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morning everybody uh happy new year um to most of you i haven't spoken to um we're still getting some people that are coming in here at the tail end and so as they enter the room i've got to mute them and admit them at the same time so if you see me a little distracted for a few minutes that's because everyone is there's still people coming in so i can see a few of your faces like gloria osteen give me a thumbs up if you can hear me okay can you hear me good all right well again happy new year um i wanted to [Music] take the time to give you an update on the letter agreements that the treasury issued on january 14th last thursday now that we've had a little bit of time to dissect them they're very complicated agreements and yet at the same time they're very simple and we're going to you know try and break them down and give you some perspective on what they mean at this point and how it's going to affect both the timeline of fannie and freddie recapitalization and release and at the same time um what it will do um you know to to the share price action which is you know what we're most important what what is most important to all of us so let me start out by talking about the litigation i'm going to go through the litigation i'm going to go through the capital requirements i'm going to go through the retention and i'm going to go through the government's interest in fannie and freddie following this letter agreement so the first thing i'm going to talk about is litigation on december 9th the supreme court heard oral argument in the collins case and there were two issues in that case the first was the constitutionality of the federal housing finance administrator the appointment and removal of that individual the supreme court um was very aggressive with that argument the government interestingly enough didn't through the justice department they didn't attempt to even defend the constitutionality of the federal housing finance administration the way it was set up and the key argument was the president didn't have the ability to remove that individual except for some very very significant reasons with cause as you've heard me say many times before the supreme court or the government through the legislature has always attempted to create this fourth rail of government we were set up with a balance of power structure the legislative the judicial and then the executive branch of government and congress has always attempted one way or another to try and rule from the grave or set up rules set up agencies set up regulations that can't be changed going off into the future and that is a constitutional issue that's exactly what was addressed because the executive branch of government should have had the ability to remove the executive director of the federal housing finance administration for cause for any reason at any time and they attempted to tie his hands in the way the housing and economic recovery act was structured the second issue in front of the court was the administrative procedures act did the government violate the administrative procedures act as the same as being the single creditor of fannie and freddie in cahoots with the federal housing finance administration did they violate the apa when they directed 100 of the earnings and profits of the corporations to the government in perpetuity that was the most important issue from our standpoint because we believe that the government is going to lose on the constitutionality claim prospectively going forward we believe the president will have a removal authority of the federal housing finance administrator the issue is the the most important issue in front of the court was did they violate their authority did they exceed their authority by taking 100 of the earnings and profits of the corporation well i listened to the oral argument and i have to admit a few people here hold on welcome to the four people that just came in um we're just talking about the litigation right now and i was just about to start with the administrative procedures act and in the legality of the government taking 100 of the earnings and profits of the corporation of fannie and freddie and the impact that that would have and not to my surprise but david thompson did a brilliant job and the court was concerned very concerned and in the most liberal and the most conservative members of the court weighed in on this justice breyer who we'd all agree is one of the more liberal members of the court he used the words nationalization three times justice sotomayor had the same concerns there was much discussion about that and in the um unenviable position of anyone that's ever appearing before the united states supreme court governments for the lawyers or the lawyers for the government under the apa claim had to answer a series of questions by judge gorsuch and it was in sequence well your honor we agree with disagree with you on this point but and we disagree with you on this point we disagree with you on this point however if all of that is true yes we will lose this case and and so that's a that's a terrible position to be in um for those of us that of us that have followed this closely um it was a bad showing for the government it was a great showing for david thompson in fact i spoke to him before i did the appearance on fox news with maria barto-roma on december 22nd and he was still in hawaii recovering you know it's a very very stressful thing to appear before the united states supreme court take on the government no less but he was very very confident about the position that they were in with the apa claims so that is a it was a big factor in in all of this subsequent to that on december 15th in the lamberth case and the lambert case is in the dc circuit and judge lamberth if you recall in september of 2014 he dismissed the litigation against the government based upon the government's representation that fannie and freddie were in a death spiral that they were hopelessly bankrupt and because of that taking 100 of the earnings and profits of the corporation was profit was was proper well and they did it on the basis of an affidavit by the net by the an individual at treasury his name was mario eugletti nobody seems to see much of mario eugletti these days because as we know now that