Fannie Mae’s stock price jumped 54% on Monday and shares of Freddie Mac spiked 47% after billionaire hedge fund manager Bill Ackman called the stocks “stupidly cheap” in a Sunday evening X post.
Ackman’s post didn’t mention that his hedge fund, Pershing Square Capital Management, owns about a 12% combined stake in the government-sponsored enterprises (GSEs), which drew criticism from economist Peter Schiff.
“It must be nice to have so much power on X that one post can pump your own position by 30%,” Schiff wrote in reply to Ackman’s social media statement. “What would be stupid is for Trump to actually implement your plan. It might make you and anyone else who sells GSE shares richer, but it will harm taxpayers, housing, and the U.S. economy.”
In August 2025, Ackman had argued that Fannie and Freddie should merge, writing that it would enable the companies to “achieve huge synergies both in their operations and in the trading price and spreads of their [mortgage-backed securities], savings which could be passed along to consumers in the form of reduced mortgage rates.”
He subsequently urged the Trump administration to delay an initial public offering for the companies, which have been in federal conservatorship since the 2008 financial crisis.
Ackman advocated instead for a two-phased approach, whereby prior to being relisted on the New York Stock Exchange, the companies would remain under federal conservatorship while the government first properly accounted for repayment of its senior preferred stock and exercised the Treasury Department’s 79.9% warrants in both companies, formalizing the government’s permanent outsized stake in each.
In December, Ackman doubled down on that slow-and-steady approach, calling it his “best idea for 2026.”
Ackman’s weekend X post contended that Fannie’s and Freddie’s share prices could grow by 10 times their current values, “and it could happen soon.”
That prompted investor Michael Burry — best known for his “big short” move that predicted and profited from the subprime mortgage crisis — to respond: “Cannot emphasize enough how rare this is in this market.”
Burry had posted what he termed an “open letter” on Fannie, Freddie and the broader housing market to his X account on March 27, in which he argued that the U.S. does not have a housing shortage, contrary to the claims of many housing economists.
Instead, Burry maintained, “the problem is that bigger houses are inefficiently housing fewer people.”
“Building more new overpriced, poorly built homes in increasingly dangerous flood zones and other hazardous fringe areas is not the solution,” Burry wrote. “It adds to the problem through high maintenance burdens on new homeowners with little equity in their homes.”
The founder of Scion Asset Management asserted that Fannie and Freddie need to be recapitalized while retaining easy access to capital markets.
“To achieve this they need to exit conservatorship in a manner that excites markets to fund these companies now with guidelines to prevent risk-taking outside of their purpose,” Burry wrote, “and grow their purchases of mortgages of well-targeted specification.”
