FMT:
Trump orders his ‘representatives’ to buy US$200 billion in mortgage bonds
The US president’s plan to buy US$200 billion in mortgage bonds could boost the economy, similar to the Federal Reserve’s pandemic-era quantitative easing program
It was unclear what funds US President Donald Trump meant when he said the two government-backed mortgage firms held US$200 billion in cash. (EPA Images pic)
WASHINGTON: US President Donald Trump said on Thursday that he is ordering his representatives to buy US$200 billion in mortgage bonds to bring down housing costs, though he provided no specifics.
“Because I chose not to sell Fannie Mae and Freddie Mac in my First Term … it is now worth many times that amount — AN ABSOLUTE FORTUNE — and has US$200 BILLION DOLLARS IN CASH,” Trump wrote in a post on Truth Social.
“I am instructing my Representatives to BUY US$200 BILLION DOLLARS IN MORTGAGE BONDS. This will drive Mortgage Rates DOWN, monthly payments DOWN, and make the cost of owning a home more affordable,” Trump wrote.
Federal Housing Finance Agency Director Bill Pulte said on X that Fannie Mae and Freddie Mac will execute the purchase.
It was not immediately clear what funds Trump was referring to when he said the two government-owned mortgage finance companies had US$200 billion in cash. The combined cash and cash equivalents listed on the two firms’ balance sheets in their third-quarter earnings reports to the Securities and Exchange Commission was less than US$17 billion as of Sept 30.
The White House did not immediately respond to requests for more information on Trump’s statement.
Affordability of everything from groceries to homes has become a hot political issue even as Trump has occasionally dismissed affordability concerns and blamed inflation on his Democratic predecessor.
His public approval has mostly sagged since his inauguration as Americans worry about the economy.
Trump’s call to purchase US$200 billion in mortgage bonds could provide stimulus to the economy akin to what the Federal Reserve did when it also bought those same types of bonds during the pandemic and its aftermath, as part of an effort called quantitative easing.
But in the Fed’s case, it used money it created as the US central bank to fund the purchases. No other entity would have the same ability, which could mean tapping resources that might go to another use.
Trump has pressed the Fed to cut interest rates aggressively and his policy, if implemented, would likely provide some of the lift he’s been seeking.
“Because I chose not to sell Fannie Mae and Freddie Mac in my First Term … it is now worth many times that amount — AN ABSOLUTE FORTUNE — and has US$200 BILLION DOLLARS IN CASH,” Trump wrote in a post on Truth Social.
“I am instructing my Representatives to BUY US$200 BILLION DOLLARS IN MORTGAGE BONDS. This will drive Mortgage Rates DOWN, monthly payments DOWN, and make the cost of owning a home more affordable,” Trump wrote.
Federal Housing Finance Agency Director Bill Pulte said on X that Fannie Mae and Freddie Mac will execute the purchase.
It was not immediately clear what funds Trump was referring to when he said the two government-owned mortgage finance companies had US$200 billion in cash. The combined cash and cash equivalents listed on the two firms’ balance sheets in their third-quarter earnings reports to the Securities and Exchange Commission was less than US$17 billion as of Sept 30.
The White House did not immediately respond to requests for more information on Trump’s statement.
Affordability of everything from groceries to homes has become a hot political issue even as Trump has occasionally dismissed affordability concerns and blamed inflation on his Democratic predecessor.
His public approval has mostly sagged since his inauguration as Americans worry about the economy.
Trump’s call to purchase US$200 billion in mortgage bonds could provide stimulus to the economy akin to what the Federal Reserve did when it also bought those same types of bonds during the pandemic and its aftermath, as part of an effort called quantitative easing.
But in the Fed’s case, it used money it created as the US central bank to fund the purchases. No other entity would have the same ability, which could mean tapping resources that might go to another use.
Trump has pressed the Fed to cut interest rates aggressively and his policy, if implemented, would likely provide some of the lift he’s been seeking.
***
Fannie Mae and Freddie Mac was worth less than US$17 billion as of Sept 30 yet he claimed it is worth US$200 billion - one mighty snake oil salesman
He did said, back in the first term, that he is a wartime president. Fifth generation warfare is pretty much the name of the game now...so, the affordable housing is a serious issue. One other name not mentioned is Bill Gates, he also own a lot of farming land.
ReplyDeleteThe opinion here is still an opinion, but the sentiment of big corporation sapu-ing everything is pretty real. I do wonder if there is similarity in Klang Valley, Penang and JB. Ours maybe develop and develop with overhand, unaffordable and see if developers will blink of laughing all the way to new property in London, Paris, New York...just saying.
And Obama did boast he had a "magic wand" and Donny did not but Donny did waved the "magic wand" with respect to some financial or economic event back in 1.0
https://x.com/i/status/2009609500815474948
Great analysis from a friend:
I am guessing a Black Swan Event is about to happen. I think the supreme court is going to come back with a ruling saying that the tariffs are illegal possibly.
This will be the trigger.
Because if this happens it means the US will have to give back $600B. This will decimate our economy.
Simultaneously Trump just announced that he is passing an EO and wants legislation passed to prevent corporations coming in an buying homes.
Blackrock has bought over a million homes over asking here in the US inflating the housing market.
I think the ruling from the supreme court is part of the plan to destroy and topple Blackrock. Blackrocks finances are co-mingled and conjoined with Vanguard and State Street. This should topple all three if it happens.
This is the final money source of the deep state. If you haven't noticed, Trump has cut off financial sources from the deep state forcing the desperation.
Cut off from Medicaid. Cut off from all funding sources through fraud. Their only source is the big three. Fake loans that don't get paid with hopes of regaining power later.
I think the big three are the final step and why Ripple, World Liberty Financial have become banking institutions to replace them in the wake of their destruction.
When this happens, the instability is going to create chaos. The deep state will have no other recourse then to try and overthrow our government. I don't see any other option for them.
The insurrection act will be implemented. Lock down orders will be announced.
When everyone is locked in their homes, EMS will be live and the education of what's really going on will be delivered.
This is high level. There is more as so much is going on. So there are so many things that need to happen simultaneously.
But as I analyze everything that's going on this is what I think might happen
where to get the money that Mac & Mae needed to do the purchases?
ReplyDeleteOoop… print more fiat greenback!