Paulson & Co., the $18 billion money manager run by subprime seer John Paulson, has been rumored to own GSE preferred shares. That would make sense, since Robert Lacoursiere, who worked for Paulson before leaving to start up his own fund in recent months, was a sell-side analyst who covered the GSEs. A spokesman for Paulson & Co. declined comment, and Lacoursiere didn't respond to an email query.

As for whether Fannie and Freddie privatization has a decent chance of happening and whether it needs to happen for preferred shares to be a good investment, views are all over the map.

Many politicians on both sides of the aisle want to sound as tough as possible on Fannie and Freddie, and Corker is certainly doing his best.

"These companies going private and them still having the implicit government guarantee is a non-starter. I don't see that having any traction at all right now. It certainly has no traction with me," Corker said in the interview last week.

That's one of the reasons Corker is taking a hard look at a plan published recently by the Bipartisan Policy Center, a think tank founded by four former Senate majority leaders including two Republicans and two Democrats. The BPC plan favors winding down the GSEs in the hope of replacing them with private mortgage insurers.

"We're spending a lot of time looking at the Bipartisan Policy proposal. It does have a government guarantee in it but we think there may be a way to take a kernel of that idea and do some things where eventually the market may figure out that there really just is no need for a government guarantee at all. But we're still noodling on that and we're still working with others," he said.

Competing proposals have been put forward by Jim Millstein, a former Treasury official who was in charge of the government's AIG ( AIG) investment and is now head of restructuring firm Millstein & Co.

Millstein, who served during the Obama Administration, has aligned himself with Phillip Swagel , who worked at Treasury during the Bush Administration. Swagel has put forward his own proposals which also involve returning Fannie and Freddie to the private markets. Millstein also owns Freddie and Fannie preferred shares, an investment he thinks may look even better if the GSEs are liquidated instead of being taken private.

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