The Wrap: Bessent Pumps Fannie & Freddie, Gold Falls, Foreclosures Up

In this special edition of The Institutional Risk Analyst, we provide a setup for the latest episode of “The Wrap” with Chris Whalen” hosted by Julia LaRoche. Each week we ponder developments from Washington & on Wall Street and provide some badly needed context for our viewers.  

Pump & Dump: Treasury Secretary Scott Bessent told Mark Halperin in a 10/20/26 exclusive interview that “the Trump administration "will be tackling the ownership structure" of Fannie Mae and Freddie Freddie in "the next year [or] the year after."  The stock prices of both GSEs soared briefly during the week and then retraced, providing a ST trading opportunity to hedge funds.

Secretary Bessent continued: “It's unclear why homeowners or mortgage holders would benefit for a change in the arrangement of the shareholder structure. So whatever we do is going to be guided by making sure that the spread on mortgages ... does not increase; that's our North Star." Sounds like nothing is gonna happen despite the market kerfuffle.

LT Interest Rates: The U.S. 10-year Treasury yield dropped this week, falling from roughly 5.15% down to just below 5% on Thursday amid mounting concerns over AI valuations and the Iran war. We wrote positively about the 10-year Treasury note and earnings reports from AGNC Investment Corp (AGNC) and Annaly Management (NLY) in The IRA this week. 

Gold vs Treasuries: Gold prices dropped by about $163.20 per troy ounce (-3.88%) over the past 5 days, falling from approximately $4,204.50 on October 16 to $4,041.30 on October 22, 2026. Investors continue to rotate toward U.S. Treasury paper and away from gold amid market flows. High interest rates weigh on mostly non-yielding assets like gold ahead of upcoming Federal Reserve meetings, yet precious metals and strategic commodities such as copper remain in short supply. 

Affordability: Oil prices surged to a five-month high as the US and Israel reportedly consider more strikes against Iran after the midterm elections. U.S. retail diesel fuel prices have jumped significantly since June 2026, rising from an average of roughly $5.06 to $5.35 per gallon in early-to-mid June to $6.276 per gallon by October, according to the U.S. Energy Information Administration (EIA). Grocery prices are up about 2% in the past 12 months, but restaurant prices are up twice that amount.

Good news: Natural gas prices have dropped roughly 19% to 24% compared to the same time last year, and feature futures are trading around $2.78 to $3.58 per MMBtu (down about 40% from the high start of the year near $4.69–$7.72/MMBtu).

Foreclosures: Auction.com shows foreclosure sales volume increased 25 percent from a year ago, rising to a new post-pandemic high but still 29 percent below the Q1 2020 pre-pandemic level. FHA-insured and recent-loan vintage (2022+) foreclosure auction volume both up 73 percent, Q3 FHA volume was 17 percent above its pre-pandemic level in Q1 2020 to the highest volume since Q1 2019, and bank-owned (REO) auction volume was up 18 percent from a year ago but is still 49 percent below its Q1 2020 pre-pandemic level. 

Money Politics: Media mogul and former NYC Mayor Michael Bloomberg sent about $80 million to Democratic causes in September and October, with at least $50 million aimed at House races and roughly $10 million more on the way, according to figures his team gave The New York Times. But veteran Democratic political operative Joe Costello opines that the NYT amusingly noted the one political entity in the country more unpopular than Donald Trump is the Democratic party. Whatever the upcoming election’s outcome, that fact will be a weight on the results. 

The Institutional Risk Analyst (ISSN 2692-1812) is published by Whalen Global Advisors LLC and is provided for general informational purposes only and is not intended for trading purposes or financial advice. By making use of The Institutional Risk Analyst web site and content, the recipient thereof acknowledges and agrees to our copyright and the matters set forth below in this disclaimer. Whalen Global Advisors LLC makes no representation or warranty (express or implied) regarding the adequacy, accuracy or completeness of any information in The Institutional Risk Analyst. Information contained herein is obtained from public and private sources deemed reliable. Any analysis or statements contained in The Institutional Risk Analyst are preliminary and are not intended to be complete, and such information is qualified in its entirety. Any opinions or estimates contained in The Institutional Risk Analyst represent the judgment of Whalen Global Advisors LLC at this time, and is subject to change without notice. The Institutional Risk Analyst is not an offer to sell, or a solicitation of an offer to buy, any securities or instruments named or described herein. The Institutional Risk Analyst is not intended to provide, and must not be relied on for, accounting, legal, regulatory, tax, business, financial or related advice or investment recommendations. Whalen Global Advisors LLC is not acting as fiduciary or advisor with respect to the information contained herein. You must consult with your own advisors as to the legal, regulatory, tax, business, financial, investment and other aspects of the subjects addressed in The Institutional Risk Analyst. Interested parties are advised to contact Whalen Global Advisors LLC for more information.