Lets make the assumption that FandF are "released" from the C-ships and some modest "settlement" with the US Government is reached. That for whatever reason, perhaps means some dilution... but not 80% and some something, whatever it is...
Okay based on that premise... that FandF get "released" - Considering the new fee structure and possibly a structure that pays or forces FandF to "accumulate" excess reserves for catestrophic loan loss provisions.
What would be a fair "price for Fannie Mae Common Stock...
$40, $50, ? $80, $100?
What say thee?
Will the government use the holiday season to announce - some sort of rethinking of fandf? Meaning will they use the low news cycle - to make the subtle announcement? Perhaps on a Friday ahead of the Christmas week? or maybe next Friday in between Christmas and New Years? Could be good timing to ease out some "news".
The only way for the government to keep from having to pay $50B - $100B in damages to shareholders is to 1) release them. 2) re-cut the deal with themselves (lower interest rate; not stealing shares) 3) they should consider that right now the government has an open credit card to add stuff to the debt to allow for a settlement of say $15B to shareholders / lawyers in a massive Class Action. They could probably use the money they are rapping the banks for to pay this $15B - transfer of $$.
Ya know... I've been thinking about that... at $70 bucks a share and a 2.4% divy... = $1.68 annually or 42c quarter .... well FNMA would be my pension.
Air, et al...
Funny odd... too... back in 2012 I sold shares in AER and bought Fly - this was in maybe September 2012... before they did that disaster of a move in November and then of course the secondary debacle this summer. Up until the summer shafting, Fly had been the better move... I think AER was trading at around 13 and Fly 12 or so. Anyway... even with divy' Fly is now "Up" around $4 and AER would have been up $20.... So, I too got hosed by what we all believed to have been the "better" stewards.
Good thing is... when i sold AER i only sold about 20% of my holdings in them.. so this has been a rewarding week - overall.
I expect somehow Fly will figure it out and they'll probably just let AER or AL buy them out in the Spring or by next Fall. I really don't see them lasting as independent. I'd take a stock swap from AL at say 4 for 5 ratio and be done. GLTA
poor andse... you know nothing regarding economics. nothing. So, just because thousands of penguins jump into the cold water you would too? Just because everyone else does it makes it right with you? lol... silly ol' andse...
This is really disingenuous 1. it really hurts prospective home sellers by making home buyers access to capital less. Which in turn will decrease or hold down home prices. 2. its not a market driven decision and because of that its anti- business. Its an artificial cap that changes the landscape.
I would agree that if interest rates head higher - its going to mean more house trading in the short term and hold down prices in the mid term.
10 percent should be reduced to 3% market rate *TARP" price paid by banks.
You know... maybe we could put together a piece of money and bail out the US postal service - under the very same terms and conditions?
Wow an ELECTION to the BOD... i must have missed the PROXY Vote... somehow... .... perhaps this should say was appointed ... but even that would be silly.
My guess is AIG will then distribute the 46% interest to its shareholders in a non taxable distribution - so that they can have LTGain treatment if they later decide to sell.
4 eps x 10 multiple = 40+ share price. Also, I'd expect AER to initiate a dividend thereafter. Question is does AER have the band width in mgmt to swallow iflc? Would this deal close next summer?
I don't like the dilution afforded by the issuance of 100M shares. Yes that's 900 M gain to AIG. not AER
Chess... I am older than many on this board.
I am probably over di-worsefied... I have positions in around 9 companies that make up around 40% and another 40% in mutual funds with the remainder in smaller one off investments. Fannie makes up just a portion of those 9.. Unfortunately, i just couldn't "speculate" further because at 20c a share and all the bad PR i took a contrarian approach and was brazen in my staunch belief that fandf were not to be blamed and were the victims not the perpetrators. While I've got more than the OP's share count I just couldn't risk the "bigger money". Even though this could turn out to me the opportunity of a lifetime. As it is now its incredible going from 25c to 2.80... thats 10x. As for selling... i'll either be handsomely rewarded at 200 a share of.. be heading for the exits at near 0 ... only time will tell and i am prepared to lose 100%. I'll hate it; but nothing ventured nothing gained.
Talk to me about your options strategy here. I've been doing some "numbers" and working figures. My gut feeling is the future is bright for ACT - but with the share price at 160ish - how best to take advantage. Thoughts?