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

[Jcmeg35]

Unreal. Pre-market bid/ask imply that commons will be down slightly while preferreds get hammered again. A lot of people must have read a different agreement than I did last night.

 

The disparity in the commons vs. preferred has been around a while, but the common have really outperformed Preferred since the start of the year. My guess is that it is a result of both liquidity and where fast money was positioned on the expectation that this announcement would be more positive.

[investorG]

Unreal. Pre-market bid/ask imply that commons will be down slightly while preferreds get hammered again. A lot of people must have read a different agreement than I did last night.

 

The disparity in the commons vs. preferred has been around a while, but the common have really outperformed Preferred since the start of the year. My guess is that it is a result of both liquidity and where fast money was positioned on the expectation that this announcement would be more positive.

 

big $$ readers of this board won't get comfortable unless muscleman returns with a buy signal.  his calls on this stock, however he makes them, are legendary.

[locutusoftexas]

there are roadblocks set up here. but if we get a scotus win, then they can be dealt with. if not then not

What are the reasons to stay in this investment? On a first look at what came out today there are a lot of roadblocks and we become dependent on two parties... treasury and JPS. Each with their own motivations. To me the whole the preferred shares could be worth $40 is dangerous. We currently have a FHFA who just got screwed by Mnuchin and was ready to make significant progress. We have less than 1/2 a year till we potentially have an unfriendly FHFA director.

it's not a slam dunk and many will exit but the reasons would be a) the low price b) potential court victories and their impact on stock price even if still in conservatorship and c) Tsy might want to move the ball forward at some point for progress / collect their billions for pet projects.

 

I have no intentions to exit my position. While Yellen/Biden were briefed on the LA, what's to say they don't decide to make another agreement?

 

Here is what I see as to deciding to remain in this investment:

 

(1) Assess the odds of positive court outcomes and account for the length of time for the court to announce a decision. This thread has just the person to do that: cherzeca. If the odds and estimated time to decision meet your value criterion, then stay.

 

(2) Assess the odds that the government will reach a plan and release them and estimate the value based on that plan, including the time elapsed from now to the implementation of the plan. If the value is greater than the current price and the estimated time elapsed meets an obvious criterion for estimating present value of future payments, then stay.

 

(3) Ockham's Razor: Past is prologue and people don't change. The court case will take "forever" and the odds are at best 50-50 that the decision will be positive for current shareholders. Further the Democrats are Democrats and will not be favorable to present private shareholders. Sell, sell, sell and then sell again.

 

 

[james22]

Elusive indeed.

[typicalvalue]

Given that our win maybe depends on SCOTUS, would be nice if @cherzeca could provide us some light on what expects from that and if outcome puts us in a more position of power.

[Guest cherzeca]

there are roadblocks set up here. but if we get a scotus win, then they can be dealt with. if not then not

What are the reasons to stay in this investment? On a first look at what came out today there are a lot of roadblocks and we become dependent on two parties... treasury and JPS. Each with their own motivations. To me the whole the preferred shares could be worth $40 is dangerous. We currently have a FHFA who just got screwed by Mnuchin and was ready to make significant progress. We have less than 1/2 a year till we potentially have an unfriendly FHFA director.

it's not a slam dunk and many will exit but the reasons would be a) the low price b) potential court victories and their impact on stock price even if still in conservatorship and c) Tsy might want to move the ball forward at some point for progress / collect their billions for pet projects.

 

I have no intentions to exit my position. While Yellen/Biden were briefed on the LA, what's to say they don't decide to make another agreement?

 

Here is what I see as to deciding to remain in this investment:

 

(1) Assess the odds of positive court outcomes and account for the length of time for the court to announce a decision. This thread has just the person to do that: cherzeca. If the odds and estimated time to decision meet your value criterion, then stay.

 

(2) Assess the odds that the government will reach a plan and release them and estimate the value based on that plan, including the time elapsed from now to the implementation of the plan. If the value is greater than the current price and the estimated time elapsed meets an obvious criterion for estimating present value of future payments, then stay.

 

(3) Ockham's Razor: Past is prologue and people don't change. The court case will take "forever" and the odds are at best 50-50 that the decision will be positive for current shareholders. Further the Democrats are Democrats and will not be favorable to present private shareholders. Sell, sell, sell and then sell again.

 

Correct process. No comment on conclusion

 

I will do a deep dive in Collins and publish it in a couple of weeks but my assessment that Ps win APA claim is much higher than 50%. This would lead to either a trial or more likely summary judgment motion in lieu of trial. If SJ motion that would be in fall. If trial then later. Decision early 2022?  Depends on court calendar. The constitutional claim would be quicker and my view of odds are about 50%. Not because I don’t think Ps case isn’t strong but because scotus was trying to squirm around it in orals.

