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Fannie, Freddie Bull Ackman Steers Clear of D.C. Fight

Stocks in this article: FNMA FMCC

Updated throughout from 6:30 a.m., with additional analysis added on page 2.

NEW YORK ( TheStreet) -- Bill Ackman demonstrated with his short bet against Herbalife  (HLF) that he isn't afraid to enlist politicians to his cause, but the Pershing Square Capital Management boss had been keeping pretty quiet about his stake in government sponsored enterprises Fannie Mae (FNMA)and Freddie Mac (FMCC).

Ackman broke his relative silence May 5, with a 110 slide presentation at the Ira Sohn investor conference, but don't expect the hedge fund manager to begin the kind of vocal campaign he has pursued with Herbalife, says a person familiar with Ackman's thinking.

Ackman took a bit of a bruising in the press in March, when The New York Times depicted the hedge fund manager as the puppetmaster behind government investigations of Herbalife. Since Ackman unveiled his short position on Dec. 20, 2012, he has faced considerable pushback from the company, as well as from investors who have taken the other side of his bet, most notably Carl Icahn.

When it comes to Fannie and Freddie, however, the obvious role for Ackman to play would be to make policy proposals, as Fairholme Funds has done publicly and The Blackstone Group  (BX) said it has done privately.

Ackman plans to let discussions over the future of Fannie and Freddie to play out on their own, however, as his camp believes Washington has absolutely zero interest in hearing policy recommendations from hedge funds.

And Ackman isn't good at hiding. Though he has had far less to say about Fannie and Freddie than Fairholme Funds chief Bruce Berkowitz, the May 5 slide show was enough to win him top billing in the "plot to use Fannie Mae and Freddie Mac to steal billions from the taxpayer," as the website Vox put it on Monday.

The slide show may have been modest by comparison with Berkowitz's proposal that the government sell him Fannie and Freddie's mortgage backed securities insurance businesses, but that is only in comparison. Its 110 pages and $23-47 per share target price (compared to Tuesday afternoon's trading levels of $4.31 per share) are characteristically audacious. For comparison, Rafferty Capital Markets' Dick Bove has a $9 price target on Fannie and KBW analyst Bose George sees shares of both GSEs as worth $2.

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