(Bloomberg) -- Tom Barrack, who a week ago warned that commercial real estate financing was on the brink of collapse because of the coronavirus pandemic, is now calling for a moratorium on margin calls and intervention by the Federal Reserve to keep values of mortgage debt from plummeting further.

“America needs the immediate cooperation and support from our banking sector,” Barrack, chairman and chief executive officer of Colony Capital Inc., said in a white paper he posted on Medium.

The threat of widespread defaults has caused waves of selling in the market for commercial mortgage-backed securities. Banks in turn are demanding cash and seizing collateral from vehicles that borrowed to invest in CMBS and other forms of asset-backed debt, a practice that drives down prices even further. One index of mortgage REITs, or real estate investment trusts, has collapsed by more than 50%, in part because of those margin calls.

Barrack argues that JPMorgan Chase & Co., Wells Fargo & Co. and other lenders can halt the downdraft by granting forbearance on repurchase, or repo, financing to CMBS investors. At stake, he said, are trillions of dollars in securities owned by insurers, asset managers, pension funds -- even banks themselves.

If the investment vehicles get such relief, they can subsequently grant forbearance to the hotels, retailers, malls and other tenants and borrowers who can’t pay rent or interest while the economy is largely shut down because of the pandemic, Barrack said.

Barrack is a longtime friend of President Donald Trump and Treasury Secretary Steve Mnuchin, and the second part of his “call to action” involves the government. He wants the Federal Reserve to use part of the $2 trillion stimulus bill signed into law on Friday to establish special-purpose vehicles with the capacity to buy non-agency CMBS and repo collateral.

That would “set a floor to the entire debt stack and stabilize values across securitized and non-securitized debt and equity markets,” he said, adding that the SPVs could be capitalized by money from the Treasury Department or private investors.

He also repeated his suggestions last week that regulators waive a number of accounting and capital rules for banks during the coronavirus crisis.

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