 

So timeframe is important both in terms of your patience capacity and IRR hurdles but also because the longer this takes the more likely that the effing Ds do something crappy again.

 

Edit. My personal view is that if Ds in Congress actually do something re GSEs it will take the form of some kind of utility regulation statute as opposed to any wind down proposal. But this still leaves the question of status of SP as determining JP value, and that will require a scotus win

[Mephistopheles]

I think the political route is dead. Mnuchin/Trump, for all their incentives, and big donors being pref holders, were not able to privatize the companies in 4 years. To me it means there are so many internal road blocks that even the Sec of Treasury was unable to pull it off. Now we have a President and new team that have stated that they are in no rush to privatize. These are the same people who implemented the NWS in the first place. I give it zero odds for them to make any deal.

 

So now all we have is the Courts and it's above my pay grade to analyze that. 

[typicalvalue]

there are roadblocks set up here. but if we get a scotus win, then they can be dealt with. if not then not

What are the reasons to stay in this investment? On a first look at what came out today there are a lot of roadblocks and we become dependent on two parties... treasury and JPS. Each with their own motivations. To me the whole the preferred shares could be worth $40 is dangerous. We currently have a FHFA who just got screwed by Mnuchin and was ready to make significant progress. We have less than 1/2 a year till we potentially have an unfriendly FHFA director.

it's not a slam dunk and many will exit but the reasons would be a) the low price b) potential court victories and their impact on stock price even if still in conservatorship and c) Tsy might want to move the ball forward at some point for progress / collect their billions for pet projects.

 

I have no intentions to exit my position. While Yellen/Biden were briefed on the LA, what's to say they don't decide to make another agreement?

 

Here is what I see as to deciding to remain in this investment:

 

(1) Assess the odds of positive court outcomes and account for the length of time for the court to announce a decision. This thread has just the person to do that: cherzeca. If the odds and estimated time to decision meet your value criterion, then stay.

 

(2) Assess the odds that the government will reach a plan and release them and estimate the value based on that plan, including the time elapsed from now to the implementation of the plan. If the value is greater than the current price and the estimated time elapsed meets an obvious criterion for estimating present value of future payments, then stay.

 

(3) Ockham's Razor: Past is prologue and people don't change. The court case will take "forever" and the odds are at best 50-50 that the decision will be positive for current shareholders. Further the Democrats are Democrats and will not be favorable to present private shareholders. Sell, sell, sell and then sell again.

 

Correct process. No comment on conclusion

 

I will do a deep dive in Collins and publish it in a couple of weeks but my assessment that Ps win APA claim is much higher than 50%. This would lead to either a trial or more likely summary judgment motion in lieu of trial. If SJ motion that would be in fall. If trial then later. Decision early 2022?  Depends on court calendar. The constitutional claim would be quicker and my view of odds are about 50%. Not because I don’t think Ps case isn’t strong but because scotus was trying to squirm around it in orals.

 

So timeframe is important both in terms of your patience capacity and IRR hurdles but also because the longer this takes the more likely that the effing Ds do something crappy again.

 

Thanks looking out to dig in that piece when its out. Now you are probably the most valuable in this board.

[TwoCitiesCapital]

I think the political route is dead. Mnuchin/Trump, for all their incentives, and big donors being pref holders, were not able to privatize the companies in 4 years. To me it means there are so many internal road blocks that even the Sec of Treasury was unable to pull it off. Now we have a President and new team that have stated that they are in no rush to privatize. These are the same people who implemented the NWS in the first place. I give it zero odds for them to make any deal.

 

So now all we have is the Courts and it's above my pay grade to analyze that.

 

I don't buy that they couldn't. Mnuchin just did some stuff proving he could do stuff -  He just didn't do the stuff WE wanted.

 

We can all guess to the reasons why. Maybe it was more important to him to incentivize quick action on the release to avoid Demz screwing it up than it was to ensure rule of law and shareholders' claims were upheld? I don't pretend to know.

 

It's amazing that we're here though - the case seemed so obvious to me even before I invested. It was clear to me there was a wrong that needed to be rectified, and would be, because this is AMERICA and that was my thesis back in 2012. It's amazing to me after 8-9 years, we've made very little progress on that front and have had multiple cases go against us...

 

No idea yet on what I'm going to do. Would love to think I could 7x my money from here in preferred going to par in the next 2 years, but I've been telling myself "it'll be the next 2 years" for the last 8 years. At some point, I just need to throw in the towel. Patience hasn't been a virtue here.

