it's going to last a lot longer then 2-3 months.

[muscleman]

 

I have an exactly opposite view than most of you here. I had a tight stop and was stopped out of my big 20% position last Thursday and since then I've been flat. I was gonna post this yesterday but was too busy.

I think a major top is right here. $14 is the key resistance for FMCKJ. The market reaction has never been worse. A positive court ruling only caused a false break out. Then this Monday's 20bn capital retaining news only caused a big volume down day, followed by another big volume down day yesterday. If you look at the daily chart since the positive court ruling and count how many down days you get vs the up days, and the volume on the only 3 up days, you'll see how little buying there was.

This is the one of the few classic topping actions.

I don't see any reason to continue holding this stock. It will either go flat or go down.

 

This will be my last TA post here. I don't like being taunted over and over by lots of you. Thanks!

 

This was my post some time last year.

I know a lot of you disagreed with me strongly at that time. Looking at it now, it was the correct reading.

[investorG]

Hopefully Calabria is working on Plan B behind the scenes.  He could accomplish 2 objectives with one stone by ditching his 4 year template plan and negotiating with Trump/Mnuchin to invest some non-PSPA $$ into the companies asap in conjunction with a Collins settlement and a 4th amendment that deems the sr pref appropriately paid off.  The litigants should forget the 30bn overpayment as their contribution.  FnF would then be in position for real forbearance, refinance (tighter spreads), and modification relief for knocked down citizens.

 

On the current path the pressure he's putting on the servicers will likely lead them in many instances to drag their feet on modifications or use unhelpful tricks like upfront lump sum payments when the forbearance period ends.  Trump is possibly losing marginal votes relative to the alternative of an active FnF providing widespread relief to Americans.  In addition, Calabria's not making many friends right now and is likely out in 9 months if a Dem wins.

 

[Guest cherzeca]

"In addition, Calabria's not making many friends right now and is likely out in 9 months if a Dem wins."

 

thank god we finally have as a fhfa director a non-politician with integrity, a backbone and more than a half of a brain.  that he is not a poontang chaser is extra credit

[Midas79]

This was my post some time last year.

I know a lot of you disagreed with me strongly at that time. Looking at it now, it was the correct reading.

 

Gloating over what amounts to a lucky guess is poor form. From what I remember, some of us didn't disagree with your conclusions but instead the methods used to come to them. There is nothing to suggest that your investing method produces reliable results.

 

Perhaps you really do have a real alpha-generating system that the rest of us just don't understand. But one data point doesn't prove anything.