"Big tax-related assets could be brought back" $FNMA #FANNIEGATE 2011 marketwatch

LAS VEGAS (MarketWatch) -- Kyle Bass, head of hedge fund firm Hayman Capital, said Thursday that he's betting on the preferred stock of government-owned mortgage giants Fannie Mae FNMA, +0.97% and Freddie Mac FMCC, +0.80% The securities "could be an 8 to 10 bagger from here," he added at the SkyBridge Alternatives Conference in Las Vegas. Bass, who has been a critic of Fannie and Freddie, said the companies are currently making money before interest payments on 10% debt they owe the U.S. government. Big tax-related assets could be brought back onto their balance sheets and the fee they charge for guaranteeing mortgages should be increased from 20 basis points to 60 basis point over several years, he added. This means the preferred shares are potentially worth a lot more, he explained. "The preferreds still trade at 8 cents on the dollar, it's crazy," Bass said.

http://www.marketwatch.com/story/bass-bets-on-fannie-freddie-preferred-shares-2011-05-12