Israel and Hezbollah reach cease-fire | The Excerpt
On Wednesday’s episode (first published on November 27, 2024) of The Excerpt podcast: Israel and Hezbollah have reached a cease-fire agreement. Paste BN National Immigration Reporter Lauren Villagran discusses the response in Mexico after President-elect Donald Trump's tariff threats. Elon Musk and Vivek Ramaswamy push for federal workers to return to the office. Millions of Americans could have expanded Medicare and Medicaid to cover blockbuster weight loss drugs. Paste BN Reporter Andrea Riquier discusses what this week's announcement by Fannie Mae and Freddie Mac means for the housing market.
Hit play on the player below to hear the podcast and follow along with the transcript beneath it. This transcript was automatically generated, and then edited for clarity in its current form. There may be some differences between the audio and the text.
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Taylor Wilson:
Good morning. I'm Taylor Wilson, and today is Wednesday, November 27th, 2024. This is The Excerpt.
Today we look at the ceasefire between Israel and Hezbollah, plus what Mexico's president says about Trump's tariff threats. And Fannie and Freddie will back homes costing nearly a million dollars as prices surge.
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Israel and the Iran-backed Lebanese militant group, Hezbollah reached a ceasefire deal yesterday. The move brings a path to end a war that's killed thousands of people since it was first ignited by the Israel-Hamas War. Israeli approval paved the way for a ceasefire declaration by President Joe Biden and French President Emmanuel Macron, who brokered the deal in a joint statement. Biden announced the ceasefire in a speech yesterday from the White House Rose Garden.
President Joe Biden:
Over the next 60 days, the Lebanese Army and state security forces will deploy and take control of their own territory once again. Hezbollah terrorist infrastructure in Southern Lebanon will not be allowed to be rebuilt. And over the next 60 days, Israel will gradually withdraw its remaining forces and civilians, civilians on both sides will soon be able to safely return to their communities.
Taylor Wilson:
Biden added that this is designed to be a permanent cessation of hostilities. Israel launched an offensive in Lebanon in mid-September following months of tit-for-tat border attacks that started when Hezbollah attacked Israel in solidarity with Hamas and Palestinians in Gaza. Since then, Israel has killed more than 3000 people in Lebanon according to Lebanese health ministry figures. Over the past year, Hezbollah launched thousands of rockets at Northern Israel, forcing Israelis who live in communities there to flee south.
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Officials in China, Mexico, and Canada are criticizing a pledge made by President-elect Donald Trump on social media to impose new tariffs on all three of the United States' largest trading partners on the first day of his presidency. Trump said he would sign an executive order immediately after his inauguration introducing a 25% tariff on all goods coming from Mexico and Canada, and a 10% tariff on goods from China. I caught up with Paste BN National Immigration Reporter Lauren Villagran for a look at possible tariffs on Mexico and the response south of the border. Lauren, thanks for making some time here.
Lauren Villagran:
Thanks, Taylor.
Taylor Wilson:
So Lauren, what has Donald Trump threatened when it comes to tariffs?
Lauren Villagran:
Throughout the campaign, former President and now President-elect, Donald Trump repeatedly said that he would threaten both China and Mexico with heavy tariffs if their governments didn't give him what he wanted, which is action on the trafficking of illegal drugs like the precursors to fentanyl and fentanyl itself, as well as in the case of Mexico, action on migration through the territory.
Taylor Wilson:
So what are we hearing out of Mexico regarding this, especially this week?
Lauren Villagran:
Yesterday, Mexico President Claudia Sheinbaum Pardo spoke in her daily news conference as she usually does in the morning, but she started by reading aloud a letter that she said she was going to send to President-elect Trump, and she had some very sharp words. It was uncharacteristically almost sarcastic in some parts of it, saying that she wasn't sure if he realized, for example, that Mexico was already doing a lot of work in stemming the flow of migrants to the US border. What is true about that, Taylor, is that Mexico has been engaged in a year-long crackdown on migration through its territory and migrant encounters at the US border have fallen as a result, but Mexico is in a difficult position here.