was a false affidavit it was a materially false statement call it perjury call it fraud on the part of the government but it was false and that was the basis upon which judge lambert dismissed that case and judge lamberth is a very respected jurist he's very respected in all of his um you know by his peers and as a result many of these cases were dismissed in a domino effect based upon his ruling in that case well in the u.s court of claims where the government has jurisdiction over admitting people here where the government has jurisdiction over takings under the constitution judge sweeney allowed for a limited amount of discovery it was an error on the part of the government that allowed her to order some discovery and during that discovery we learned through the deposition of the chief financial officer of fannie mae at the time susan mcfarland that she had just briefed the government not only were they not bankrupt but they were entering a huge age of profitability they had solved their problems the financial crisis was over and they were going to have to write up billions of dollars of assets that they had written down and in addition to her testimony um the government had an outside auditor grant thornton they were present and they memorialized everything that susan mcfarlane said to the treasury on their work documents and those work documents were part of the discovery as well so without question the government entered into an agreement to take a hundred percent of the earnings and profits of the corporation in violation of hera and contrary to what they had represented to a federal judge they lied to a federal judge and i want you all to understand that the significance of that lying to a federal judge because in my conversations with david thompson who is also the lead attorney on that case and anyone that has ever practiced law at a certain point in time the trial record has to be certified before it goes goes forward who is going to certify a false statement that has been made to a federal judge prior to a trial and prior to an assessment of damages and that's where both collins is on a remand for damages if the supreme court upholds the fifth circuit and that's where we are right now in the lambreth case in the 8th circuit where we're headed towards trial so on december 15th there were 9 800 documents 56 000 pages of information that the treasury turned over as part of the discovery they objected to having to turn over that information judge lamberth ruled against them and unlike previous cases where they attempted to appeal the ruling on a motion to compel on either an interlocutory appeal or a motion to reconsider the government just said okay and they turned them over and they turned over and it was very similar to what they did in collins where they didn't even question and show up to to to argue the constitutionality of the appointment of the federal housing finance administrator in fact the supreme court hired an amicus lawyer you know a friend of the court to argue the position that the government would not argue on behalf of themselves so you can see this litigation is far more serious than what we thought up to this point and sometimes your success could be a hindrance and when i close out with my remarks today i want you to to remember that because i think the litigation has worked in our favor um and when i conclude you'll see why as i put together the different pieces of this one of the things that is permeates the letter agreement and i'm putting all of this up on the website so you can read the letter agreements for both fannie mae and freddie mac you can read the fifth circuit you can get you can go back and listen to these oral arguments that i'm telling you about but but one of the things that that rings through these letter agreements is that as part of the recapitalization and release and the exit of conservatorship of fannie and freddie these lawsuits have to be settled well i remember i've been in this long enough to remember when howard kane at arnold and porter mocked the shareholders for the litigation that they brought and said that they had no standing to bring the litigation and we've been to the supreme court we've discovered that there's fraud on the part of the government i actually stood in front of the the a federal judge in delaware as a plaintiff on the the uh the issue of whether or not we had access to the books and records and that judge denied it and i remember looking at howard kane and the the eight lawyers that they had you know at the the government's table and i thought to myself this truly is david and goliath bringing this fight to the federal government so but we'll we'll close out with that the next section that i want to talk about that's in this letter agreement that you can go back and read is that this whole issue the capital requirements and why is that important what does that mean well the capital that a financial institution has is the buffer between what is lost and ultimately what happens if the federal government has to come in and bail out a financial institution and that has been something that we have redefined since 2008 with the end of the financial crisis all financial institutions have to have more capital they have to demonstrate that they have more capital on an annual basis before a bank like bank of america or jp morgan or citigroup before they can increase the dividend before they can do a share buyback they have to get the blessing of the federal reserve on an annual basis where they prove out that they have adequate capital to meet a stress test with the stress test is essentially a simulation of what happens if we end up in another financial crisis and how much capital they have in reserves before they become insolvent so the capital requirements of fannie and freddie have gone through two years of intense scrutiny and formulation by mark calabria who is the head of the federal housing finance administrator administration mark calabria and michael creminger wrote hera when creminger was general counsel for the fdic and calabria was chief of staff for senator shelby when senator shelby was chairman of the banking committee so there's no one more qualified to do that than mark calabria and mark calabria put a very very high bar on the capital requirements he wanted bank like