 

[buffetteer1984]

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

[investorG]

I think the political route is dead. Mnuchin/Trump, for all their incentives, and big donors being pref holders, were not able to privatize the companies in 4 years. To me it means there are so many internal road blocks that even the Sec of Treasury was unable to pull it off. Now we have a President and new team that have stated that they are in no rush to privatize. These are the same people who implemented the NWS in the first place. I give it zero odds for them to make any deal.

 

So now all we have is the Courts and it's above my pay grade to analyze that.

 

I don't buy that they couldn't. Mnuchin just did some stuff proving he could do stuff -  He just didn't do the stuff WE wanted.

 

We can all guess to the reasons why. Maybe it was more important to him to incentivize quick action on the release to avoid Demz screwing it up than it was to ensure rule of law and shareholders' claims were upheld? I don't pretend to know.

 

It's amazing that we're here though - the case seemed so obvious to me even before I invested. It was clear to me there was a wrong that needed to be rectified, and would be, because this is AMERICA and that was my thesis back in 2012. It's amazing to me after 8-9 years, we've made very little progress on that front and have had multiple cases go against us...

 

No idea yet on what I'm going to do. Would love to think I could 7x my money from here in preferred going to par in the next 2 years, but I've been telling myself "it'll be the next 2 years" for the last 8 years. At some point, I just need to throw in the towel. Patience hasn't been a virtue here.

 

Same thesis.  But started a little later.  Thought Ginsburg would be the honorable hero.  That flopped.  Then Mnuchin.  Wrong.  Who's next to disappoint?

 

Anyway I guess current fair value is around 8-9 for this dog (25 par) and thus I'm invested to maximum (un)comfort.

[COBFInfinity]

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

 

Finally, someone here to ask: Why buy a preferred with a 0% coupon? I know it's slightly cheaper, but you are betting really heavily on the assumption that it will be treated the same as the rest of the preferreds in an exchange/dividend resumption. Are you not concerned that it will be left outstanding at only trade at 50-60% of par while everyone else has cashed out at 100%?

[buffetteer1984]

We really don't know how any of the preferreds will be treated but if they all get something much higher than these prices all i can do is buy the lowest price (as margin of safety) and hope for the best.  Price dictates my purchases much more than the speculation of the outcome of each class.  But if i were to speculate it wouldn't be that big a difference.  Even with a 60% par the returns at this point would still be very attractive especially if a settlement gets done sooner than later. What's really the point of the govt sitting on this now that they can't sweep the profits?

 

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

 

Finally, someone here to ask: Why buy a preferred with a 0% coupon? I know it's slightly cheaper, but you are betting really heavily on the assumption that it will be treated the same as the rest of the preferreds in an exchange/dividend resumption. Are you not concerned that it will be left outstanding at only trade at 50-60% of par while everyone else has cashed out at 100%?

[COBFInfinity]

We really don't know how any of the preferreds will be treated but if they all get something much higher than these prices all i can do is buy the lowest price (as margin of safety) and hope for the best.  Price dictates my purchases much more than the speculation of the outcome of each class.  But if i were to speculate it wouldn't be that big a difference.  Even with a 60% par the returns at this point would still be very attractive especially if a settlement gets done sooner than later. What's really the point of the govt sitting on this now that they can't sweep the profits?

 

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

 

Finally, someone here to ask: Why buy a preferred with a 0% coupon? I know it's slightly cheaper, but you are betting really heavily on the assumption that it will be treated the same as the rest of the preferreds in an exchange/dividend resumption. Are you not concerned that it will be left outstanding at only trade at 50-60% of par while everyone else has cashed out at 100%?

 

So you think FNMAP going from $8 to $30 is just as good as a fixed rate preferred going from $8.50 to $50? Your calculator might be broken.

[buffetteer1984]

I guess my point is we don't know what the outcome will be but when they trade higher (possibly before any resolution) i'd like to get something lower in price that may have more upside as it trades back up.

 

We really don't know how any of the preferreds will be treated but if they all get something much higher than these prices all i can do is buy the lowest price (as margin of safety) and hope for the best.  Price dictates my purchases much more than the speculation of the outcome of each class.  But if i were to speculate it wouldn't be that big a difference.  Even with a 60% par the returns at this point would still be very attractive especially if a settlement gets done sooner than later. What's really the point of the govt sitting on this now that they can't sweep the profits?

 

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

 

Finally, someone here to ask: Why buy a preferred with a 0% coupon? I know it's slightly cheaper, but you are betting really heavily on the assumption that it will be treated the same as the rest of the preferreds in an exchange/dividend resumption. Are you not concerned that it will be left outstanding at only trade at 50-60% of par while everyone else has cashed out at 100%?

