On GPS: Jake Sullivan says allies are trying to ‘de-risk' from the US
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8 minutes ago
- Yahoo
President Trump wants to take Fannie Mae and Freddie Mac public. The plan has some problems.
On Wall Street and in Washington, D.C., confusion reigns over how the Trump administration will pull off a potential public offering for mortgage giants Fannie Mae and Freddie Mac later this year. The Trump administration has floated the idea of selling down the government stakes in the two giants, a move that would amount to the largest IPO in history under current values being weighed. The precise mechanics of such a deal have yet to be clarified. Shop Top Mortgage Rates Your Path to Homeownership Personalized rates in minutes A quicker path to financial freedom Plans being discussed within the administration, first reported by the Wall Street Journal, could involve a 5% to 15% sale of Fannie and Freddie shares at a combined $500 billion valuation or higher. But to attract investors, analysts and housing experts see some problems that need to be solved along the way. In the meantime, President Trump is still weighing all of his options. That means plans could change. He has met in recent weeks with CEOs for some of the biggest Wall Street banks, including JPMorgan Chase's Jamie Dimon, Bank of America's Brian Moynihan, and Citigroup's Jane Fraser, to discuss the mortgage giants. Last weekend, he added more fuel to the IPO idea, sharing a doctored image of himself ringing the bell at the New York Stock Exchange on Truth Social. Behind Trump in the image is a banner for neither Fannie or Freddie, but instead a single entity called the "Great American Mortgage Corporation," listed with the stock ticker MAGA. So far, the government's plan for kicking off a public offering for the mortgage giants has left analysts and housing experts alike a bit baffled. Some are questioning whether such a sizable and complex stock offering could get done before the end of 2025. 'To hit this timeline, the Trump administration is going to have to move very quickly through some very weedy and substantive policy discussions,' said Jeb Mason, a former Bush White House and Treasury official. Fannie Mae and Freddie Mac, also known as the Federal National Mortgage Association (FNMA) and Federal Home Loan Corporation (FMCC), play essential roles in the US housing market by purchasing mortgages and then packaging and selling them as bonds to investors. Both fell under government conservatorship during the 2008 financial crisis, when mortgage defaults soared. Untangling the two firms from the government's control has been a long and hotly debated matter. Some prominent Wall Street investors, including billionaire Bill Ackman and John Paulson, placed their bets years ago by purchasing common and preferred stock in Fannie and Freddie, expecting the conservatorship for the two companies would eventually end. The first Trump administration aimed to do it, even hiring Morgan Stanley and JPMorgan Chase for advice. Ultimately, it could not get the job done. Such policy discussions revolve around weighing the potential benefits of reducing the federal government's role in the giants against the risks of disrupting the housing market. 'It's also possible that they are going to try to have some sort of market offering without answering all the key questions,' Mason added. For potential IPO investors, the most crucial questions are whether the mortgage giants can promise some degree of shareholder rights along with a relatively stable level of profit. The administration has at least two essential problems in front of it to fulfill those assurances, according to KBW analyst Bose George. In exchange for bailing out the mortgage giants more than a decade ago, the Treasury Department holds a substantial stake in Fannie and Freddie senior preferred shares, currently valued at over $340 billion. The conventional thinking is that the federal agency must either dissolve or convert its shares to common stock, with both options presenting potential lawsuits from taxpayers or existing shareholders. "It could be a very messy start for an IPO, especially with this idea that there could be huge amounts of litigation," said George. The other problem is that the mortgage giants face a $181 billion gap in the amount of loss-absorbing capital they are required to set aside in the event of a downturn. Meeting that minimum requirement would not only take the better part of a decade, it would also drastically drag down each of the giants' return on equity so much that "no one will buy the stock,' said George. But perhaps the biggest problem is if the Trump administration caters too much to investors. There's also 'all kinds of risk to the housing system and homeownership generally, if you wind up with an administration that is too hell-bent on making Fannie and Freddie too appealing to investors,' said Jim