capital four percent capital ratio which is essentially the same capital ratio that jp morgan and the rest of them have to have that was a source of much much controversy you know can they generate a return on equity can they attract shareholders is it really necessary to have the same amount of capital for fannie mae and freddie mac as jp morgan or citibank or bank of america after all they only do one thing they securitize mortgages and they have a unique business model that's different than the rest of them but that being said that's where the capital rule ended up at four percent and there was a lot of chatter about whether or not they would be able to attract capital and be successful exiting conservatorship one of the things they did in this letter ruling was they reduced the capital requirement to three percent from four percent based upon their ability to exit conservatorship and what they've allowed what they are allowing them to do is to exit conservatorship with far less capital 25 less capital over 25 percent less capital and they'll allow them to build to that four percent based upon retained earnings at the same time they pay out dividends well that's a very sensible approach and remember this is a new factor that i'll enter into this jp morgan and morgan stanley are the financial advisors they are helping them raise capital to exit conservatorship and so the treasury acknowledged that yes it will help us exit conservatorship faster if we um don't have to raise as much capital it is less dilutive retained earnings does not dilute shareholders new capital dilute shareholders so the fact that they have to raise significantly less capital to exit conservatorship was a very very positive development no one you know thought about the next thing that i want to recover or what i want to cover has to do with capital retention and in this letter agreement they have made a change they have said that 100 of the earnings and profits of fannie mae and freddie mac will be retained by the entities that's amazing because that it wasn't until september of 19 that they were even allowed to retain capital now they and they put a threshold on it they were bumping up against that threshold now they get to retain 100 of their capital there's a catch to it the catch to it is it shows as an asset on their liability on their balance sheet but there's an offsetting liability and this is the liquidation preference so every dollar a capital that they retain they have a lot of adding somebody here every dollar capital that they retain they have to add uh a dollar that they owe the government now that sounds really kind of screwy until you analyze and you go beneath the surface and you try to understand treasury's position for that and here's the analogy that i'll give you that i think everybody can kind of understand everybody has sold a home before or known somebody that sold a home and if there's a mortgage on that home and you have a buyer and a seller and the buyer says i want to take possession of that home and the seller says fine and they allow the buyer into the home but the buyer hasn't paid for the home yet does the seller release the mortgage on that home at the same time they give them possession of the home and the ownership of the home no they don't and so what has to happen and we will close with this what has to happen is simultaneously as there's an agreement that ends the litigation and there's agreement on the capital and the capital structure and how it's going to be priced that liquidation preference will be written down based upon the retained earnings and the courts jumping back for a minute the courts are going to write down that litigation preference because if they rule that fannie mae and freddie mac were unjustly burdened by the third amendment sweep then the money's paid back and the government actually owes those entities some some additional funds so we'll go forward now and i want to you know bring this um to the next point which is the government's ownership stake so in addition to advancing money to fannie and freddie at 10 interest that now stands still stands at approximately 192 billion dollars the government can exercise warrants equal to 79.6 of the outstanding common stock those warrants as part of an agreement for recapitalization and release they have to be exercised so they can't sit back and allow those warrants just to fester they have to be negotiated into recapitalization and release and so what that does is whatever the government's interest is as of recapitalization and release it will be front and center and everyone will understand what it is um so you've got four elements of this agreement that are [Music] all geared towards recapitalization and release and the exit of conservatorship and when you go to the website and you look at these letter agreements and you look at section 9 and section 9 is the last section of this very very complicated agreement and i'm just going to read it to you the the heading on this section 9 in boldface is this commitment to develop a proposal to resolve conservatorship so the treasury is saying that they are committed to um they're committed they're absolutely committed to exiting conservatorship and then let me read you what is underneath that it says in order to ensure a path for treasury to resolve its investment in the enterprise in a manner that fairly compensates taxpayers for the support that they have provided and continue to provide treasury in consultation with the agency have begun to work to establish a timeline and process to terminate the conservatorship and raise capital including identifying any necessary legislation for reform of the enterprise and an analysis of the appropriate number of guaranteed guarantors including whether there should be one or multiple guarantors in order to facilitate the exit from conservatorship treasury and the enterprise commit to work to restructure treasury's investment and dividend amount in a manner in a manner that facilitates the orderly exit from conservatorship ensures treasury is appropriately compensated and permits the enterprise to raise third party capital and make distributions as appropriate treasury in consultation with the agency should endeavor to transmit a proposal that details this work to both houses of congress on or before