Mortgage rates are approaching 7% as the <a href="http://dailywire.com/topic/housing" target="_blank" rel="noopener">housing</a> market continues to experience turmoil.
The 30-year fixed mortgage rate remained below 3% for much of the past two years, according to <a href="https://fred.stlouisfed.org/series/MORTGAGE30US" target="_blank" rel="noopener">data</a> from government-backed mortgage company Freddie Mac. Since the beginning of the year, however, the rate has surged from just over 3% and reached 6.29% as of last week — marking a 0.25% increase from the preceding week alone.
“The housing market continues to face headwinds as mortgage rates increase again this week,” Freddie Mac Chief Economist Sam Khater said in a <a href="https://freddiemac.gcs-web.com/news-releases/news-release-details/30-year-fixed-rate-mortgage-increased-quarter-percent-week" target="_blank" rel="noopener">press release</a> last week. “Impacted by higher rates, house prices are softening, and home sales have decreased. However, the number of homes for sale remains well below normal levels.”
Contributing to the soaring mortgage rates are actions from the Federal Reserve to <a href="https://www.dailywire.com/news/heres-what-the-federal-reserves-recent-rate-hike-means-for-the-economy" target="_blank" rel="noopener">raise</a> the target federal funds rate by 0.75%, a move which followed two identical hikes in June and July, in an attempt to relieve elevated inflationary pressures. The policy provoked a stock market <a href="https://www.dailywire.com/news/if-hes-elected-the-stock-market-will-crash-trumps-2020-warning-about-biden-comes-true" target="_blank" rel="noopener">selloff</a>.
Mortgage applications have therefore fallen 3.7% in a single week, according to <a href="https://www.mba.org/news-and-research/newsroom/news/2022/09/28/mortgage-applications-decrease-in-latest-mba-weekly-survey" target="_blank" rel="noopener">data</a> from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey. The portion of mortgage activity attributable to refinancing dropped from 32.5% to 30.2%.
Meanwhile, the National Association of Realtors’ Pending Home Sales Index fell 2% in August and 24.2% year-over-year. &#8220;The direction of mortgage rates — upward or downward — is the prime mover for home buying, and decade-high rates have deeply cut into contract signings,&#8221; National Association of Realtors Chief Economist Lawrence Yun remarked in a <a href="https://www.nar.realtor/newsroom/pending-home-sales-dropped-2-0-in-august" target="_blank" rel="noopener">statement</a>. &#8220;If mortgage rates moderate and the economy continues adding jobs, then home buying should also stabilize.&#8221;
In the second quarter of 2022, the median sale price of a home in the United States was $440,300, according to <a href="https://fred.stlouisfed.org/series/MSPUS" target="_blank" rel="noopener">data</a> from the Department of Housing and Urban Development, marking a 36% rise from $322,600 in the second quarter of 2020. Home prices are <a href="https://www.dailywire.com/news/home-prices-mortgage-rates-expected-to-stay-elevated-through-next-year" target="_blank" rel="noopener">expected to increase</a> another 4% in 2023 — a relative slowdown from 17.8% in 2021 and 12.8% in 2022.
The western portion of the United States has witnessed the most severe slowdown in purchase activity amid the high prices, with the region’s Pending Home Sales Index falling year-over-year by 31.3%. &#8220;Home prices are the least affordable in the West and, consequently, the region suffered deeper annual declines in contract signings due to rising interest rates when compared to other areas of the country,&#8221; Yun added. &#8220;However, the recent increases of the last two months, though small, are encouraging.&#8221;
The pressures in the housing market are also <a href="https://www.dailywire.com/news/rental-market-remains-brutal-nationwide-cools-in-some-large-cities" target="_blank" rel="noopener">impacting conditions</a> in the rental space, particularly in large cities on the west coast. In Seattle, Washington, expensive real estate is compelling would-be homebuyers to search for apartments, prompting the city council to unanimously greenlight a special election that will determine whether officials should create more affordable housing, as detailed in an <a href="https://www.zumper.com/blog/rental-price-data/" target="_blank" rel="noopener">analysis</a> from Zumper.
Six of the 10 cities with the most expensive rental rates for one-bedroom apartments are located in California. Although the national average for one-bedroom rent reached $1,503 in September, some rental markets — such as San Jose, California; Miami, Florida; and Nashville, Tennessee — saw moderate month-over-month decreases in average one-bedroom rent.