 

So you think FNMAP going from $8 to $30 is just as good as a fixed rate preferred going from $8.50 to $50? Your calculator might be broken.

[investorG]

We really don't know how any of the preferreds will be treated but if they all get something much higher than these prices all i can do is buy the lowest price (as margin of safety) and hope for the best.  Price dictates my purchases much more than the speculation of the outcome of each class.  But if i were to speculate it wouldn't be that big a difference.  Even with a 60% par the returns at this point would still be very attractive especially if a settlement gets done sooner than later. What's really the point of the govt sitting on this now that they can't sweep the profits?

 

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

 

Finally, someone here to ask: Why buy a preferred with a 0% coupon? I know it's slightly cheaper, but you are betting really heavily on the assumption that it will be treated the same as the rest of the preferreds in an exchange/dividend resumption. Are you not concerned that it will be left outstanding at only trade at 50-60% of par while everyone else has cashed out at 100%?

 

So you think FNMAP going from $8 to $30 is just as good as a fixed rate preferred going from $8.50 to $50? Your calculator might be broken.

 

your assumptions may be off.  Also ideally rather than waiting for par we might want to convert sooner -- if that option is available -- for less than par. 

[Jcmeg35]

What's really the point of the govt sitting on this now that they can't sweep the profits?

 

The last letter agreement reduced the incentive for the government profiting, but since liquidation preference was and is still in place, one can make the argument they profit, but at a later date. I, personally, am dubious of the idea that the NWS being ended suddenly creates some kind of urgency for a Yellen Admin to settle. There is clear incentive for JPS to settle (and I now think Par is a best-case scenario), but I just don't see it on the Treasury side. If UST was willing to roll the dice on SCOTUS hearing the case, they are not gonna get religion now and settle before ruling. Seems like only thing that could do the trick would be a major adverse ruling from SCOTUS, as others have echoed.

[COBFInfinity]

We really don't know how any of the preferreds will be treated but if they all get something much higher than these prices all i can do is buy the lowest price (as margin of safety) and hope for the best.  Price dictates my purchases much more than the speculation of the outcome of each class.  But if i were to speculate it wouldn't be that big a difference.  Even with a 60% par the returns at this point would still be very attractive especially if a settlement gets done sooner than later. What's really the point of the govt sitting on this now that they can't sweep the profits?

 

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

 

Finally, someone here to ask: Why buy a preferred with a 0% coupon? I know it's slightly cheaper, but you are betting really heavily on the assumption that it will be treated the same as the rest of the preferreds in an exchange/dividend resumption. Are you not concerned that it will be left outstanding at only trade at 50-60% of par while everyone else has cashed out at 100%?

 

So you think FNMAP going from $8 to $30 is just as good as a fixed rate preferred going from $8.50 to $50? Your calculator might be broken.

 

your assumptions may be off.  Also ideally rather than waiting for par we might want to convert sooner -- if that option is available -- for less than par.

 

The point is there are ZERO scenarios in which the outcome for a 0% preferred is better than one of the fixed rate preferred. However, there are MULTIPLE scenarios in which the outcome is worse - and when it is worse, it may be far worse. So it doesn't seem to me that a $0.50 discount in price is sufficient for that extra risk.

[investorG]

What's really the point of the govt sitting on this now that they can't sweep the profits?

 

The last letter agreement reduced the incentive for the government profiting, but since liquidation preference was and is still in place, one can make the argument they profit, but at a later date. I, personally, am dubious of the idea that the NWS being ended suddenly creates some kind of urgency for a Yellen Admin to settle. There is clear incentive for JPS to settle (and I now think Par is a best-case scenario), but I just don't see it on the Treasury side. If UST was willing to roll the dice on SCOTUS hearing the case, they are not gonna get religion now and settle before ruling. Seems like only thing that could do the trick would be a major adverse ruling from SCOTUS, as others have echoed.

 

If Tsy wins Collins they will have even more leverage to cram down / monetize the full amt of the sr pref.  granted we'd have less leverage and less upside but that's different than the impetus to act by Tsy.  And it takes a while from settlement until Tsy sees the actual cash (rather than an accounting entry). 

 

I think the mkt is underestimating tsy's incentives to move and instead leaning on (valid) frustration + a couple headlines that Biden's team will sit still.

 

also ron klain who is to biden as mnuchin was to trump, I think tim howard said he's a fan of FnF, used to lobby for them.

