Published On: Mon, Feb 2nd, 2015

Bruce Berkowitz Gets Some Fannie


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Bruce Berkowitz got some more Fannie Mae, 1.8 million shares worth, and also loaded up on Freddie Mac to the tune of 3.1 million shares for his firm Fairholme Management, between August 31 and November 30, according to the Wall Street Journal. Bruce Berkowitz has been bullish on the companies and is one of the plaintiffs in the suit against the federal government over its bailout of Fannie and Freddie, which many investors thinks shortchanged them. Fairholme’s weighting in the combine stocks is 1.1%.

A judge threw out the lawsuit in October, and prices of Fannie and Freddie plunged. David Tepper expressed regret over ever having bought Fannie and Freddie, but Berkowitz and others have held on. He has been rewarded for his patience, at least for the time being, since in January a judge ruled that the lawsuit could continue, even as others have been thrown out.

Bruce Berkowitz also made bullish comments about AIG, his largest holding, in Fairholme’s annual report, as reported by Seeking Alpha, “We expect AIG’s property and casualty insurance business will be the main driver of further increases in value … if management is able to deliver underwriting margins and expense efficiencies consistent with its peer group, then the company’s book value and stock price will soon increase. We shall see.”

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