Taylor Wilson:
So Lauren, you and I have talked about this really in recent months, but how has Mexico taken a holistic approach to migration in recent years as President Sheinbaum Pardo alluded to?
Lauren Villagran:
Yeah, well, what the President called it is a politica integral, which is loosely translated as a holistic approach to migration, but it's sort of a euphemism, Taylor. What we have seen in Mexico over the past year is what experts call a carousel policy where they'll pick up migrants, detain them briefly, and then ship them back south, not to their countries of origin always, but just farther south in Mexico. So they have to make the journey again, really slowing migrants down on their way north. We've heard reports from migrants throughout the year about being shaken down by Mexican authorities, being targeted by criminal organizations and thieves along the way. It's been a policy that has been controversial, but that has had the effect of keeping migrants on the whole away from the US southern border.
Taylor Wilson:
Lauren, in terms of the broader issues here, I mean, how big a trading partner is Mexico and what would a theoretical trade war between the two countries actually mean for both players?
Lauren Villagran:
Well, there's no indication we're going to get to a full-blown trade war, but the stakes are huge. Mexico is the United States' largest trading partner. Mexico sends 80% of its exports to the United States. So it's heavily dependent on US consumers, but really more to the point, Taylor, is when you talk about the US slapping tariffs on Mexican goods or Mexico or retaliating with a tariff of its own, it's really like both countries shooting their own selves in the foot. When you look at products that reach the United States like a car, for example, some auto parts will crisscross the US/Mexico border seven or eight times as value and parts are added before they're placed in a vehicle at an assembly plant in the US Midwest. So we're talking about more than 30 years of a established trade relationship. But it's also important to note that President-elect Trump has been known for his bluster. He's been known to threaten tariffs in order to exact concessions from folks at the negotiating table and Mexico's in for a rough ride.
Taylor Wilson:
All right, Lauren Villagran covers the border and immigration for Paste BN. Thank you, Lauren.
Lauren Villagran:
Thanks, Taylor.
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Taylor Wilson:
The return to office debate continues. And while President-elect Donald Trump plans his return to the Oval Office, the leaders of his newly proposed Department of Government Efficiency are telling federal workers to return to their own. Tapped to lead the department also known as DOGE, Elon Musk and Vivek Ramaswamy laid out plans in a Wall Street Journal opinion piece for large scale firings, cuts to government spending, and an end to remote work for federal employees. In the piece, the pair addressed arguments that civil service protections could prevent Trump's second administration from trimming the amount of people on the government's payroll. They cited a statute allowing the President to prescribe reductions in force as long as he does not target specific employees. Musk and Ramaswamy are hoping a broad return to office mandate could be another way to thin out the federal workforce as employees have shown they will quit over such requirements. You can read more with a link in today's show notes.
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Millions of Americans could have expanded Medicare and Medicaid to cover blockbuster weight loss drugs. That's under a proposed federal rule announced yesterday. The medications part of a class of drugs called GLP1 were first used to treat diabetes, but have since been approved for obesity and dramatically expanding the patient pool. The drugs reduce people's appetite helping them lose weight. The new rule by the Biden administration seeks to broaden access. About 42% of American adults are obese according to the CDC, up from 30% from 1999 to 2000. If finalized, the rule would take effect in 2026, but it's unclear how the Trump administration will handle the proposal. Trump's pick to lead health and human services, Robert F. Kennedy Jr. has not been keen on weight loss drugs and said Americans should just eat better.
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Rising prices mean government-sponsored enterprises Fannie Mae and Freddie Mac will back bigger mortgages on homes costing nearly a million dollars as prices surge. I spoke with Paste BN Reporter Andrea Riquier for more. Andrea, thank you so much for hopping on today.
Andrea Riquier:
Hey, Taylor. Thanks for having me.
Taylor Wilson:
So let's just start here, Andrea. First off, what are Fannie Mae and Freddie Mac and what did they announce this week?
