Chris Whalen: Trump Doesn't Want Home Prices to Fall — But He Has No Choice
Speakers
Chris Whalen
— Chairman, Whalen Global Advisors
Summary
Chris Whalen discusses Trump's Davos speech, arguing the administration has no real plan to make housing cheaper and that demand-stoking policies will only push prices higher near term before a significant 2028 correction. He expects Trump to run the economy hot into the midterms, sees the dollar weakening and gold heading toward $5,000, and warns that long-term yields may keep rising even as the Fed cuts. He also comments on silver, copper, stablecoins, and the FDIC's approval of Ford and GM deposit-taking banks.
- Trump's Davos housing affordability message lacked a concrete plan to lower home prices.
- Whalen sees demand-stoking policies and rate cuts creating a near-term housing mini boom, followed by a 2028 correction.
- He expects hot markets like San Diego, Florida, and the Carolinas to cool first, with post-COVID mortgages potentially underwater in a 20%+ decline.
- Gold is favored as the dollar weakens and central banks buy; silver and copper are also viewed positively as hard assets.
- Long-term Treasury yields may rise despite Fed cuts, flattening the 2s10s curve and pressuring loan pipelines.
- He expects one or two Fed cuts this year and warns a new Fed chair losing an FOMC vote could hit markets.
- FDIC approval of Ford and GM deposit banks is seen as non-systemic and part of a broader industrial loan company rebound.
- Stablecoins are viewed skeptically due to liability and run-risk concerns.
Ideas
Housing corrects by 2028, loans underwater
Trump administration proposals will stoke housing demand, not make homes cheaper; 401(k) withdrawals and falling rates create more buyers against limited supply, producing a mini boom this year and next. But hot markets cool first, including San Diego, Florida, and the Carolinas, and prices have outrun inflation, wages, and investment returns. Chris expects a significant correction by 2028, with prices potentially back to 2020-21 levels, about 20% or more depending on the market, leaving every mortgage made since COVID underwater.
Gold rises as dollar weakens
Gold is likely to do well when the bond market is weak and long-term rates are rising. The dollar is expected to keep weakening as Trump runs the economy hot for the midterms; gold strength is essentially dollar weakness. Central banks have reversed 70 years of policy and are buying gold to diversify away from dollars, with limited supply supporting prices; gold is nearing $5,000/oz and is an important investment asset and hedge.
Long-term yields rise despite Fed cuts
Long-term Treasury yields are likely to keep rising despite Fed cuts. Policy noise from Washington and heavy Treasury issuance, including $700 billion raised mostly via T-bills, are undermining confidence and leaving the long end driven by investor sentiment, not Fed or Treasury control. If the Fed cuts another quarter point, the 10-year yield could rise and the 2s10s curve could flatten, which would hurt lenders loan pipelines when they sell mortgages into the bond market.
Long-term yields rise despite Fed cuts
Long-term Treasury yields are likely to keep rising despite Fed cuts. Policy noise from Washington and heavy Treasury issuance, including $700 billion raised mostly via T-bills, are undermining confidence and leaving the long end driven by investor sentiment, not Fed or Treasury control. If the Fed cuts another quarter point, the 10-year yield could rise and the 2s10s curve could flatten, which would hurt lenders loan pipelines when they sell mortgages into the bond market.
Dollar weakens as Trump runs economy hot
The U.S. dollar is likely to continue weakening. Trump is expected to run the economy hot to win the midterms even if the medium- and long-term consequences are negative, and policy noise from Washington is undermining confidence. Chris says gold going up really means the dollar is going down, with central banks diversifying out of dollars; the dollar has already lost substantial value since Nixon closed the gold window in 1971.
Fed chair loss may hit markets
A new Fed chairman who calls for lower rates and then loses an FOMC vote would be a negative market scenario. Chris argues the Fed's credibility depends on consensus and slow deliberation; if the chair is publicly defeated, markets could sell off, especially with long-term rates already rising. He sees this as quite possible and says the bill for running the economy hot could come after the midterms.
Fed cuts once or twice this year
With the latest inflation numbers, Chris thinks the Fed has room for another cut and would do one in the next month or two. He expects one or two cuts this year and possibly more next year, though the Fed should then watch how long-term rates react given the large deficit.
Silver gains on industrial and investor demand
Silver has upside because it has both monetary and investor demand and real commercial and industrial demand, with limited supply. It recently took off partly on a short squeeze and pent-up investor and commercial buying, and it is still doing well. Unlike gold, central banks are not buying silver, but it remains an important hard asset in the same category as copper and other key metals.
Copper has real-world value and demand
Copper is another classic hard commodity with real-world applications and real value that is transformed into many different products. Chris groups it with silver and other key metals as assets that are undervalued relative to inflation and dollar depreciation.
Up Next
This Julia LaRoche Show video, published January 24, 2026, features Chris Whalen discussing US home prices, GLD, TLT, 2s10s yield curve, USD, SPY, Fed Funds Rate, SILVER, COPPER. 9 trade ideas extracted by AI with direction and confidence scoring.
Speakers: Chris Whalen · Tickers: US home prices, GLD, TLT, 2s10s yield curve, USD, SPY, Fed Funds Rate, SILVER, COPPER