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

[Gregmal]

This is a straight forward, asymmetric wager/investment. Nothing more, nothing less. I own some of the preferreds.

 

oh god, maybe is time to sell....

 

The time to sell was in Nov 2016. This has been by far one of my worst investments/biggest wastes of time. I made the mistake of buying this in 2013/4 and adhering to the "real investors dont trade" narrative. That Mnuchin would take care of the hedge fund guys. I switched all common to preferreds a few years back. But the truth is that unless you're simply trading this like muscleman, its been a total dud. But whatever. Cant win em all.

[muscleman]

@muscleman

 

texas v Pa et al was a case that if scotus took seriously Texas would have won. they ran away from it. so this clearly was a case where scotus worked back from what it thought was the proper result, and found the way to get there. Roberts may have his institutional reasons not to have given Texas its due, but this is not the rule of law but rather rule of the institutionally desired outcome.

 

you saw some of that in the Collins argument, with the acting D hypo getting way more than its due...because the acting D was not removable at will on the merits.  but that would be the only way to decide the constitutional claim in favor of govt, without being inconsistent with seila, so scotus embraced it at least as a hypo to see where it would lead.

 

Yeah exactly. The justices are being heavily influenced by the politicians and got pushed their way.

I suspect that they got personally threatened too, especially after GA governor Brian Kemp's daughter's bf who died in an "accident" (car exploded) one day after Brian called for signature verification on the ballots.

 

Before this 2020 election I thought the US judicial system is not as corrupt as I hope so I invested in FnF preferred. But I don't have any expectation for that now.

[muscleman]

This is a straight forward, asymmetric wager/investment. Nothing more, nothing less. I own some of the preferreds.

 

oh god, maybe is time to sell....

 

The time to sell was in Nov 2016. This has been by far one of my worst investments/biggest wastes of time. I made the mistake of buying this in 2013/4 and adhering to the "real investors dont trade" narrative. That Mnuchin would take care of the hedge fund guys. I switched all common to preferreds a few years back. But the truth is that unless you're simply trading this like muscleman, its been a total dud. But whatever. Cant win em all.

 

Just to clarify, after May 2019, this is the first buy signal I got this week, but it is a weak signal. Given it is a weak signal and given how much confidence I have lost in the judicial system, I am not buying this time.

 

[Gregmal]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I haven't obsessed over the investment the way many have. Its always kind of been a "total write-off or huge homerun" investment in my book. I'm glad I didnt make it a huge position or spend time reading the tea leaves any time anyone even remotely associated with this did so much as fart...but you are right that the absolute corruption of the system really seems to work against this fundamentally. At the same time, selling here feels like leaving the movie with 15 minutes left.

[muscleman]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I haven't obsessed over the investment the way many have. Its always kind of been a "total write-off or huge homerun" investment in my book. I'm glad I didnt make it a huge position or spend time reading the tea leaves any time anyone even remotely associated with this did so much as fart...but you are right that the absolute corruption of the system really seems to work against this fundamentally. At the same time, selling here feels like leaving the movie with 15 minutes left.

 

Trump has far more urgent things to do in the next 35 days than releasing FnF. Given the alt left's attitude toward him, I think his entire business may face bankruptcy soon once he leaves the POTUS position. The left will show the country whoever goes against them will end up bankrupt, and probably in prison, so in the future no more Trumps will show up. Only RINOs and alt left socialists.

 

But I just don't see how Trump can turnaround himself at this moment. I feel really sad for him and for this country.

 

[Sunrider]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I haven't obsessed over the investment the way many have. Its always kind of been a "total write-off or huge homerun" investment in my book. I'm glad I didnt make it a huge position or spend time reading the tea leaves any time anyone even remotely associated with this did so much as fart...but you are right that the absolute corruption of the system really seems to work against this fundamentally. At the same time, selling here feels like leaving the movie with 15 minutes left.

 

Trump has far more urgent things to do in the next 35 days than releasing FnF. Given the alt left's attitude toward him, I think his entire business may face bankruptcy soon once he leaves the POTUS position. The left will show the country whoever goes against them will end up bankrupt, and probably in prison, so in the future no more Trumps will show up. Only RINOs and alt left socialists.

