Patrick Power PRO
Economics PhD @ Boston University
Diagrams
The Economics of Housing and homelessness
Household
Mortgage Originator
Fannie Mae
Life Insurance Company
FHA
Household
Mortgage Originator
Fannie Mae
Investors
Household
Mortgage Originator
Fannie Mae
Investors
6.77\%
5.48\%
6/30/25
Binding
Household
Mortgage Originator
Fannie Mae
Salomon Brothers
First Boston
First Boston
Mortgage Originator
Investors
US Government
Household
Mortgage Originator
Fannie Mae
Salomon Brothers
First Boston
First Boston
Mortgage Originator
Investors
US Government
Risky
Household
Household
Mortgage Originator
Fannie Mae
Goldman Sachs
Chase
Mortgage Originator
Investors
US Government
Risky
Household
Fannie Mae
Salomon Brothers
First Boston
First Boston
Investors
US Government
Investors
Affordable Housing
Rating Agencies
Assets
\$7.8 \ \text{Trillion}
Liabilities
\$7.6 \ \text{Trillion}
Capital
\$160 \ \text{Billion}
Total Equity
\$160 \ \text{Billion}
Gov Senior Preferred
Regular Preferred
\$33 \ \text{Billion}
\$350 \ \text{Billion}
?
Common Shareholder
Claims
79\% \text{Government}
Option #1
Option #2
Lend them the money, charge them a high interest rate, and take a big equity kicker (say 79.9% of their stock).
Just nationalize them entirely, zero the shareholders, zero the preferred shareholders
Assets
Liabilities
\$1 \ \text{Million Equity}
\$5 \ \text{Million Property}
\$4 \ \text{Million Debt}
2025
Assets
Liabilities
\$2 \ \text{Million Equity}
\$6 \ \text{Million Property}
\$4 \ \text{Million Debt}
2027
\mathbb{E}\Big[\mathbb{E}\big[\frac{d}{da}\tilde{Y}_i(a)\big]\Big]
Average
(Over Voucher Length)
Marginal Change
Expected
(Over People)
Housing Stability
Voucher Length
A \perp B \ \vert \ C
Treated
Control
\tilde{Y}_i(1)
\tilde{Y}_i(0)
Filled in Subsets Denote "Attrition"
All Possible Worlds
X_1
X_2
X_{360}
\vdots
Mortgage
X_{359}
Asset
All Possible States of the World
\sum _{i=1}^nX_i
Mortgage Backed Security
Housing Supply Elasticity
Demand
Atlanta
Dallas
Phoenix
*Not Meant to be Entirely Representative
Boston
New York City
Los Angeles
San Francisco
Cleveland
Detroit
2005
Y_1
Y_2
Y_3
Y_4
?
X_1
X_2
X_3
X_4
X
All Possible Functions
Our Focus
Assets
Liabilities
Equity
The Balance Sheet
Assets
Liabilities
Equity
The Balance Sheet
30-Year Mortgages
Deposits
Residential Mortgage Market
Mortgage Bonds
Price
Supply
Demand
Price
Supply
Demand
Demand'
Residential Mortgage Market
Mortgage Bonds
Copy of The Economics of Housing and Homelessness: The Current Administration
By Patrick Power