september 30th 2021. so we have less than a nine-month window where the treasury in this letter agreement is fully committed to having visibility for a plan that will allow these entities to raise capital and exit conservatorship um now there's as you can imagine there's a lot of chatter um in the background about all of this and washington dc is not a place where secrets are kept very well um and a lot of people pay a lot of money to get as close to people as they can to get those secrets and then those secrets get kind of disseminated and they get twisted around it's like that game that we used to play as a kid you know where you'd write out a paragraph on how to build the box the first person would read it and then they would turn to the second person and they would tell them what the instructions were to read the box to build the box and by the time those instructions had been passed to 20 people and the last person in the chain recited the instructions on how to build the box how close to what the 20th person said was it to the first person and the actual instructions that were given a lot of it gets messed up in translation and that's one of the things i think that has happened here you know they if we look at what has happened and i look at my interaction i've always felt like with this issue and the people that have been involved with this issue i have always felt like the litigation was going to be the driving force in this and on my part it was a little naive to think that anybody including mnuchin would take on the tough political of saying that the government has been paid back in fact after this agreement this will show you how washington works after this agreement was written maxine waters and it was released after the market about five o'clock on thursday january 14. about 10 30 or 11 o'clock maxine waters who's head of the senate bank or the house banking committee finance committee she released a statement criticizing the letters from the letter agreements as benefiting exclusively benefiting a group of hedge funds and unduly benefiting the shareholders um and it was it was kind of a vicious letter and then sherrod brown who's on the senate banking committee did the same thing well they hadn't even read the letter agreement they don't understand the issue i am very very confident of that because i've been before both of them um and and so you have this confusion that was created by all of that when i said it was naive on my part it was naive on my part to think that anybody would have the courage to just come forward and say we messed up and we've been paid back that message has been communicated to treasury secretary yellen and what i discounted as as excited as i was about the success of david thompson and the release of this information in the litigation as excited as i was about that i failed to consider the position that the government was in they now have to protect the taxpayers and they've been unburdened of doing of taking on the tough political challenge of saying this money's been paid back because the court's going to do it for them and they know they're going to lose and that's why for the first time in these two letter agreements they made as a condition that all the litigation be settled except for one piece of litigation that is a direct claim against the government and it cannot exceed four five billion dollars and it's ironic i'm very familiar with that piece of litigation it challenges the actual conservatorship itself and the claim there is four and a half billion dollars so the government for the first time has actually considered that in fact if you go back to the late fall of 2019 porter has handled this litigation and they've been billing the government over 20 million dollars a year and i know that didn't sit well with the current director the federal housing finance administration it didn't sit well with treasury they went outside and they hired they got a request for proposal they hired a law firm by the name of milbank huge firm and milbank actually acted as a as an independent legal advisor to the treasury to help them evaluate their position in the litigation because they were losing they had just lost in the fifth circuit and on bach hearing in the fifth circuit and they were headed to the supreme court and the united states supreme court is very unlikely to overturn and on by kyrie of a prior court all they would do more than likely is clarify that and so they even hired an independent outside advisor and so how did all of that get into that agreement they're concerned about the litigation they understand that it would be very difficult to turn this back to the companies have them raise money and settle the litigation at the same time so they've added that as another condition but as i've told you and i just read it you know it's right here it is number nine on both of the letter agreements the language is exactly the same the government is committed to having these entities exit conservatorship so that becomes a question the question then becomes what are we going to get what is the value of our shares what is it going to be and that depends on a number of things as i've told you the most secure position to be in is to be a preferred shareholder the preferreds have either a 25 or a 50 par value because of the litigation in judge lambert's court we have tremendous leverage on a damaged model that david thompson publicly in a press conference i did with him in january february time frame of 2019 he said it's 12 a share and rising based upon post-judgment interest and the trial in judge lambert's court is focuses singularly on the issue of the contract rights of preferred shareholders so as we go through as they go through these negotiations the preferred shareholders have tremendous leverage in how this big piece of pie is going to be split up and there will be a negotiation between the shareholders that have a vested interest in this and the shareholders that are providing new capital well one of the interesting things about the capital structure and who owns what at this point is the number of existing shareholders that will be the source of additional capital and i'll give the example of two all of this is public information under the investment company act of 1940 every shareholder has to release their