Bill Ackman’s plan calls for Treasury to forgive its senior preferred shares, a strategy that some industry observers say would be politically risky for President Trump.

Securities industry stakeholders say preservation of the secondary mortgage market, especially MBS futures trading on the TBA market, is essential to keeping mortgage rates low.

In the early years of Fannie/Freddie conservatorship, investors were seeking an explicit guarantee of GSE MBS as part of any reform effort. More recently, they have shown an acceptance for maintaining an implicit guarantee.