Trump's 50-Year vs FDR's 30-Year Mortgage: Why Bigger Isn't Better | Between The Lies 015

Trump just announced 50-year mortgages to "fix" the housing crisis. His logic? If FDR's 30-year mortgages were good, then 50-year mortgages must be better. Bigger number equals better, right?

Wrong.

In this episode, Luke Tatum and Rob Brayton from Perfect Spiral Capital break down the mathematical reality behind Trump's latest intervention. The numbers are brutal: After 10 years of payments on a 50-year mortgage, 93% of your money goes to interest. You'd have just 7% equity in your home.

You don't hit the 50/50 point—where your payment is equally split between principal and interest—until year 39. Most Americans move every 7-8 years. They'd build essentially zero equity.

But the real issue isn't just the mortgage product itself. It's why we need it in the first place. Rob explains how decades of monetary policy, deficit spending, and inflation have driven asset prices through the roof. Houses aren't just expensive because of supply and demand—they're expensive because of deliberate government intervention at every level.

From minimum square footage requirements that prevent affordable starter homes to BlackRock using cheap government money to buy up real estate while families get priced out, the system is rigged from multiple angles. This isn't capitalism—it's crony capitalism on steroids.

Luke reminds us that when he was born, mortgage rates were 8.5% but people could afford houses. Today rates are lower, but homes are unaffordable. That tells you everything about who benefits from "easy money."

As Rob points out, 50-year mortgages are just another intervention following previous interventions. When you prop up one part of the economy, it distorts economic signals and creates new problems. Then you need another intervention to fix those problems. It's economic flex tape slapped on a rotten subfloor.

The comparison to 2008 is unavoidable. Fannie Mae just eliminated its 620 FICO score minimum to guarantee riskier mortgages. Combine that with 50-year terms and easier lending standards, and you've got all the ingredients for another housing bubble disaster.

But here's the positive takeaway: Economic downturns create massive opportunities for people with capital ready to deploy. Luke shares how he and his wife made a pact after 2008 to never get caught flatfooted again. How many millionaires were made during the recovery? A whole hell of a lot—because they had liquidity when assets were on sale.

That's what Perfect Spiral Capital does. They help individuals and business owners get properly capitalized so when opportunities appear, you can act on them. While others panic about government policy, you'll have dry powder ready to deploy.

Capital attracts opportunities. The question is: Will you be ready when they arrive?

Ready to make sure you're never caught flatfooted by economic chaos? Visit PerfectSpiralCapital.com/podcast for their free toolkit on building wealth that survives government incompetence.