holdings and what they've bought and what they've sold on a quarterly basis so when you look at the number of different preferred issues and there's dozens of them we own maybe eight or nine you can see who the largest shareholder is under the large under the investment company act of 1940. well two of the largest shareholders are the nation's largest pension fund tiaa-cref and capital research and management which manages the american funds that that's the parent company that manages the american funds they were original shareholders of fannie mae and freddie mac no one understands this issue better than them um and so it becomes very difficult for them to be a source of new capital if they're not being treated well on their existing shares so i think that there's going to be a lot of demand i i don't worry at all about whether or not they'll be able to raise the money in the current environment that we're in there is a need for companies with real earnings and real profits you'll see in my year-end letter that's going out today um that you know we poke a lot of holes in what is going on right now it is very reminiscent of 2000 it's a time to be focused on value and i'll close with two things first um you know following a financial crisis of 2008 and we recovered very very well um but i didn't like the drawdown i didn't like the fact that we got hit and and i i've spent a little bit of time and every waking day thinking about how do i protect you how do i protect myself from that point in time where all of a sudden everybody realizes that tesla is so overvalued that it's going to crash how do i protect you against the inevitability of what happens in a bubble like february of 2000 when nasdaq lost 82 percent of its value over the next 10 years how do i communicate to you that with any company no matter how much you like it the valuation of that company is the most important single factor in your long-term success and what your entry point is in that valuation you still don't believe me even though i tell you snap-on tools has performed better than microsoft in the last 20 years and i can give you examples of a lot of companies it's still hard to believe that warren buffett despite the fact that he generated a two percent return for shareholders of berkshire hathaway in a 16 market last year that he has done significantly better than the s p 500 his entire career and in the last 20 years it's hard to communicate that but that is the challenge and so as we look at that i'm trying to find ways of creating non-correlating assets meaning when the market goes down we've got things that are going to go up i addressed that without even knowing what i was doing essentially in 2000 when i owned genesco and i remember taking the heat over that but i thought it was a great company with great earnings with upside and when genesco went from two to fifty dollars while microsoft went down and all the other tech stocks went down like sun microsystems losing 98 of its value that created the opportunity for success because we had something we could sell that was going up that we could reinvest into things that were going down it is that simple and so fannie mae and freddie mac they have become that non-correlating asset and about the time that we get this settled we will have an asset that will be going up i believe at the same time other things that are going down um and that will help protect us and during a period like this you take a lot of heat for it because as i said in my hearing letter it's real easy to watch it's very difficult to watch your neighbors get rich and whether or not that's real wealth or not time will tell and so finally i want to read something to you i got this from a credit analyst that does a lot of trading um for a large company and he sees who's buying and who's selling um and and he he wrote down some bullet points that i think are very appropriate when we look at fannie and freddie he said number one you're looking at pricing as security of a company in reorganization well inherently that creates uncertainty and so despite the fact that these have par value of 25 and 50 dollars they're going to trade based upon that uncertainty until you move towards more and more certainty the security is very liquid with both institutional and retail following in other words for one reason another people will enter and exit a security and there is liquidity for that but the rewards are going to come at the point in time where the uncertainty the reorganization everything is settled um the security is a hundred percent covered from a value standpoint the value of the entity is well in excess of our claim on the capital structure with the preferred securities there are 33 billion dollars at face value that's a rounding error in organizations that have six trillion dollars worth of assets and 35 to 45 billion dollars of annual pre-tax profits when run properly the next one the u.s government has an option to purchase 80 percent of the entity for one dollar that's not going to impact the value of our shares it's not unless it impacts common it does not impact preferred the pedigree of smart money invested in the security is like best of show in westminster tia cref capital group some of the smartest hedge fund managers in the world in others the entity itself is necessary for national economic health we have to have a strong housing market you know and as i told maria barto-roma on december 22nd know fannie mae and subsequently freddie mac years ago they were so the solutions to help the george baileys of the world fight off the mr potters in the building and loans in the movie it's a wonderful life these businesses are not impacted by technological obsolescence they don't have heavy research and development expense once they are they exit conservatorship they essentially are fully capitalized and the only capital retention requirements that they will have for the ordinary course of obsolescence in the business just like any business technology furniture people and they'll retain capital to get to that four percent capital allocation the entity provides a service to rich and poor alike but it's more but is more important to the less wealthy in other words the success of these entities go more towards moderate income in in middle america and others the as i told maria