Parrott, a former Obama administration housing adviser. The Trump administration has also, so far, avoided laying out how it plans to ensure the mass perception that the government will backstop these firms in a crisis. This guarantee allows Fannie and Freddie to buy mortgages, package them as bonds, and sell them to investors at a lower credit rating. It remains hotly debated whether the administration will need to take further steps to ensure this guarantee does not weaken. If there is any degree of change of status between Fannie, Freddie, and the government where certain issues aren't addressed, "many Americans could unwittingly face higher mortgage rates," PIMCO's head of public policy Libby Cantrill said in a note to clients this week. Christopher Whalen, chairman of Whalen Global Advisors, an advisory firm focusing on mortgage finance and banking, said, "There is a vast communications task that has to occur to the housing complex, the realtors, the home builders, the lenders, the banks, everybody.' David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance. Click here for in-depth analysis of the latest stock market news and events moving stock prices
Yahoo
8 minutes ago
- Yahoo
Terry Newman: Keffiyeh-draped anti-Israel protesters target Jews at Saint John festival
Saint John's International Culturefest, according to the festival's website, is supposed to be 'a vibrant celebration of multiculturalism, community, and connection.' But it erupted into chaos on Aug. 2, when demonstrators gathered around an Israel booth, engaging in what some members of the Jewish community have described as threatening and intimidating behaviour culminating in an alleged assault and two arrests. No statement was made by the committee organizing the festival or the local police. The story was largely ignored by local media. According to an email forwarded to National Post, written by Lorie Cohen Hackett, president of the Saint John Jewish Historical Museum, a demonstration at the festival felt threatening to those volunteering at the Israel booth. Cohen tells members of the museum that both Shaarei Zedek synagogue and the museum 'hope for a peaceful and satisfactory resolution.' Below her message is one from Bruce Washburn, president of Shaarei Zedek synagogue, who describes to members of his congregation events leading up to an alleged altercation at the booth. According to Washburn, on Friday, Aug. 1, the evening before the International Culturefest, the Israeli flag at the event had been spray painted and had to be replaced with another from the synagogue on Saturday morning. But this wasn't all that happened. On Saturday Aug. 2, at the festival Washburn describes as 'an annual celebration of international cultures,' anti-Israel protesters with face coverings 'invaded the Israeli space and shot at those attending the booth with water guns filled with red water.' Washburn noted that when the volunteers 'attempted to protect their space, one was physically assaulted, breaking her glasses.' He told congregants, in his email, that the 'guarantees of security for the event from the Culturefest Committee were not fulfilled, and there was no apparent police presence at the time of the incident. The incident ended with the arrest of two of the protesters, based on the assault.' Washburn ended his email saying that the Board of the Congregation 'is actively seeking legal advice and remains committed to doing everything we can to restore safety and peace for the Jewish and Israeli community in Saint John and surrounding areas.' Mohamed Bagha, Managing Director of the Saint John Newcomer's Centre, which is responsible for the festival, declined a request for comment. According to Sgt. Shawna Fowler of the Saint John police department, at approximately 2:30 p.m. on the Saturday, police responded to a 'call about protesters making their way to the festival.' She pointed out that the caller described them as 'Palestinian demonstrators.' Fowler also said that 'calls were also received by attendees of the festival who described the protesters as wearing red bags over their heads, carrying signs, and one person was wearing a military uniform and carrying a gun later determined by police to be a water gun filled with red liquid. The protesters were at the Israel booth kneeling, chanting, and facing the crowd.' According to Fowler, when the police arrived, 'organizers advised that an incident had taken place at the Israel table,' and that a woman had been assaulted. 'A female along with witnesses alleged that she was assaulted by a masked protester,' Fowler said. 