Houses on suburban block, Apopka, Florida

Mortgage Rates Near An Astonishing 7%

Mortgage Rates Climb Near 7% As Housing Market Sees Turmoil

Economy

Federal Reserve

Housing

Inflation

Interest Rates

<a href="http://dailywire.com/topic/housing" target="_blank" rel="noopener">Rental</a> costs are continuing to rise across the United States, with some large cities posting decreases in median one-bedroom rent.
According to a <a href="https://www.zumper.com/blog/rental-price-data/">report</a> released on Tuesday by rental platform Zumper, national one-bedroom rent reached $1,503 in September — a figure that reached its ninth high for the ninth consecutive month. Rent is now $1,845 for two-bedroom apartments, indicating another all-time high. However, some metropolitan areas — such as San Jose, California; Miami, Florida; and Nashville, Tennessee — saw moderate month-over-month decreases in average one-bedroom rent.
“The rental market has been very supply constrained for the past five quarters, but there has been a significant shift back towards equilibrium in the past quarter,” Zumper CEO Anthemos Georgiades explained in a press release provided to The Daily Wire. “Occupancy rates and the pace of rent increases are now falling in many major metros, as renter demand softens and fear of recession kicks in, with many renters deciding to stay put or trade down on the most expensive options.”
Meanwhile, cities such as San Francisco, California; Boston, Massachusetts; and Anaheim, California, continued to see rising month-over-month prices for one-bedroom apartments.
The most expensive city in the nation for renters is New York City, where residents pay an average of $3,950 for a one-bedroom unit — a rate that has increased nearly 34% over the past year. The Big Apple is followed by San Francisco and Boston, where rent is $3,100 and $2,890, respectively.
According to Zumper, many metropolitan areas are contending with low availability of housing units. In Seattle, Washington, a competitive housing market is driving would-be homebuyers to search for apartments, prompting the city council to unanimously greenlight a special election that will determine whether officials should create more affordable housing.
Last week, the Federal Reserve <a href="https://www.dailywire.com/news/heres-what-the-federal-reserves-recent-rate-hike-means-for-the-economy">raised</a> the target federal funds <a href="https://www.dailywire.com/topic/interest-rates">rate</a> 0.75% — a move which followed two identical hikes in June and July — in an attempt to relieve elevated inflationary pressures. The actions have contributed to mortgage rates surpassing 6%, according to <a href="https://fred.stlouisfed.org/series/MORTGAGE30US">data</a> from government-backed mortgage company Freddie Mac.
“Impacted by higher rates, house prices are softening, and home sales have decreased,” Freddie Mac Chief Economist Sam Khater said in a <a href="https://freddiemac.gcs-web.com/news-releases/news-release-details/30-year-fixed-rate-mortgage-increased-quarter-percent-week?_ga=2.218209497.1115799685.1664299903-1989272781.1664299903">press release</a>. “However, the number of homes for sale remains well below normal levels.”
In the second quarter of 2022, the median sale price of a home in the United States was $440,300, according to <a href="https://fred.stlouisfed.org/series/MSPUS">data</a> from the Department of Housing and Urban Development, marking a 36% rise from $322,600 in the second quarter of 2020. Home prices are <a href="https://www.dailywire.com/news/home-prices-mortgage-rates-expected-to-stay-elevated-through-next-year">expected to increase</a> another 4% in 2023 — a relative slowdown from 17.8% in 2021 and 12.8% in 2022.
The high prices have produced a slowdown in home purchases, with the National Association of Home Builders&#8217; Housing Market Index <a href="https://www.dailywire.com/news/united-states-enters-housing-recession">falling</a> last month to its lowest level in the past two years.
Younger American renters have been particularly impacted by the tight real estate market. An <a href="https://www.dailywire.com/news/half-of-millennials-cant-afford-to-rent-a-one-bedroom-apartment-in-californias-biggest-cities">analysis</a> from Filterbuy showed that at least half of Millennials, defined by the company as those between 24 and 39 years old, cannot afford a one-bedroom apartment in many major American cities. For the area surrounding Los Angeles, California, median wages are $36,649, while the annual wage required to affordably rent a one-bedroom apartment is $72,560.

