Fannie Mae and Freddie Mac allowed to boost their capital

Whitney Tilson’s email to investors discussing Fannie, Freddie Allowed to Boost Capital Buffers by Billions; How I managed risk; How to invest like Warren Buffett; Warren Buffett Protege to Leave Berkshire, Start Own Firm; Class participation strategy No. 3.

fannie freddie allowed to boost

Image source: Fannie Mae

1) Good news this morning for government-sponsored entities Fannie Mae (FNMA) and Freddie Mac (FMCC), as the Treasury has effectively ended the illegal “net worth sweep“: Fannie, Freddie Allowed to Boost Capital Buffers by Billions – Bloomberg. Excerpt:

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Q2 hedge fund letters, conference, scoops etc

The agencies said they may make additional tweaks to Fannie and Freddie's capital structures, as well. The moves are all part of an effort – outlined in a plan released by Treasury earlier this month – to end the companies' decade long conservatorships and return them to the private market.

In the category of speculative investments – meaning positions sized 3% or smaller – Fannie Mae continues to be my favorite.

2) In this video from one of my seminars a year ago, I answered a student's question about How I Managed Risk (5:02).

3) I'm quoted in this CNBC article on How to invest like Warren Buffett. Excerpt:

Former hedge-fund manager and Buffett follower Whitney Tilson attributes the 89-year-old's success to his "off-the-charts smarts," his more than seven decades of experience and his temperament.

,............

However, don't invest everything Buffett-style, warned Tilson.

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So, if you want to invest like Buffett, do it with 10%, 20% or 30% of your total investments and put the rest in an index fund, he said.

4) I wish Tracy the best and am sure she'll be successful: Warren Buffett Protege to Leave Berkshire, Start Own Firm. Excerpt:

Tracy Britt Cool, one of Warren Buffett's key lieutenants in recent years, is leaving Berkshire Hathaway to create a mini Berkshire of her own.

Ms. Britt Cool joined Berkshire in 2009 at age 25 as Mr. Buffett's financial assistant, a job he created for her. In 2014, she became chief executive of Pampered Chef, a cookware company owned by Berkshire.

5) Here's my third strategy for winning the class participation game:

  1. Don't speak in the first half of class.

In general, the professor uses the first half of every class to establish the facts of the case, while the real analysis occurs near the end. Let your classmates make "chip shots" that merely demonstrate that they read the case, while you demonstrate sophisticated thinking during the meatier discussion in the second half of each class.

Best regards,

Whitney




About the Author

Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Prior to ValueWalk, Jacob was VP of Business Development at SumZero. Prior to SumZero, Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver