Episode summary
Will we see quantitative easing with a new Fed chair?
HousingWire Daily
· · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Logan Mohtashami argues that a new Fed chair would not suddenly restart quantitative easing to force mortgage rates lower. He says the Fed is not going back to the post-financial-crisis playbook of large-scale bond buying, and that current purchases by Fannie and Freddie are not the same thing as QE. In his view, rates are still being driven mainly by Fed policy, nominal growth, inflation expectations, and labor-market data, not by a direct central bank effort to suppress mortgage rates.
He frames 2026 mortgage rates around a 10-year Treasury range of roughly 3.80% to 4.60%, which translates to about 5.75% to 6.75% mortgages depending on spreads. Logan says a move below 3.80% would likely signal recession risk, while a move toward 4.60% would imply stronger growth and stickier inflation. He stresses that the recent improvement in mortgage spreads has made a sub-7% mortgage rate environment more sustainable even without QE.
The biggest wildcard, he says, is not bond buying but a change in Fed leadership and housing policy under Trump. Logan thinks labor data remains the key indicator, with jobless claims still too low to suggest the labor market is breaking. He expects a more dovish Fed chair would push back on hawkish policy rhetoric, but not change the basic reality that QE is unlikely without a much deeper shift in the Fed’s operating framework.
Key takeaways
- Logan Mohtashami says a new Fed chair is not likely to trigger quantitative easing, because the Fed would need a much bigger regime change to restart large-scale bond buying.
- He pegs 2026 mortgage rates at roughly 5.75% to 6.75%, depending on whether the 10-year Treasury stays near 3.80% to 4.60% and spreads remain normal.
- Logan says current mortgage-rate declines are being helped by better spreads, not by direct Fed MBS purchases, which he says are often misunderstood as QE.
- He argues jobless claims are still the key labor indicator, and claims below 200,000 do not signal a broken labor market.
- Logan says a more dovish Fed chair would likely be more aggressive about rate cuts, but not enough to force rates into the fours without recession or a major policy shift.
Notable quotes
“the Federal Reserve is not going to do QE”
“there is there is not going to be an active quantitative easing to to push rates lower”
“Bottom is 380, right? If we go below 380, that means the market really thinks we're going into recession or something like that”
“if there's one ring to rule them all, there's one labor data and it's jobless claims”
How the episode opens
Welcome everyone. My guest today is lead analyst Logan Motoshami to talk about the possibility of quantitative easing under a new Fed chair and the potential impact on mortgage rates. Before we dive in, I want to thank our sponsor Trust and Will for making this episode possible. Logan, welcome back to the podcast.
It is wonderful to be here still in Texas. I have no idea what time it is, but it's a beautiful day. Got American flag right in front of me. Got the Texas flag right in front of me. So, I'm good to go. And uh we have an interesting topic today.
Yes, we do. You know, in Texas, we like to have giant Texas flags everywhere. If you've noticed, like — Yes, I've seen some of those giant flags. You think — I know we'd have to we have to like, you know, have one of those, you know, carried on stage. A big flag, you know. You know,
Wouldn't that be amazing? Okay. So, our topic today is really interesting because it feels like we are getting narrowed down on who might be the next Fed chair. Is that your uh and that's Kevin Hasset. Is that your feeling?
You know, there was so much talk with the Powell Department of Justice and now that you know, you know, there's push back against that and the you know, they're not going to let the new Fed get new new chairman get picked and thought the Rick Reer thing was just a distraction. And I don't think that's that was anything serious. But one of the things that is starting to happen is people think that if there is a new Federal Reserve chairman and let's say somehow they get maybe one or two new governors that the Fed is going to start to do QE again, quantitative easing and
That's not a thing.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- quantitative easing
- fed chair nomination
- mortgage rates
- fed leadership uncertainty
- doj investigation
Watch the episode
Watch “Will we see quantitative easing with a new Fed chair?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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