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Senate bill would wind down Frannie

  • Buying low and selling high in the GSEs continues unabated as a long-awaited bipartisan Senate bill is introduced to continue government backing of mortgages, but wind down Fannie Mae (FNMA +4.5%) and Freddie Mac (FMCC +4.7%).
  • The White House: “We support this effort and believe it is a workable bipartisan approach to complete the biggest remaining piece of post-recession financial reform.”
  • A bill in the more conservative House would more or less cut the government out of housing finance. With elections months away, the chance of any sort of reform becoming law this year are probably slim.
Comments (17)
  • MichiganTrader
    , contributor
    Comments (73) | Send Message
     
    Trimmed my position today in FNMA. Curious to see how this will play out. Big risk and big reward.
    11 Mar 2014, 01:11 PM Reply Like
  • Topcat
    , contributor
    Comments (484) | Send Message
     
    Not to mention that our bailout of Fan and Fred is paying a very nice profit to us taxpayers! (which we deserve for risking our money)...no hurry on the wind down please.
    11 Mar 2014, 01:12 PM Reply Like
  • adhuntr
    , contributor
    Comments (3) | Send Message
     
    What's wrong with Fannie and Freddie now? They're both making a ton of cash. Everyone knows it was the banks that caused the problem.
    11 Mar 2014, 01:12 PM Reply Like
  • oilman545
    , contributor
    Comments (64) | Send Message
     
    I thought when the government sold shares of FNMA FMCC it was giong to work for the benefit of the shareholders. So, the government can't just wind it down if its profitable. I counting the lawsuits on it starting now. It will be in the courts for a long time and the government's reason will not be good enough for a judge.
    11 Mar 2014, 01:17 PM Reply Like
  • Blitztour
    , contributor
    Comments (67) | Send Message
     
    March 2nd 2014
    "And I may be completely wrong, but I really expect a big selloff when it hits the $5-$6 range as the Institutional investors try to close out the quarter with big gains for their books.
    But I never expect to see either of these stocks close below $3.50 again and believe if this dip occurs, it will be short lived. Those sitting on the sidelines waiting to buy will jump in and this stock will hit and sustain $7 + before the end of June. After that, it’s on its way to the Bove # and beyond."

     

    Did i call it or what : )
    11 Mar 2014, 02:10 PM Reply Like
  • davi10398
    , contributor
    Comments (4) | Send Message
     
    do you think that this is the bottom then? I pulled the trigger to early and bought some in the low $4s
    11 Mar 2014, 03:08 PM Reply Like
  • BuyToSell
    , contributor
    Comments (225) | Send Message
     
    And an hour after this came out - 50% drop. Zoiks.
    11 Mar 2014, 02:40 PM Reply Like
  • aleichner
    , contributor
    Comments (4) | Send Message
     
    If the government wanted the ability to unilaterally dismantle them, they should have taken 100 percent of the stock for the bailout. Failing to do that means that other investors have a right to a reasonable valuation based on earnings to take their shares. Based on earnings and a 10 times multiple, Ackerman's 35-45 range seems right.
    Aside from that, in a time of tremendous government debt, why not let both rise naturally by taking out that fear component and let the taxpayers reap the benefits of debt reduction by selling the shares into the open market?
    11 Mar 2014, 03:07 PM Reply Like
  • Jnap
    , contributor
    Comments (3) | Send Message
     
    Let's see what Judge Sweeney has to say about this!!!!

     

    And 1 stunning date from Judge Sweeney - March 20, 2014
    11 Mar 2014, 03:07 PM Reply Like
  • Jnap
    , contributor
    Comments (3) | Send Message
     
    Humm, We bailed out the auto industry and they have not repaid a penny to the Taxpayers. FNMA and FMCC have totally repaid the Gov't and the taxpayers and Prez Obama Budget estimates they will pay 179 BILLION more by 2024.
    11 Mar 2014, 03:07 PM Reply Like
  • Bradgrp61172
    , contributor
    Comments (40) | Send Message
     
    Whenever the government see F&F stock price going up like crazy, they announce that they've reached an agreement or they've worked out some sticking point with reform of the GSEs. I believe they know how profitable these companies are and they want the individual shareholders to liquidate their positions so the government is not on the hook to pay them for any lose on the GSEs.

     

    Housing reform should be focused on the loan originators, not the secondary market.
    11 Mar 2014, 03:07 PM Reply Like
  • southbaysteve
    , contributor
    Comments (4) | Send Message
     
    Sold out my whole position and everyone around me. I doubt the bill will pass. So, once we find out I'm back in. It's dropping like a rock and it took over 2 hours for it to start.
    11 Mar 2014, 03:07 PM Reply Like
  • James Myung
    , contributor
    Comments (327) | Send Message
     
    Can foreigners buy this share? I tried to buy around 8000 shares, but my investment account keep popping out error messages. I need to get clarify this issue with my banker!!!!!!!!!!
    11 Mar 2014, 03:54 PM Reply Like
  • User 16914952
    , contributor
    Comment (1) | Send Message
     
    I also think the risk is to high.. I sold my 36,000 shares 1 week ago.
    11 Mar 2014, 04:10 PM Reply Like
  • cdameworth
    , contributor
    Comments (33) | Send Message
     
    It's nice to see another one of these postings after a sizable gain. Same post occurred last year when it was in the 5.00 range. This is of course pending some litigation to determine whether or not the government has the right to "wind down" a publicly traded company.
    11 Mar 2014, 04:10 PM Reply Like
  • wpdsr001
    , contributor
    Comments (60) | Send Message
     
    That's fine, I am all for government getting out of what should be private business.

     

    But as usual, the Geniuses in Washington failed to put anything in place to take up the slack.

     

    If they did not destroy the housing market through mortgages the first, they will complete the job this time.

     

    Damn
    11 Mar 2014, 05:35 PM Reply Like
  • cletuschukwu
    , contributor
    Comments (4) | Send Message
     
    When is the court ruling coming????? That's the million dollar question.
    12 Mar 2014, 09:39 AM Reply Like
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