 

But I just don't see how Trump can turnaround himself at this moment. I feel really sad for him and for this country.

 

We’re getting far away from FNMA here ... but how is what you predict about Trump any different from what it’s been the last  years. He only cares about himself, not about anyone else, not the country, and if he had to, he’d also throw Kushy Ivanka etc to the wolves .... do you really think he cares about some HF ‘buddy’ - his world is transactional and he’s made a reputation (fortune: more questionable) out of conning people (steaks anyone? Trump university to make you rich?).

 

Look at Georgia - do you think he gives a flying crap about the two Republican senators ... or ‘his’ party? It was never his. He’s got a party of one only.

 

Whatever you believe about left or right, this man as president really has been a shame for the country. He spits on the service of those who gave their lives for the country and calls them stupid. The US was always great, and didn’t need a bumbling want-to-be emperor to make it a reality TV show.

 

Back to FNMA - if you want to put your faith in any politician doing something for his pals it’s still Mnuchin ... whether that’s a good bet or not, who knows .... ? Clearly it hasn’t been for the last four years (and I’ve been holding for far longer trusting that the courts will eventually end this madness).

 

 

[typicalvalue]

Looking at the recent replies on this thread it's clear why JPS trade at such depressed valuation (investors are burnt on this), but given recent words of Mnuchin this will get done before inauguration, I'm fairly confident. Being done does not imply a massive deal for shareholders this will be a take it or leave it situation. If not this will be in limbo for years if Biden is planning redoing the capital rule, etc. or litigating to the infinite (heard they are running out of money so not so much left). If someone still believes that courts are the solution to the Gse's problem is off, administrative action is the only way.

[TwoCitiesCapital]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I haven't obsessed over the investment the way many have. Its always kind of been a "total write-off or huge homerun" investment in my book. I'm glad I didnt make it a huge position or spend time reading the tea leaves any time anyone even remotely associated with this did so much as fart...but you are right that the absolute corruption of the system really seems to work against this fundamentally. At the same time, selling here feels like leaving the movie with 15 minutes left.

 

Trump has far more urgent things to do in the next 35 days than releasing FnF. Given the alt left's attitude toward him, I think his entire business may face bankruptcy soon once he leaves the POTUS position. The left will show the country whoever goes against them will end up bankrupt, and probably in prison, so in the future no more Trumps will show up. Only RINOs and alt left socialists.

 

But I just don't see how Trump can turnaround himself at this moment. I feel really sad for him and for this country.

 

Good thing Trump already has a lot of practice with going bankrupt! Even before the left hated him! And maybe all those colleagues of his who are in jail can help him navigate the internal social hierarchies if he joins them.

 

 

As an American, I haven't seen anything out if the judicial system that concerns me just yet. I don't think the case with Texas was ignored or thrown out for political reasons - I think it's because it's become evident through the dozens of other lawsuits that there is nothing to substantiate the claims. We, as a democracy, cannot throw out votes just because we don't like them and the SC has seemingly done the correct thing in response.

 

The real threat here is what it's been for the last 8 years I've owned this - timing/delays. I can only hope this is coming to and end one way or another.

[muscleman]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I haven't obsessed over the investment the way many have. Its always kind of been a "total write-off or huge homerun" investment in my book. I'm glad I didnt make it a huge position or spend time reading the tea leaves any time anyone even remotely associated with this did so much as fart...but you are right that the absolute corruption of the system really seems to work against this fundamentally. At the same time, selling here feels like leaving the movie with 15 minutes left.

 

Trump has far more urgent things to do in the next 35 days than releasing FnF. Given the alt left's attitude toward him, I think his entire business may face bankruptcy soon once he leaves the POTUS position. The left will show the country whoever goes against them will end up bankrupt, and probably in prison, so in the future no more Trumps will show up. Only RINOs and alt left socialists.

 

But I just don't see how Trump can turnaround himself at this moment. I feel really sad for him and for this country.

 

Good thing Trump already has a lot of practice with going bankrupt! Even before the left hated him! And maybe all those colleagues of his who are in jail can help him navigate the internal social hierarchies if he joins them.

