Core Viewpoint - Investor Michael Burry holds significant positions in Fannie Mae and Freddie Mac, indicating a bullish outlook on their potential re-listing and future performance [1][5]. Group 1: Investment Position - Michael Burry has a sizable stake in both Fannie Mae and Freddie Mac common stock, reflecting confidence in their future prospects [5][8]. - The shares of Fannie Mae and Freddie Mac have shown volatility, with Fannie Mae rising by 2% and Freddie Mac by 2.4% on December 8, and both have increased approximately 12% since late November [5]. Group 2: IPO Challenges and Projections - Burry outlines several challenges that must be addressed for the IPOs of Fannie Mae and Freddie Mac, including easing capital requirements, converting preferred shares to common stock, and reducing government claims on the companies [6]. - He anticipates that the IPOs could be priced at 1x to 1.25x times the book value, with potential trading at 1.5x to 2x times the book value within 1-2 years post-listing [6]. Group 3: Market Dynamics and Support - Burry notes that without government withdrawal, the common shares of Fannie Mae and Freddie Mac are essentially "worthless," highlighting the need for regulatory changes [6]. - There is speculation that Berkshire Hathaway may take a substantial position in the upcoming IPOs, as Warren Buffett's company previously held a stake in Fannie Mae [7].
Michael Burry owns ‘sizable’ Fannie Mae and Freddie Mac common stock, believes re-listing for both ‘nearly upon us’