Trump’s GSE Pitch Mints Stock Billions, Risks Costlier Mortgages

President Donald Trump’s announcement that he’s weighing a public offering of US mortgage giants Fannie Mae and Freddie Mac sent their shares soaring, extending gains this year for hedge funds and other investors to almost $50 billion.

But for US homebuyers, taking the entities public comes with risks that threaten to add more than $40,000 in costs to the typical borrower over the lifetime of the loan.

The public offerings would likely rank among the largest in history, with investors looking to grab a stake in companies that racked up more than $35 billion of pretax profit last year. ...