the largest loan that you can get on fannie five hundred and twelve thousand dollars the average loan is less than half of that and there are people that are routinely paying a hundred thousand dollars for a car now that will be technologically obsolete and will be headed to the rust pile in six or seven years the business is easy to understand and should be easy to value by institutional investors once these roadblocks once the treasury complies with their stated intent in as they move forward in section 9 of the agreement the entity has one of the most powerful and sophisticated financial advisors assisting them in its effort to raise capital that is jp morgan and morgan stanley and as i joke many times they get a performance fee they don't get paid until they are successful the big payoff is based upon their success and those of you that have ever been out riding horses on vacation or whatever and you hop on a trail horse you know you get towards the end of that ride and those horses you've heard the expression jp morgan and morgan stanley are going to be like trail horses headed to the barn because that's when they get fed that's when they get my big butt off of them and they get water and they have to live until you know they get freedom until the next time somebody doesn't know what they're doing climbs on top of them and then finally this has drug on for over 12 years and it's time for it to end they've established a time frame for it to end and it is coincidental that it's going to happen as this litigation comes to an end so for all those reasons you know i'm continuing to recommend that we hold i think you know one of the terrible things that treasury did um in all of this is that they released this information on thursday night after the close of the market and the expectations that we all had had were that they were going to write down the liquidation preference and that this would be settled and as i look back on it now that's part of what i mean but it was naive the strength of litigation had far more impact on this issue than anything and there's continuity this will be janet yellen's job to finish um and it will be done in a very very orderly manner the time frame actually really hasn't changed because even if secretary mnuchin had done what everybody expected him to do we'd still be looking at nine months to 12 months and you'd still have uncertainty about how it it will you know was going to play out um one of the more interesting things in this journey that i've had and being involved with this issue is that i sit on the committee for a responsible federal budget and if any of you saw the confirmation hearings yesterday with janet yellen um they were kind of they didn't challenge her a whole lot about the budget deficit and the tremendous debt that we're building up um and but they reminded her that she was a director of the committee for a responsible federal budget and what was she going to do about it and she said well now is not the time to do it interest expense because rates are low the interest expense on the budget is the same as it was in 2008 and we've got to get through this crisis first but as part of her being a board member and me being a member we had an end we have an annual meeting and in september of 2019 at our annual meeting in the cocktail reception before the formal part of the program started um we were standing out on the the top of this rooftop garden where the event was being held everybody was you know having a glass of wine or whatever and there she was and somebody had just said thank you and walked away i walked up and got right in front of her and i can tell you she came up to about my belly button and i'm not that tall and i sat there and and talked to her and after the initial pleasantry she asked me what i did for a living i explained that to her i asked her about fannie mae and freddie mac i told her that i had shareholders just like you and asked her you know what her thoughts were about it and i think in that conversation you know it was very revealing she said i'm not as familiar with the litigation as you are but my concern has always been the periodic commitment fee that the government gets for backing these entities and the periodic commitment fee is what's the government paid to have to act as a backstop in the event that fannie and freddie failed as was alleged in 2008 the basis of the conservatorship and that takes on two that's a two-part answer to that question the first is the amount of capital that they have in front of the entities and so that's what director calabria has put in place in the financial services oversight committee of which the the treasury secretary and the head of the federal reserve are both members they endorsed the need for capital they endorsed bank like capital they endorsed the plan that treasury secretary calabria or the fufa director calabria and treasury secretary mnuchin calibrated and put in front of them back in november they got their buy-in form for it and so the answer to now treasury secretary yellen's question and the answer that she gave me in september of 2019 it's been answered and there should be no further objections to getting these entities recapitalized and released within the nine-month time frame and then we'll have a whole different set of questions and in meetings about how we diversify the proceeds from this long-standing investment that we've had so that concludes the presentation that i have um it's too we've got a lot of people on this call so it's almost impossible to take questions if you have specific questions send them to us i'll put them up on the website please use the information that we've got on the website you know everybody can have an opinion there can only be one set of facts daniel patrick monahan said that the first time in 1986 before he started negotiations on the future of social security and i want to deal with the facts i'll never react to emotion when it comes to making investments and when it comes to reacting to investments and i'll take the heat and i'm taking a little of the heat right now but we will prevail and that is probably the best sign that we're going to be successful in this so thank you happy new year and i look forward to being able to deliver a lot of positive news throughout the year on this issue you