'The police arrested a youth for the assault,' and, 'as police were placing the youth under arrest, an adult male, unrelated to the assault was arrested for obstruction.' Both have been released and the adult will appear in court on Nov. 4. Fowler explained that 'police are considering additional charges related to hate crime pending the outcome of the investigation.' Multiple videos showing the nature of protests were posted to Facebook. Shortly after the police arrived at the festival, a post was created by Mohamed Elazab, the administrator of a Facebook group called Ask Saint John, at 4:02 pm ET. The post is titled, 'Concerning Incident at the Multicultural Fest in Saint John.' In the post, Elazab complains that the Saint John police arrested and detained a minor who, he claims, was 'peacefully protesting in a public space.' He goes on to say that his attached video proves that the minor was 'peacefully protesting in a public space.' Elazab then went on to further complain that when the protesters were arrested, officers did not disclose their names, activate body cameras, or inform the minor or his father for the reason of the detention. He then states that videos are attached for full transparency. While the three videos don't capture the alleged assault, what they do capture is an intimidating, threatening circus involving adults and children. In the first video, before the arrests, a camera is pointed directly at the Israel booth and its volunteers. What appears in front of the camera is chaotic. Three women in headscarves and one without face the booth, clapping as they chant: '1,2,3,4 — Occupation no more! 5,6,7,8 — Israel is a terrorist state!' In front of the women, a man can be seen to their left holding a sign that says, 'This is the only culture Israel has.' as he walks around a circle of individuals, including what appears to be young children, sitting on the ground with bags over their heads and their hands behind their backs while two men wearing army gear and helmets stand there with their faces covered. A man to the right of the camera wearing a hat and sunglasses appears, motions his arms to the demonstrators, and says 'Go away,' several times, shaking his head. A woman with a hijab moves closer and starts to film him with her phone. The man recording the video then says, 'Freedom of speech!' The man with the hat replies, 'This is not the time and place for this. This is a place to celebrate differences.' At this point, one of the army-clothed, helmet-wearing, face-covered individuals can be seen carrying a water gun, possibly the gun that was allegedly filled with red water which was pointed and shot at the Israel booth volunteers. The man holding the camera yells, 'Free Palestine!' The camera pans to the left to show others joining the chant which has switched to 'No more murders! No more lies!' In front of the Israeli booth, two women can be seen holding the Israel flag, which, if what Washburn said is true, is a replacement for the one which was spraypainted the evening before. This whole time, a woman with a headcovering has been holding what appears to be two fake dead babies directly in front of the booth, one could argue impeding, or at least deterring, it from being visited by festival goers. What appears to be the second video is only 30 seconds long. This one, taken by a woman, shouting various phrases, including, 'From the river to the sea, Palestine will be free,' as she and others appear to move closer to the two volunteers at the booth. What happens next is unclear. It looks as if one of the women at the Israel booth extends her phone into the crowd immediately front of her. Then, she backs up, presumably into the booth. The other female volunteer puts both of her hands up to signal stop. The third video, taken by a different person than the first two, shows police officers arresting one of the individuals who was wearing army gear and a helmet with their faces covered. Objections ring out from those supporting the demonstrators. One woman in a headscarf complains as he's arrested, 'He's a minor!' She follows the police with a camera as they remove him from the area. 'This is a public space,' is yelled out by the man who was recording earlier, along with, 'Freedom of speech!' over and over and over, again. The camera then pans to another individual who is being arrested. He's wearing a red bag over his head and must be the adult who was arrested and charged. A demonstrator in a jailbird jumpsuit yells, 'You're arresting kids now. We have kids in this. You IDF mother——s. Support Israel, you b—ch!' Then demonstrators, some cloaked in headscarves and keffiyehs and some not, start following the police as they remove the man who puts his finger in the air, with the red bag still over his head, and yells, 'Freedom of Speech!' Later in the video, the police are confronted by protesters holding phones in their faces. One woman yells at them, 'You guys are terrorists! Stealing… kidnapping children off the streets!' The individual in the jailbird suit yells, 'The Saint John police are arresting a minor without parental consent!' The Saint John police are f—ing Nazis!' At the end of the video, an individual instructs the man in the jailbird suit to 'record everything' and 'take them to the court…. 