President Donald Trump has floated some big ideas to make life more affordable for everyday Americans in the last week, but one veteran economist has his doubts that they’ll make much of a difference.
In fact, he sees the plans to lower mortgage rates and cap credit card interest as potentially doing more harm than good.
Trump revealed plans to bring down mortgage rates and make credit card debt cheaper. For mortgages, he said he had directed “representatives” to buy $200 billion of mortgage bonds, while his plan for credit cards entails capping interest at 10% for a year.
The president framed both plans as being in the interest of US consumers, but Moody’s Analytics chief economist Mark Zandi thinks that both moves could end up having the opposite effect.
Zandi spent much of 2025 sounding the alarm over Trump’s policies, which he said could push the US toward a recession, and he’s remained pessimistic so far in 2026.
Zandi posted on X that the news of Trump’s housing market plan has already pushed fixed mortgages down by 10 to 20 basis points. While that sounds like good news for borrowers and is likely exactly what Trump wants to see, the sudden dip in rates could ultimately drive home prices up.
“Unfortunately, this will do little to make homebuying more affordable, as while the lower rates will support housing demand, given the severe housing shortage, it will also result in higher house prices, all else equal,” he said.
Zandi also warned that Trump’s intention to use Fannie Mae and Freddie Mac to pile up mortgage bonds could pose further complications. He said it would effectively weaken a safeguard imposed on the two mortgage giants following the 2008 housing market crash that was meant to keep them from posing a systemic risk to the economy.
Zandi also said he had issues with Trump’s credit card idea.
He told Business Insider that while he sees little chance that Trump’s plan for a cap on credit card interest rates would clear legal hurdles, the move would ultimately curtail the availability of credit for borrowers who rely on it.
“Only consumers with high credit scores would avoid having their credit lines reduced or eliminated altogether,” he said. “That’s because banks and other credit card lenders simply won’t be able to profitably extend credit cards at a 10% rate to many Americans.”
Zandi predicted that higher-income households would benefit from lower rates middle and lower income people would be shut out.
Analysts at UBS echoed Zandi’s perspective on credit card rate caps, arguing that caps on credit card interest could harm not just lower-income consumers but the broader economy, as it would mean less spending. Billionaire hedge fund manager Bill Ackman responded with a similar argument, stating that he thinks such a move would be a mistake.