Andrea Riquier:
Fannie Mae and Freddie Mac are two companies that play a very important role in the mortgage system in housing finance. When you go to a bank or some other lender to get a mortgage like Quicken Loans for example, almost always that financial institution cannot make a loan for 30 years. It's just impossible for a bank to say, "30 years, we know what the interest rate is going to be." If you just think back over the past couple years, interest rates for mortgages, for example, were down almost to the twos just a couple of years ago, and now they're almost at 7%. So if you're a financial institution and you have thousands of mortgages, you know how important it is to be able to hedge that risk. So Fannie and Freddie buy mortgages from banks. Your bank will basically make you the loan and then turn around and sell it to this giant company that's sort of backed by the US government.
It's the only way mortgage finance works. So with all that in mind, Fannie and Freddie have certain rules that banks have to conform with in order for Fannie and Freddie to then buy the mortgage. Banks can't lend to people who have really bad credit, for example. They can't lend on houses that don't exist or are in really, really crappy condition. That's why you may have to get an inspection or an appraisal as part of the process. And so every year, Fannie and Freddie have to decide how much the loan limits are going to be, how high of a mortgage price they can take. And so basically on Tuesday, like they do every year, they've raised the limit because home prices have gone up. According to their calculations from the third quarter of last year to the third quarter of this year, home prices went up a little over 5%. And so the top range of the mortgages that they will buy or guarantee also went up 5%. So that's Fannie and Freddie in a nutshell.
Taylor Wilson:
Well, it's a good explainer. In terms of what they're doing this week, Andrea, I mean, what are they responding to and what does this tell us about the state of the housing market?
Andrea Riquier:
We know that home prices are expensive to begin with, and the point that I made in my piece today was that if home prices overall are up 5%, it's a good idea to raise the loan limits 5%, but that doesn't speak to the cost of the home. So on an $800,000 mortgage, which is the outer limit for what Fannie and Freddie will buy next year, you're basically talking about a million dollar home and it gives people pause to think about that being the norm right now for Fannie and Freddie.
Taylor Wilson:
In terms of other solutions out there for folks, just thinking ahead, thinking how will I ever be able to get into this housing market, what other solutions are out there to make housing more affordable?
Andrea Riquier:
Yeah, I mean, I've written a lot about really unconventional ways to buy a home, for example, becoming a landlord, buying a duplex or a three flex, renting some of it out. Just buying real fixer uppers. Other than the real unconventional ways of buying property, there's not a lot of good solutions out there. Mortgage rates continue to tick up as a lot of people expected. They're basically closing back in on 7% and we had a good month for home sales in October, but the median home price across the country is now just over $400,000. And that's a big number.
Taylor Wilson:
That's a huge number. So I know you don't have a crystal ball, Andrea, but I'm going to ask you to predict a little bit. What are we thinking for 2025? What's next for home prices?
Andrea Riquier:
So coming into what's traditionally been called the spring selling season, if mortgage rates are as high as they are now or possibly even higher, which some people think they could be, we probably won't see a ton of activity. That just means that there aren't as many people who want to list their home for sale, and there just isn't a strong surge of things to buy for people who want to. If mortgage rates remain elevated around 7%, it may keep a lid on home price growth, but that doesn't really matter if there's not much to buy.
Taylor Wilson:
All right. Andrea Riquier with a great breakdown for us as always. Listeners can check out the full piece with a link in today's show notes. Andrea, thanks so much.
Andrea Riquier:
Thanks, Taylor.
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Taylor Wilson:
The tragic death of 31-year-old One Direction star Liam Payne earlier this year after falling from the balcony of a hotel in Buenos Aires has led some to question how young is too young for international startup. UCLA's Dr. Adi Jaffe, a psychologist who specializes in addiction joins my colleague Dana Taylor later today to discuss whether it is reasonable to expect young people to be able to handle the psychological challenges associated with extreme fame. That episode airs beginning at 4 PM Eastern Time today, right here on this feed.
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And thanks for listening to The Excerpt. You can get the podcast wherever you get your pods. And if you're on a smart speaker, just ask for The Excerpt. I'm Taylor Wilson, and I'll be back tomorrow with more of The Excerpt from Paste BN.