Bill Ackman calls Fannie and Freddie release from conservatorship politically critical, stocks soar

Pershing Square CEO Bill Ackman made an urgent public push on October 22 for the Trump administration to release Fannie Mae and Freddie Mac from conservatorship, calling it "absolutely politically critical" to do so before the end of the Trump term. Speaking in a CNBC interview, Ackman warned that a future Democrat-controlled government could weaponize the two government-sponsored enterprises against Republicans if they remain under federal control.

Ackman, who holds a large stake in both companies, argued the stocks could rise tenfold and described them as the most asymmetric investment he is aware of in the market. He noted that Fannie Mae and Freddie Mac have now built up roughly five times the capital they historically carried, a point he said is not widely appreciated by investors. Shares of both companies surged sharply following his comments, with the Seeking Alpha report flagging the move as a notable event in financial markets on the afternoon of October 22.

The remarks put fresh pressure on the administration to act on an issue that has been debated since Fannie and Freddie were placed into conservatorship during the 2008 financial crisis. Separately, consensus price targets on related preferred stock moved in opposite directions on the same day: the average target on PennyMac Mortgage Investment Trust preferred shares rose 14.06 percent to $25.08, while the target on Federal National Mortgage Association preferred shares fell 17.25 percent to $13.39.