Trump says he's seriously considering taking Fannie Mae and Freddie Mac public
WASHINGTON, May 21 (Reuters) - U.S. President Donald Trump said on Wednesday he will make a decision in the near future about taking mortgage finance firms Fannie Mae and Freddie Mac public, saying that he is giving "very serious consideration" to doing so.
In a post on Truth Social, Trump said he will speak with Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and Federal Housing Finance Director William Pulte.
"Fannie Mae and Freddie Mac are doing very well, throwing off a lot of CASH, and the time would seem to be right," Trump said, without providing further details.
Fannie and Freddie, which operate as for-profit corporations with private shareholders, were created by the U.S. Congress to expand the national home lending market by buying home loans from private lenders and repackaging them as mortgage-backed securities.
When the housing market collapsed in 2008, Fannie Mae and Freddie Mac suffered overwhelming losses. To avoid catastrophic effects for the U.S. economy, they were placed in conservatorship under the newly created Federal Housing Finance Agency.
Previous attempts to rid government control of the organizations, including under Trump's first term in office, have been unsuccessful.
In February, Bessent said the release of Fannie and Freddie from their conservatorship would depend on mortgage rate implications.
"The priority for a Fannie and Freddie release, the most important metric that I'm looking at, is any study or hint that mortgage rates would go up," Bessent said in an interview with Bloomberg.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Independent
16 minutes ago
- The Independent
Blow for Rachel Reeves after UK economy shrinks by more than expected
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging. At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story. The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it. Your support makes all the difference.
Reuters
21 minutes ago
- Reuters
Trump's energy dominance agenda could be ravaged by Section 899
LONDON, June 12 - A proposed U.S. tax targeting foreign investors could hurt European energy giants that operate in America's booming oil and gas sector, undermining what President Donald Trump describes as his energy dominance agenda. Trump's sweeping tax and spending bill under review by the Senate includes an additional tax of up to 20% on foreign investors' income, such as dividends and royalties. The tax, known as Section 899, was devised as a pushback against countries that impose what the bill describes as "unfair foreign taxes" on U.S. companies, such as digital services taxes. Section 899 is believed to be targeting companies headquartered in the European Union and Britain, which both have tax systems considered discriminatory by the Trump administration. The provision is a significant threat to London-listed Shell (SHEL.L), opens new tab and BP (BP.L), opens new tab as well as France's TotalEnergies ( opens new tab and Spain's Repsol ( opens new tab, which all have sprawling operations in the United States. Trump, who often used the slogan "drill, baby, drill" in his election campaign, has portrayed himself as pro-fossil fuel, vowing on his first day in office to maximise oil and gas production. But if approved, Section 899 could have the opposite effect. BP last year invested more than $6 billion, about 40% of its capital expenditure, in the United States, where its interests include onshore and offshore oil and gas operations, two refineries, thousands of retail fuel stations and a power trading business. The country is also home to more than a third of BP's global workforce of about 90,000 and accounted for roughly 30% of its 2024 revenue of $189 billion and more than a quarter of its $21 billion net profit. Shell, the biggest European oil major, is also a huge investor in the United States, which accounted for 23% of its 2024 revenue of $284 billion. It invests about 30% of its capital expenditure in the country, where it has oil and gas production facilities, a petrochemicals plant, a vast retail network, liquefied natural gas (LNG) purchasing agreements and major trading operations. The United States became increasingly important to Big Oil companies in recent decades thanks to its stable fiscal and regulatory environment while other regions presented a variety of challenges. Take Russia, for example. Its vast oil and gas resources started attracting investments from many companies in the 1990s after the collapse of the Soviet Union, but the country is now uninvestible owing to western sanctions that followed Russia's invasion of Ukraine in 2022. Similarly, western companies have limited opportunities to invest in the Middle East, where national oil companies dominate. Europe, meanwhile, has limited natural resources and strict environmental regulation. The multinational nature of oil and gas companies means they have plenty of experience dealing with tax uncertainty, but shifting tax policies tend to delay investments. Company boards require long-term confidence to proceed with large, multi-decade capital projects such as oil and gas fields or LNG plants. The industry's confidence in the United States was already shaken under Trump's predecessor, Joe Biden, who in 2020 revoked a construction permit for the Keystone XL pipeline. The Biden administration also paused approvals for new LNG projects in 2024 because of climate concerns. Trump lifted the pause when he entered the White House. According to Section 899, multinational companies could face a new tax on dividends sent overseas and inter-company loans, potentially reducing profit. The Gulf of Mexico accounted for about 10% of Shell's 2024 free cash flow of $40 billion, it said in a presentation. That means that Section 899 could shave $800 million from its free cash flow per year from Gulf of Mexico operations alone. BP made about $1.5 billion in free cash flow in the United States last year, Reuters calculations show. A 20% dividend tax could translate into a $300 million loss in free cash flow. Faced with the worsening fiscal terms, companies could opt to direct funds away from the United States. Though options for deploying capital elsewhere on a similar scale are limited, companies could choose to spread their investments more widely. Such a scenario could be a boon for countries such as Canada, Brazil, Mozambique and Namibia, which have large untapped natural resources. Another option would be for companies to transfer their headquarters and listings to the United States - a costly and politically complicated option. Shell previously contemplated such a move to boost its share value, though it appears to have abandoned the idea. Ultimately, it is very likely that the Senate would push to modify Section 899 or limit its scope, given the potential far-reaching impact on many sectors. But barring a radical change, Section 899 poses a huge risk for European oil and gas giants that are heavily dependent on the United States. Achieving the Trump administration's energy dominance agenda will almost certainly require more foreign investment, not less, so if the CEOs of European energy companies complain loudly enough, the president may well listen to them. The opinions expressed here are those of the author, a columnist for Reuters Enjoying this column? Check out Reuters Open Interest (ROI), opens new tab, your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis. Markets are moving faster than ever. ROI, opens new tab can help you keep up. Follow ROI on LinkedIn, opens new tab and X., opens new tab
Reuters
26 minutes ago
- Reuters
UK economy shrinks by 0.3% in April, ONS says
LONDON, June 12 (Reuters) - Britain's economic output contracted by a worse-than-expected 0.3% in April, when shockwaves from U.S. President Donald Trump's announcement of wide-ranging tariffs hit the global economy, official data showed on Thursday. A Reuters poll of economists had forecast that Britain's gross domestic product would fall by 0.1% in April compared with March's level. Britain's economy expanded by 0.7% in the first quarter of 2025, outstripping growth in other countries in the Group of Seven advanced economies and prompting the Bank of England to revise up its full-year growth forecast to 1% last month. However, the BoE revised down its growth forecast for 2026 to 1.25% and said it expected the tariffs to knock 0.3% off British output in three years' time. BoE policymakers who are expected to hold interest rates next week are faced with competing forces of stubborn inflation and a relatively sluggish economy. A closely-watched business survey earlier this month suggested much of the economy returned to tepid growth. Business surveys of British firms have generally been downbeat and shown firms slowed their hiring and investment plans due to big increases in labour costs announced by finance minister Rachel Reeves last October. Data published this week showed a fall in consumer spending in May.
