Name: The CEO of Fannie Mae Can Finally Start Looking to the Future
Uploaded: 2017-12-12
Duration: 5 min 49 s
Description: Tim Mayopoulos has made the company profitable once again, and wants to bring it into the digital age.

Tim it's pretty remarkable what you've done at Fannie May. It was in the height of the financial crisis, it was pretty bleak. And now it's profitable, it's paid back all of it's bill out money back to the government. If you could simplify to one thing, what would you say was key to the turnaround? I think the key to turn around really was the resilience of the people at Fannie May. I was really struck by the dedication and commitment of the people at the company. And they really labored through some very difficult times, trying to stabilize the company, and stabilize housing markets. We obviously worked hard to try to keep a lot of people in their homes, and avoid for closure as much as possible, and As time has gone by and markets have recovered, the company has also recovered. We've undertaken enormous reforms at the company and now we're very much focused on building a great housing finance system for the future. But Fanime is still under government control and you're still paying these huge dividends to the government in the billions, Of dollars when does that end? Ultimately where the administration and the Congress will decide what they wanna do with Bernie May. But our goal has been to be a good stewards for the tax payers, we really run the company for the benefit of Mm- hm. Tax payers to keep the housing finance system going. We took $ 116 billion of investment from tax payers And we've paid dividends of all of that plus another $ 50 billion on top of that. So, we're all taxpayers that's a happy story. You've certaintly done a lot to fix up Fannie Mae but Treasury Secretary Mnuchin said recently it still needs fixing. What kind of fixes? In my mind, the critical issues are, first we need to have a housing trans system that will actually function, functioning well, functioning good times and bad times. Second, we need to make sure that we protect taxpayers. We need to insulate them from exposure. So the last crisis should never happen again so we need to get a plenty of private capital in front of the taxpayer position. And we need to ultimately create a system that gives people access to credit and produces affordable housing. So, with this uncertainty and a lot of question marks, hanging over [ UNKNOWN ] Whats's next? Where do you go from here? SDo, for us whether we focus on the future of housing finance, this should be really be a digital process and the [ UNKNOWN ] Digital process it will make it faster It'll make it simpler, it'll make it less expensive, and it'll make it safer. And so, we've really been driving as much change as possible within the industry to make all that happen. We're trying to take the pain points out, the friction points out. Or make it faster, better, and cheaper for everyone. You don't usually think of a government entity thinking like an entrepreneurial startup. How successful do you think you'll be in this transformation? I think we will be successful. We have been successful. We are very entrepreneurial. We've been very focused on. Bring all the new technologies and all the change that all the businesses are dealing to housing finance. Let's talk a little bit about some economic factors that could impact your business. Interest rates are going up, which means that the rates on mortgages. Will be going up as well. I mean what does this mean for lower income people who are trying to get a mortgage? I think rising interest rates will actually compound a problem that alrady exists, which is the number of affordable units, whether theyr'e for home ownership or for rental, has been reduced over the last number of years And that's really putting a squeeze on families so rising in straits will only exacerbate that problem. As a country we need to have a national strategy about how we're going to deal with housing. We need to be able to figure out how we're going to create more affordable housing for more people and make that more widely available. How would you characterize the housing market right now whether you're a home buyer or a home seller? So I think market has clearly recovered from where we were a number of years to go, you know it has been a slow and steady recovery and I will expect that to continue to happen. But the challenge is really being around, people being squeezed out at lower end of it, affordability is a great challenge. But [ UNKNOWN ]. Markets are performing pretty well. And connected to the housing , market is the job market. We've seen multi hiring going up, how strong is the job market? And how do yousee it going forward into the new year? I think overall, job market clearly has been growing, but we need to remember we're in the eighth year of an expanding economy, hasn't always felt like an expanding economy. At some point we will, that expansion will end or we'll end up in a recession. I'm not predicting that in the short term, but we all need to recognize that that will come to an end at some point. I think clearly some of the efforts that policymakers have underway right now is to try and continue to stimulate the economy so But creating job growth has got to be at the top of that list. There seems to be a lot of momentum to get some kind of tax cut through Congress. President Trump is hoping that it's really gonna give a spark to the economy. There's considerable debate about this. Where do you stand? Well I think there is a lot of debate about it. Look, I think that The reduction in the corporate tax rate will I think stimulate some corporate activity the question is how much of that will just be transferred off to shareholders in terms of stock buy backs but I think that stimulating the economy at this point It's unclear what the effect is going to be and we see it's good for the stock market, the questions will be good for the fundamental economy. So, as you look ahead to the new year and you look at the economy, housing and jobs What kind a year are we in for in 2018? I'm optimistic, I do think that will continue see a pretty positive economy whether will get the big boost that [ UNKNOWN ] hoping to get from the tax reform. I'm not smart enough to figure that out. I think that's very difficult to measure. But I think that the economy will continue to grow. And I think all in all, 2018 will be a positive year. [ BLANK_AUDIO ]

Tim Mayopoulos has made the company profitable once again, and wants to bring it into the digital age.