Monetary Matters with Jack Farley Trump’s Hidden Mortgage Stimulus from Fannie & Freddie | Joseph Wang on GSEs, Kevin Warsh, Powell, and Dollar Hedging
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Jan 31, 2026 
Joseph Wang, macro commentator and author of FedGuy.com who analyzes central banking and GSEs. He explores how the White House could lower mortgage rates using Fannie, Freddie, and Federal Home Loan Banks. He discusses Trump’s influence on the Fed, possible Fed leadership changes, dollar hedging and capital flows. He flags US economic tailwinds and cautions about an AI stock bubble.
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GSEs Can Directly Compress Mortgage Yields
- Fannie Mae and Freddie Mac can lower mortgage rates by expanding mortgage purchases, reducing yields via supply-demand effects.
- Joseph Wang notes these GSEs once held $1.5 trillion in mortgages and could plausibly rebuild large portfolios quickly.
FHLBs As A Mortgage Liquidity Lever
- Federal Home Loan Banks can extend cheap advances to mortgage REITs to boost mortgage demand and depress rates.
- Wang highlights expanding FHLB access as a practical lever to increase mortgage liquidity without Fed rate cuts.
Use FHFA Authority To Expand GSE Portfolios
- The White House can instruct the FHFA to let Fannie and Freddie expand portfolios up to or beyond current caps to push rates lower.
- Allow regulators to lift or remove the $450 billion cap to meaningfully increase GSE mortgage holdings, Wang argues.
