Staff Reporter
Billionaire investor Bill Ackman believes that President-elect Donald Trump will take steps to remove Fannie Mae and Freddie Mac from conservatorship, potentially restoring them as private companies.
Ackman shared this outlook on Monday, leading to a significant increase in stock prices for both entities—Fannie Mae’s shares surged by 18.4%, while Freddie Mac’s rose by 18%.
In his post on the social media platform X, Ackman stated, “A successful emergence of Fannie and Freddie from conservatorship should generate more than $300 billion of additional profits to the Federal government (this is on top of the $301 billion of cash distributions already paid to the Treasury) while removing ~$8 trillion of liabilities from our government’s balance sheet.”
In his recent post, Bill Ackman suggested that Fannie Mae and Freddie Mac might emerge from conservatorship within the next two years, potentially paving the way for their public listing around 2026.
Created by US Congress, Fannie Mae and Freddie Mac operate as for-profit corporations with private shareholders, aiming to expand the national home lending market by purchasing home loans from private lenders and converting them into mortgage-backed securities.
However, when the housing market collapsed in 2008, both companies faced massive losses. To prevent severe repercussions for the U.S. economy, they were placed in conservatorship under the newly established Federal Housing Finance Agency.