 

 

As an American, I haven't seen anything out if the judicial system that concerns me just yet. I don't think the case with Texas was ignored or thrown out for political reasons - I think it's because it's become evident through the dozens of other lawsuits that there is nothing to substantiate the claims. We, as a democracy, cannot throw out votes just because we don't like them and the SC has seemingly done the correct thing in response.

 

The real threat here is what it's been for the last 8 years I've owned this - timing/delays. I can only hope this is coming to and end one way or another.

 

What you said is completely wrong. The Texas case is based on one simple FACT, which is that only congress has the authority to modify the law. The state governors have no authority to modify the law. Those four states modified the law by the governor, with strong objection from their state congresses.

 

This is a black and white case.

 

We can spend hours arguing whether the "fraud evidence" floating on the internet is true or fake, but the above is FACT.

 

Have you seen the lawsuit from PA congress about that? They did it when the PA governor changed the election law in early 2020, and the PA court said the PA congress has no standing because there is no harm yet. They sued again right after election and the PA court said the case is out because it is too late and they should have sued earlier. Does that not make you concerned about the US judicial system?

 

[Guest cherzeca]

@MM

 

you are right for the wrong reason.  only the state legislatures have authority to change the election laws in their various states (not congress).  in the four defendant states, non-legislative actors did.  there were no facts needed to be determined in order to decide this pure question of law.  defendant states were losers on this legal question.

 

now facts came into play to determine whether the P states claims were consequential, meaning outcome determinative.  P states presented plenty of evidence to show that, but I could see scotus if it took the case saying that the facts alleged were unproven, you need a trial, and you dont have time for a trial because we are not going to stay the EC...but scotus didnt do that, they wimped out on standing.

[muscleman]

@MM

 

you are right for the wrong reason.  only the state legislatures have authority to change the election laws in their various states (not congress).  in the four defendant states, non-legislative actors did.  there were no facts needed to be determined in order to decide this pure question of law.  defendant states were losers on this legal question.

 

now facts can into play to determine whether the P states claims were consequential, meaning outcome determinative.  P states presented plenty of evidence to show that, but I could see scotus if it took the case saying that the facts alleged were unproven, you need a trial, and you dont have time for a trial because we are not going to stay the EC...but scotus didnt do that, they wimped out on standing.

 

Thank you Chris. I thought state congress is the same thing as state legislature but it seems like there is no such a thing as state congress.

 

 

[investorG]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I haven't obsessed over the investment the way many have. Its always kind of been a "total write-off or huge homerun" investment in my book. I'm glad I didnt make it a huge position or spend time reading the tea leaves any time anyone even remotely associated with this did so much as fart...but you are right that the absolute corruption of the system really seems to work against this fundamentally. At the same time, selling here feels like leaving the movie with 15 minutes left.

 

Trump has far more urgent things to do in the next 35 days than releasing FnF. Given the alt left's attitude toward him, I think his entire business may face bankruptcy soon once he leaves the POTUS position. The left will show the country whoever goes against them will end up bankrupt, and probably in prison, so in the future no more Trumps will show up. Only RINOs and alt left socialists.

 

But I just don't see how Trump can turnaround himself at this moment. I feel really sad for him and for this country.

 

Welcome back Muscleman, your presence makes this board more interesting.  Hard to feel sad for Trump when he punted on addressing FnF for 47 months; given the slim margins in many swing states, even partially recapitalized GSEs would have likely won him the electoral college through juicing the economy during the pandemic. 

[investorG]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I haven't obsessed over the investment the way many have. Its always kind of been a "total write-off or huge homerun" investment in my book. I'm glad I didnt make it a huge position or spend time reading the tea leaves any time anyone even remotely associated with this did so much as fart...but you are right that the absolute corruption of the system really seems to work against this fundamentally. At the same time, selling here feels like leaving the movie with 15 minutes left.

 

Trump has far more urgent things to do in the next 35 days than releasing FnF. Given the alt left's attitude toward him, I think his entire business may face bankruptcy soon once he leaves the POTUS position. The left will show the country whoever goes against them will end up bankrupt, and probably in prison, so in the future no more Trumps will show up. Only RINOs and alt left socialists.

