The delusion of Fanny and Freddie releases again emerged
An investor who was convinced that the Trump administration had decided to release Fanny and Freddie Mac from government management, or the investor who had been believed from the wealthy hedge fund manager is probably a painful surprise. Will be hit by.
Yesterday's Brightbart Business Digest discussed the history of investors' efforts to earn shelves through Fanny and Freddie's ordinary shares and quasi -priority shares.
Now that President Trump has returned to the White House, investors are betting on the two companies and return to the management of shareholders. And they Violent lobby activities to Trump administration officialsDirectly and indirectly, they will be released. Unlike this time, the conviction that Fanny and Freddie will be released have soared their stock prices.
But the most likely result is The two companies stay in the guardian system during the term of President Trump。 There is no aggressive plan within the Trump administration. President Trump theoretically supports the release, but stakeholders who are familiar with the president's ideas have not hoped that Trump will invest any political funds to realize the release. Due to the priority of issues such as trade, immigration, energy, taxes, DEI and ESG duty, and inflation suppression, there will be little time to open a new state in GSE policy.
Scott BessentPresident Trump, chosen as the Secretary of the Finance, has little interest in this issue. This was not covered by recent approval hearing held by the Senate Finance Committee. In a document answer submitted to the Senator, Bessent said that the guardian's job should not be indefinite, but avoided what would happen next. According to what was reported, Bessent said at a meeting with the Senator that it was difficult to deal with Fanny and Freddie. Not a priority。 According to several stakeholders who are familiar with his way of thinking, Bessent is cautious about the act of destroying the mortgage market as an experienced person in the global financial market.
In 2008, the regulatory law of the Housing and Economic Reconstruction Law may not allow the government to provide unilateral privatization. The text is paid to The only way to get out of the guardian system, the trustee system。 This is in line with what happens when a bank broke down, and cannot be solved immediately by bank authorities. They are placed in the bridge guardian system, wiped out shareholders, sold assets and business content, and eventually operate for a certain period of time until they enter the dissolution trustee system. As a conservative, there is a possibility that privatization may be possible with a wide range of discretion given to FHFA, but it is not legally certain.
The major challenge in trying to turn Fanny and Freddie into a normal company without receiving government support is how to realize it. Avoid re -creation of tacit guarantees Without impairing the ability to provide stability and liquidity in the mortgage market. This is not a simple job, and many market participants are skeptical if they can achieve it in the first place. Rather, in order to reduce the role of the mortgage market in the mortgage market, it is necessary to fundamentally reconsider the mortgage bond guarantee method by completely eliminating Fanny and Freddie and replacing them with completely new ones.
“Certainly, given that GSE plays a central role in the housing financial system, it takes some effort to convince the market that if GSE's explicit support is exhausted, it will not be rescued. However, even if the administration is successful, it is difficult to understand how the GSE model works. Recent Jim Parot and Mark Zandy I insisted in the dissertation For urban research institute。
The most likely road for the Trump administration is Make the parliamentarians take the initiative Planning to withdraw from Fanny and Freddie, or to create a new structure of the entire second mortgage market. However, the fact that there was no question about this at Bessent's hearing was a sign that the members of the Diet did not consider this as an imminent problem. In addition, we will satisfy both liberal housing prices that are considered to be Fanny and Freddie as a means of expanding housing ownership of Americans, and conservatives who want to decide the future of the mortgage market by market processes. It is unclear whether you can.
Scott Bessent, the Secretary of Finance, will testify on January 16, 2025 at an approval hearing of the Senate Finance Committee. (TOM WILLIAMS/CQ-ROLL CALL, Inc, Getty Images)
In addition, there is a problem whether a company is privatized, whether the holder of ordinary stocks and priority shares remains value. The following rights are given by government priority shares. $ 300 billion in liquidation And we have almost 80 % of ordinary shares. To build enough capital cushions in the short term, it is necessary to sell additional shares to investors, and the current shares may be further reduced.
President Trump will not give a big gift
Recent plans Suggested by Bill AckmanThe billionaire investors who have accumulated a huge position in Fanny's ordinary stocks are probably beginners. He will effectively delete $ 300 billion of priority to the government Simply swiping a pen will actually give you a gift to shareholders. Government lawyers have claimed to senior officials that such measures are likely to be illegal. It is clearly non -trump. Trump said in 2021 in a letter to Senator Land Paul (Republican Party, Kentucky) that he would sell government shares with “gaining enormous profits.” It is inconsistent with donating the value of a taxpayer of hundreds of billions of dollars.
If you adopt something like Ackman's plan and put a hedge fund manager wealth, it will be extremely large, leading to the criticism that the Trump administration is functioning for the benefit of Soupai. 。 It will probably hurt the president's qualification as a populist. There is a high possibility that mortgage costs will increase due to privatization Companies have passed the rise in borrowing costs and the rise in capital fees to housing buyers, but they do not want the Trump administration to promise inflation control.
Probably more important is There are almost no economic or political good materials for Trump To privatize Fanny and Freddie. While the investor is profitable, Trump will take political risks and the risk of turning the mortgage market.
It is unlikely that the Trump administration will try to break Fanny and Freddy Macs from a private company to break away from the guardianship system. surely, That was not expected for the first two years after the establishment of the administrationFocus on the problem that Trump received the mission of the election. If investors recognize this reality, it is likely that many of the rising 420 % of ordinary shares after the voting date will disappear.
