Fannie and Freddie Shares Plunge on Supreme Court Ruling

The Supreme Court ruled that the government is not required to share profits from Fannie Mae and Freddie Mac, impacting hedge funds and investors. Fannie Mae and Freddie Mac have been under government conservatorship since 2008, paying dividends to the Treasury. Legal challenges by hedge funds were rejected, and the market reacted with significant stock declines.

What was the Supreme Court's decision regarding Fannie Mae holders?

• Fannie Mae holders are entitled to additional dividends.

• The government must share financial gains with Fannie Mae holders.

• The government is not required to share financial gains with Fannie Mae holders.

• The Supreme Court did not make a decision.

What was one of the grounds for the hedge funds' lawsuit?

• The dividends were too high.

• The FHFA was not properly established.

• The 2012 amendment lacked authority.

• The government should not control Fannie Mae.

What did the Supreme Court decide about the FHFA head's dismissal conditions?

• The conditions were unconstitutional.

• The conditions were sent back to a lower court.

• The conditions were irrelevant.

• The conditions were upheld.

How did the market react to the Supreme Court's decision?

• Common shares increased by 35%.

• Preferred stocks increased by 65%.

• Preferred stocks remained stable.

• Common shares dropped by 35%.

Which group was particularly affected by the Supreme Court's decision?

• Common stockholders

• Preferred stockholders

• Government officials

• Supreme Court justices