 

But I just don't see how Trump can turnaround himself at this moment. I feel really sad for him and for this country.

 

We’re getting far away from FNMA here ... but how is what you predict about Trump any different from what it’s been the last  years. He only cares about himself, not about anyone else, not the country, and if he had to, he’d also throw Kushy Ivanka etc to the wolves .... do you really think he cares about some HF ‘buddy’ - his world is transactional and he’s made a reputation (fortune: more questionable) out of conning people (steaks anyone? Trump university to make you rich?).

 

Look at Georgia - do you think he gives a flying crap about the two Republican senators ... or ‘his’ party? It was never his. He’s got a party of one only.

 

Whatever you believe about left or right, this man as president really has been a shame for the country. He spits on the service of those who gave their lives for the country and calls them stupid. The US was always great, and didn’t need a bumbling want-to-be emperor to make it a reality TV show.

 

Back to FNMA - if you want to put your faith in any politician doing something for his pals it’s still Mnuchin ... whether that’s a good bet or not, who knows .... ? Clearly it hasn’t been for the last four years (and I’ve been holding for far longer trusting that the courts will eventually end this madness).

 

Off topic but might want to check out the reception Trump received at the Army Navy Game this weekend.

[doc75]

@MM

 

you are right for the wrong reason.  only the state legislatures have authority to change the election laws in their various states (not congress).  in the four defendant states, non-legislative actors did.  there were no facts needed to be determined in order to decide this pure question of law.  defendant states were losers on this legal question.

 

now facts can into play to determine whether the P states claims were consequential, meaning outcome determinative.  P states presented plenty of evidence to show that, but I could see scotus if it took the case saying that the facts alleged were unproven, you need a trial, and you dont have time for a trial because we are not going to stay the EC...but scotus didnt do that, they wimped out on standing.

 

I know you're a lawyer (and I'm certainly not) but you really seem to be in the minority legal opinion here and yet you're stating your position as legal fact.  Are there any prominent constitutional attorneys who believed SCOTUS would or should hear this case?    I've been looking for these voices and can't find them.

 

In any case, this outcome was predicted by literally every source I could find, aside from pundits on Fox, Newsmax etc. or folks like Ted Cruz who are effectively party to the suit.  Ben Ginsberg was asked if he thought SCOTUS would entertain the case and his response was "not for an instant", after which he went on to describe why they don't have standing, and why all the amici briefs and state court cases further weaken the argument for standing. 

 

Not to mention that Thomas & Alito said they wouldn't grant relief. 

 

Regarding states rights to change election laws: My understanding is that the legislatures have the authority to determine the manner in which elections are carried out (e.g. by popular vote) but it's entirely within their right to cede authority for  implementation to the state electoral commissions, which were created for the express purpose of carrying out elections. 

 

I mean no disrespect to you or your opinion.  I am trying to reconcile what you write as fact with everything else I've read.

 

 

 

 

 

 

[Guest cherzeca]

@doc

 

I said IF scotus took the case, P states had a good legal claim.  the "twitter lawyers" you refer to all said scotus would not take the case, either just by exercising discretion to decline jurisdiction (which is what scotus did for example in a state v state dispute about water rights) or by finding that P states had no Article III standing...which is where it came out...so there was no discussion of the merits.  capiche?

 

the thing I am thinking through is given Mnuchin said Treasury would do an amendment in order for the GSEs to raise capital, is there any reason not to fully eliminate the senior prefs?  will he try to convert all of the senior prefs into common?  cant see GSEs raising capital as a practical matter unless all of the SP will be extinguished

[lnofeisone]

The courts are just icing on the cake in terms of a resounding conclusion. The real confidence killer was that we just had every ally we could have asked for with the current administration and after 4 years have absolutely zero to show for it other than wasted time and some pipe dream that it's going to get done in the next 40 days when reality is, they just had 4 years and dicked around with everything but the one thing we needed them to. I'm not selling, I feel I owe myself that much after not selling for the past 7/8 years outside of repositioning some common into preferreds, but I aint holding my breathe either.

 

I've come to this conclusion too (and don't think SCOTUS will resolve all issues) . I've traded in and out and holding what is essentially free shares but not holding my breath for anything spectacular either.