[investorG]

We really don't know how any of the preferreds will be treated but if they all get something much higher than these prices all i can do is buy the lowest price (as margin of safety) and hope for the best.  Price dictates my purchases much more than the speculation of the outcome of each class.  But if i were to speculate it wouldn't be that big a difference.  Even with a 60% par the returns at this point would still be very attractive especially if a settlement gets done sooner than later. What's really the point of the govt sitting on this now that they can't sweep the profits?

 

Is the risk reward here not the best it's been in some time?  We're months away from a potential positive ruling (stocks will likely trade higher in anticipation of a victory), prices at close to 5 year lows and a defined path to recap and release.  Even if you've been in this trade for a decade getting out now almost seems like a complete waste of time.  People need to remember even the worse companies trade much higher on a turn of sentiment.  I see this selloff in the more illiquid preferred as a huge opportunity.  Loading up fnmap this morning

 

Finally, someone here to ask: Why buy a preferred with a 0% coupon? I know it's slightly cheaper, but you are betting really heavily on the assumption that it will be treated the same as the rest of the preferreds in an exchange/dividend resumption. Are you not concerned that it will be left outstanding at only trade at 50-60% of par while everyone else has cashed out at 100%?

 

So you think FNMAP going from $8 to $30 is just as good as a fixed rate preferred going from $8.50 to $50? Your calculator might be broken.

 

your assumptions may be off.  Also ideally rather than waiting for par we might want to convert sooner -- if that option is available -- for less than par.

 

The point is there are ZERO scenarios in which the outcome for a 0% preferred is better than one of the fixed rate preferred. However, there are MULTIPLE scenarios in which the outcome is worse - and when it is worse, it may be far worse. So it doesn't seem to me that a $0.50 discount in price is sufficient for that extra risk.

 

you may be right.  I have avoided those as well.  but 50cents is 12% which isn't insignificant.

[WB_fan82]

Cherzeca,

 

Let's assume for a second that the FHFA is unconstitutional, but Ps still lose Collins b/c of the acting director point and the SC just changes the statute to make director removeable for cause.  The 3rd Amendment stays.

 

Couldn't the government, at any time in the next 6 years, claim that THIS 4th Amendment is invalid b/c FHFA was unconstitutional? 

[TwoCitiesCapital]

Cherzeca,

 

Let's assume for a second that the FHFA is unconstitutional, but Ps still lose Collins b/c of the acting director point and the SC just changes the statute to make director removeable for cause.  The 3rd Amendment stays.

 

Couldn't the government, at any time in the next 6 years, claim that THIS 4th Amendment is invalid b/c FHFA was unconstitutional?

 

Wouldn't that mean ALL amendments were unconstitutional and be a big win for us? I might not be a lawyer, but it seems odd to pick and choose which amendments would be considered invalid at that point in time.

[COBFInfinity]

The point is there are ZERO scenarios in which the outcome for a 0% preferred is better than one of the fixed rate preferred. However, there are MULTIPLE scenarios in which the outcome is worse - and when it is worse, it may be far worse. So it doesn't seem to me that a $0.50 discount in price is sufficient for that extra risk.

 

you may be right.  I have avoided those as well.  but 50cents is 12% which isn't insignificant.

6%, actually.

[Guest cherzeca]

Cherzeca,

 

Let's assume for a second that the FHFA is unconstitutional, but Ps still lose Collins b/c of the acting director point and the SC just changes the statute to make director removeable for cause.  The 3rd Amendment stays.

 

Couldn't the government, at any time in the next 6 years, claim that THIS 4th Amendment is invalid b/c FHFA was unconstitutional?

 

you are ignoring the APA claim, which would void the NWS.  as to your question, govt has argued before scotus that any remedy should be prospective only, and scotus doesn't like 180 degree turnarounds in positions

[WB_fan82]

Ok, I'll take it to the next level.  Let's assume APA claim survives dismissal and gets remanded back.

 

If Collins then loses on APA, aren't we back to a point where the govt has a lookback period to scotch the 4th amendment b/c it was done while FHFA was unconstitutional?  Then all the retained earnings would be owed in cash under the 3rd amendment.

 

I'm trying to sniff out any way for there to be unilateral action here, even if Calabria is willing to stick it out and make exiting cship his primary objective over time, but I just keep coming back to nothing works unless TSY plays ball.

 

If Collins wins on APA, then 3rd amendment becomes void, but then what happens to the 4th amendment?  Does it disappear too?!  Or does it hinge on whether FHFA was kosher, so the courts would assume it's its own independent action and keep it since the president had oversight in the event FHFA is OK, but if FHFA is not OK then the 4th stays around until someone challenges (or ratifies?) it and we go back to the 2nd amendment?

 

I'm trying to sketch out the scenarios forward and they are a total mess.  Even the "wins" leave a pile of problems!