'You will win it…. You will make them pay money, by the way… 'Come here, I will tell you what to do. 'Ask for the badge number and name and the reason for detention. You need to ask for this. Then you need to take them make a statement in the police. Don't be violent, okay? 'I'm not violent, I'm just blathering,' the jailbird answers him. 'Just say, freedom of speech, or whatever.' The video ends with the jailbird following these instructions and asking an officer for their badge number. What about freedom from intimidation, harassment, and allegedly, violence? According to Esti Barlevy, the volunteer at the booth who wasn't allegedly assaulted, organizers of the festival had warned both the Newcomer's Centre and police that a protest had been planned for that day, and that they were concerned about safety. Still, she says, police left the area early and returned only after the alleged assault. According to Barlevy, organizers had assured volunteers at the Israeli booth that police would be present, but they left early. She says that around 2 p.m., a pro-Palestinian rally marched into the festival and stopped in front of their booth. Barlevy told National Post that, 'At some point, protesters came very close to us shouting, threatening, and defacing our materials by spraying red ink from water guns onto our books, our flag, and even the volunteers at the booth. When one of our female volunteers attempted to stop them from coming at us, she was punched in the face, sustaining a mild concussion and damage to her glasses.' (Saint John police did not confirm the details of the assault). Not long afterward, police arrived and arrested two individuals. Barlevy describes it as 'a deeply frightening experience,' which makes her 'long for the Canada (she) once knew, a place where everyone, no matter their background, could feel safe. We came here with dreams of building a better future for our children, believing Canada was a place of peace, acceptance, and respect.' Barlevy came to Canada from Israel in 2015. Local media were either unaware of, or ignored the story. No statements were made to the public by the local police or the festival's manager. What did make it to the local news that day was an announcement from Steven Guilbeault, Minister of Canadian Identity and Culture, that $61,000 would be invested in the festival by the federal government. Guilbeault's statement about the investment notes that it is to support 'events that celebrate Canada's cultural diversity strengthens communities by bringing people together and providing a platform to share our stories, heritage and traditions, helping build a stronger, more united Canada.' This year's Saint John International Culturefest appeared to do the opposite. National Post @TLNewmanMTL tnewman@ Michael Taube: Of course globally focused Carney hasn't opened his constituency office yet Opinion: Europe faces the Koreanization of Ukraine
Yahoo
8 minutes ago
- Yahoo
TSX futures fall as investors brace for action-packed week
(Reuters) -Futures tracking Canada's main stock index dipped on Monday as investors reined in big bets ahead of a busy week featuring Ukraine peace talks, a key U.S. central bank conference and domestic inflation data. The futures on the S&P/TSX index fell 0.1% by 05:52 a.m. ET (0952 GMT), after a 0.5% gain last week for the S&P/TSX Composite Index index, helped by expectations of interest rate cuts in the United States. [.TO] U.S. President Donald Trump will meet Ukrainian President Volodymyr Zelenskiy and European leaders later on Monday to advance peace negotiations. The meeting follows Trump's talks with Russian President Vladimir Putin in Alaska on Friday, which failed to produce a peace agreement. Ahead of the Trump-Zelenskiy meeting, gold prices eked out modest gains, supported by lower U.S. Treasury yields. Oil prices rose as investors awaited more clues from the meeting. [GOL/] [O/R] Another key event this week is the Federal Reserve's annual economic policy symposium in Jackson Hole, Wyoming, on Friday, which investors will watch for clues on monetary policy. According to the CME Group's FedWatch tool, traders are pricing in an 84.8% likelihood for an interest rate cut in September. In Canada, investors will monitor July inflation data due on Tuesday; a Reuters poll of economists expects the annual rate to slow to 1.7% last month. A fall in domestic inflation could prompt the Bank of Canada to slash interest rates. The central bank left rates unchanged at its last meeting and signaled further cuts if the economy weakens and inflation stays contained. The July housing starts data is due later in the day, and June retail sales figures on Friday. FOR CANADIAN MARKETS NEWS, CLICK ON CODES: TSX market report [.TO] Canadian dollar and bonds report [CAD/] [CA/] Reuters global stocks poll for Canada Canadian markets directory ($1 = 1.3792 Canadian dollars) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