[doc75]

@doc

 

I said IF scotus took the case, P states had a good legal claim.  the "twitter lawyers" you refer to all said scotus would not take the case, either just by exercising discretion to decline jurisdiction (which is what scotus did for example in a state v state dispute about water rights) or by finding that P states had no Article III standing...which is where it came out...so there was no discussion of the merits.  capiche?

 

 

Thanks for the feedback, much appreciated.

 

Parenthetical remark on merits:  I didn't read the entire complaint, but the inclusion of such an obviously bogus statistical analysis leads me to believe the entire exercise was mostly theatre.  I have to assume that the even the plaintiffs didn't really expect their case would be heard, despite all protestations to the contrary.

 

 

[TwoCitiesCapital]

@MM

 

you are right for the wrong reason.  only the state legislatures have authority to change the election laws in their various states (not congress).  in the four defendant states, non-legislative actors did.  there were no facts needed to be determined in order to decide this pure question of law.  defendant states were losers on this legal question.

 

now facts can into play to determine whether the P states claims were consequential, meaning outcome determinative.  P states presented plenty of evidence to show that, but I could see scotus if it took the case saying that the facts alleged were unproven, you need a trial, and you dont have time for a trial because we are not going to stay the EC...but scotus didnt do that, they wimped out on standing.

 

Thank you Chris. I thought state congress is the same thing as state legislature but it seems like there is no such a thing as state congress.

 

My apologies. Let my assumptions get the best of me. Figured this case was no different than all of the others that have been tossed for being B.S. hard to know what's legitimate with the party that has cried wolf a thousand times in response to the elections and has been wrong on most counts.

 

Full disclosure: right leaning independent here, so don't toe the left party line. Just sick of this circus surrounding all the election "fraud" BS coming out of the right. Like children throwing a tantrum and I let my assumptions get the best of me.

[Luke 532]

Fannie Mae is asking key employees to be prepared to work through the holidays as the mortgage giant plots a potential 11th-hour release from government control

 

https://www.businessinsider.com/fannie-mae-exit-conservatorship-employees-trump-mnuchin-freddie-mac-2020-12?s=09

[Guest cherzeca]

Fannie Mae is asking key employees to be prepared to work through the holidays as the mortgage giant plots a potential 11th-hour release from government control

 

https://www.businessinsider.com/fannie-mae-exit-conservatorship-employees-trump-mnuchin-freddie-mac-2020-12?s=09

 

thanks Luke. interesting that the Fannie recipient of the email doesn't want to share email with Bloomberg or WSJ.  love it!

[typicalvalue]

New by the Wall Street Journal (Mr. Ackerman) https://www.wsj.com/articles/fannie-freddie-privatization-decisions-likely-to-be-left-to-biden-administration-11608028200

 

Seems like we are getting lots of inputs on both sides.

[TonyG]

am i crazy or does that entire WSJ not reflect  what Mnuchin actually said?..

[investorG]

New by the Wall Street Journal (Mr. Ackerman) https://www.wsj.com/articles/fannie-freddie-privatization-decisions-likely-to-be-left-to-biden-administration-11608028200

 

Seems like we are getting lots of inputs on both sides.

 

It could be accurate.

 

It also could be that Mnuchin saw the business insider article and didn't want any FnF issues this week during negotiations and so he called the WSJ writer with some non-binding quotes.

[typicalvalue]

New by the Wall Street Journal (Mr. Ackerman) https://www.wsj.com/articles/fannie-freddie-privatization-decisions-likely-to-be-left-to-biden-administration-11608028200

 

Seems like we are getting lots of inputs on both sides.

 

It could be accurate.

 

It also could be that Mnuchin saw the business insider article and didn't want any FnF issues this week during negotiations and so he called the WSJ writer with some non-binding quotes.

 

Makes lots of sense

[COBFInfinity]

I wish Mnuchin would stop talking and just do something, whatever it is. However, my general take is this: Four years ago, Mnuchin arrived on the scene and said, "I'm the quarterback, I'm going to get this done." Today, he says, "I'm the punter, it's not my problem."