yes Remember the CBO report of 1/10 that was discussed here (find by CBO in FNM)
The TREAS has calculated an amount they EXPECT to infuse into FNM and FRE for each of the next 9 years
I think the CASH inflow to the GSEs (from memory?) for the FISCAL year of the GOV TREAS we are in is 30B.....
So the TREAS and in theory the pps has built into it a greater then 5B draw or infusion .......
All that in the context of the main issue at the end (in part a function of total cash infusions) - is - how much ownership (equity) in FNM or a successor company is left for the current 100% equity owners of FNM
My bet has been 20% for months now - of what I hope is a 25-50 dollar stock ..... based on more infusions of cash but to much more
We will see
But 5B would be a delightful numbe to see as I believe each of the last three quarter FNM has drawn about 15B or more - and my expectaion is for something in the TEENS (as the infused dollars from TREAS to FNM for more preferred stock)
So it is more then 5B - yes likely - but if say less then last quarter (15? or whatever) --- would that be bad or GRRRREAT news?
5B for sure would IMO be GRRRRReat news - if that is the infusion amount any single digit billion IMO is better then expected news
This says they will take a $5B charge off in the current quarter to adjust for tax credits they cannot use. By 'draws' do you mean investment from the government? As far as I read this article said nothing about the amount of infusion(if any) FNM would need for Q4. We won't know that until they release their earnings. This article was mostly about FRE.
In article it states that Freddie will have to obtain addition bailout dollars from US Treasury in the 1Q. It states Fannie may need a bailout 5 Billion 1Q. No big deal, it was projected they would need $23 Billion for the year 2010 in a Dec or Jan announcement. So if Fannie gets 5 Billion, so be it. Correct, they have not report earnings yet. This is the setup announcement so no surprises at 1Q announcement in May or June.