#424 Chris Whalen: Fannie & Freddie Stuck, Foreclosures Rising, Credit Problems Coming

In this episode of The Wrap with Chris Whalen, Chris calls Treasury Secretary Scott Bessent’s comments on Fannie Mae and Freddie Mac a “pump and dump.” He explains why the GSEs won’t be released during Trump’s term and lays out his own fix: buy back the public common shares and leave the U.S. as the sole shareholder. He breaks down Auction.com data showing foreclosure auctions up 25% from a year ago as COVID-era protections end and housing shifts to a buyer’s market, and he shares his advice for sellers: price to sell. Whalen also covers REIT earnings, United Wholesale Mortgage’s strategy shift and Annaly’s return to book value. He explains why he’s less bullish than his friend Ralph on 10-year Treasuries near 5%, and whether the Fed will hike or hold at next week’s meeting. He says he’s long energy, adding to gold on weakness and cautious on financials as credit problems surface. He closes with the risk he thinks nobody is watching closely enough: an unexpected turn in the Russia-Ukraine war.

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Links:    

The Institutional Risk Analyst: https://www.theinstitutionalriskanalyst.com/ 

Twitter/X: https://twitter.com/rcwhalen    

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Timestamps:

0:00 Welcome to The Wrap

1:04 Bessent, Fannie and Freddie, and the “pump and dump”

3:48 Whalen’s fix: the U.S. as sole shareholder

5:08 Why “privatization” without control is a fraud

7:48 Foreclosure auctions up 25%

09:45 Is there a credit problem in housing?

10:56 Advice for sellers: price to sell

13:08 REIT earnings and UWM’s new strategy

14:19 Annaly back to book value

15:42 The case for 10-year Treasuries

19:14 Why Whalen isn’t as bullish on bonds

20:16 Bonds vs. gold vs. cash

22:06 October FOMC: hike or hold?

23:31 Natural gas down, diesel still high

24:59 Positioning: energy, gold and caution on financials

26:43 How income investing works

28:41 The biggest risk nobody’s talking about

32:00 What to watch next week

The content of this podcast is provided for informational, educational, and entertainment purposes only and does not constitute financial, investment, tax, or legal advice. Nothing discussed should be interpreted as a recommendation or solicitation to buy, sell, or hold any security. Guests' views are their own. Always do your own research and consult a qualified financial professional before making investment decisions.