The system is designed to pump assets forever
Discussion
And the assets are legally owned by the central banks
The fact that the fed still owns like 17% of US mortgage debt is so insane to me
Even more is owned by freddie mae and fannie mae and what other retarded names they came up with. nostr:nprofile1qyt8wue69uhh2mtzwfjkctnvda3kzmp6xsurgwqpzemhxue69uhkzarvv9ejumn0wd68ytnvv9hxgqpqu87g378r0puytp7zxdl5awg2gmqvqc3vgtnh6a0vfgm4y8es7c3qgxzczg knows more about it than I do.
Correct. Fannie, Freddie, Ginnie. If you add all 4, it’s ~95% of the US mortgage market. (I don’t keep a live tracker of these numbers, update once or twice a year, could be slightly outdated.)
So there basically isn’t a market of willing lenders for people to finance homes, the whole market is fake
Fake and gay
There are, it’s just that the MBS that Fannie and Freddie offer are *unofficially* backstopped from default, even though the market assumes they are. Ginnie is explicitly backstopped. So the real issue is a perverse incentive caused by government intervention, which creates an asset bubble…as is tradition.
If you’d like to learn more about the nuances of these entities, here’s the latest update from the best person I know on the topic, Alex Pollock. https://youtu.be/j4IriSJ0kmE