A Logistical Analysis. Freddie Mac potential Liquidity and Capital Resources. The recent acquisition of Freddie Mac and Fannie Mae, in the way in which it was done, has left very little room for productive asset liquidation. cash cows they are not. Freddie Mac Balance Sheets.
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And though the P/E Price to Equity ratio has been severely eroded in the stock price there are still monies that can be ascertained for not only U.S. treasury savings, but also, I believe, Freddie Mac common shares, and Lehman Brothers Neuberger as a whole.
The estimated 690,606,185 common shares outstanding of Freddie Mac as of the cooperation date went uncompensated in the takeover.
And although the price of the stocks declined rather sharply, rather quickly the Assetto Asset LiabilityRatio in Freddie Mac should still remain relatively high given the circumstances.
This is because Freddie’s financial obligations which were leveraged by the sale of stock in the company were relatively few as they chose to leverage mostly in the bond markets, or notional securities. Thus mitigating the sustained losses on the balance sheet from the lowering in the stock price rather effectively.
However this by no means means that there is a net positive swap on the asset to asset debt obligations ratio. This is what accounted for the losses in the previous quarters of this year and the over $3 billion dollars in losses on the balance sheets last year.
There are U.S. dollar reference note securities that are now liquid in nature due to the fact that this was money that the U.S. government owed Freddie Mac through it’s bond markets.
However now that the U.S. government owns Fannie Mae and Freddie Mac through its cooperative agreement these funds totaling $51 billion dollars should now be considered liquid in nature due to the fact that investors and are no longer obligated to expect maturity in these notes.
These monies therefore can be to cover the sustained losses in the common shares due to the nature of the cooperative.
If out of the estimated $51 billion dollars available we use $20 billion to buy back or compensate the estimated 690,606,185 shares outstanding at the time of the acquisition we will have given the common shares stock holder $28.96/ common share. That is a current price increase of $28.49/ common share.
In addition the retained portfolio for the obligations of available for sale securities of states and political sub divisions equates to $14.578 billion dollars.
These additional funds (potentially totaling $45.578 billion) can be used further to help bailout Lehman brothers, and also cover the expenses of any future write downs which may occur in the financial sector due to the housing market woes.