Make money doing the work you believe in
Fannie and Freddie are falling. The 200B MBS buy order does not hurt them. This is exactly what they do- it is their business. It in fact means to do more they need to raise capital, and the way to do that is an IPO.
What I said in my December post below- I think we are in this lull now.
“Again there are many scenarios here.
So this is neither an automatic nor a necessarily quick win for long-suffering common and junior preferred stockholders.
If the companies do not go public, they will continue to build their respective capital reserves and shrink ERCF funding shortfalls. This means there is not a lot of financial pressure from within the GSEs themselves to move the IPO up on the President’s agenda. They become better capitalized the longer the IPO is put off.
True investors can take heart that further delays alone do not destroy value, as both are now growing book value by double digits. Sentiment will likely drive the securities down significantly if the next year is unproductive on the IPO front, but that could be an opportunity for long-term investors.”