Classic residential buildings in midtown upper Manhattan

Rental Market Remains Brutal Nationwide, Cools In Some Large Cities

Rent Payments Rise Nationwide, Stabilize Or Fall In Some Large Cities

Boston

New York City

Real estate

San Francisco

After finance professor Jeremy Siegel passionately argued on Friday that the <a href="http://dailywire.com/topic/federal-reserve" target="_blank" rel="noopener">Federal Reserve</a> has neglected to maintain an even hand with monetary policy, Tesla and SpaceX CEO <a href="http://dailywire.com/topic/elon-musk" target="_blank" rel="noopener">Elon Musk</a> concurred that the central bank’s policies do not make sense.
Policymakers at the central bank increased the target federal funds <a href="https://www.dailywire.com/topic/interest-rates" target="_blank" rel="noopener">rate</a> by 0.75% on Wednesday afternoon, sending the Dow Jones Industrial Average <a href="https://www.dailywire.com/news/federal-reserve-announces-rate-hike-of-0-75">tumbling</a> more than 500 points. After stagnating on Thursday, the index fell another 900 points by early Monday afternoon to reach 29,300.
The Federal Reserve had initially <a href="https://www.dailywire.com/news/federal-reserve-releases-plan-to-more-urgently-address-high-inflation">pegged</a> a near-zero target interest rate and acquired government bonds in order to stimulate the economy during the lockdown-induced recession. During an <a href="https://www.cnbc.com/video/2022/09/23/powells-decision-overlooks-monetary-and-financial-indicator-argues-wharton-prof-jeremy-siegel.html">interview</a> with CNBC, the United of Pennsylvania Wharton School professor acknowledged he was “very upset” and said the Federal Reserve’s sudden hawkishness makes “absolutely no sense.&#8221;
“It’s like a pendulum. They were way too easy… through 2020, 2021,” Siegel said, observing that no members of the media were willing to ask Federal Reserve Chair Jerome Powell tough questions during the most recent rate hike announcement. “And now… ‘We’re going to be real tough guys until we crush the economy’ … Poor monetary policy would be an understatement.”
The M1 money supply, which includes liquid forms of money such as demand deposits and checking accounts, rose from $4.8 trillion to $16.2 trillion between April 2020 and May 2020 alone, according to <a href="https://fred.stlouisfed.org/series/M1SL">data</a> from the Federal Reserve. The metric peaked at $20.7 trillion in March 2022 and has since fallen slightly.
Musk, who <a href="https://www.dailywire.com/news/elon-musk-has-a-super-bad-feeling-about-the-economy-wants-a-massive-layoff-at-tesla">said</a> three months ago that he has a “super bad feeling” about the economy, commented on <a href="https://twitter.com/elonmusk/status/1573624036957065217">social media</a> that Siegel is “obviously correct.”
The rollback of the monetary stimulus occurs as inflation rises at the fastest rate in four decades. Price levels between August 2021 and August 2022 rose 8.3%, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, marking a slight moderation from an 8.5% year-over-year increase in July and a 9.1% year-over-year increase in June.
Central bankers, who also increased interest rate targets by 0.75% in June and July, have indeed pivoted in recent months toward an aggressive tone. “Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” Powell asserted at a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">speech</a> last month. “Without price stability, the economy does not work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all.”
During a separate CNBC <a href="https://www.cnbc.com/2022/09/26/whartons-siegel-says-jerome-powell-owes-the-american-people-an-apology-for-poor-fed-policy.html">interview</a>, Siegel argued that Powell “should offer the American people an apology” for the “poor monetary policy” which marked the past few years. “It seems to me wrong for Powell to say we’re going to crush wage increases, we’re going to crush the worker, when that is not the cause of the inflation,” he said. “The cause of the inflation was excessive monetary accommodation.”
A relative bright spot in an otherwise bleak economic landscape has been the labor market, which is maintaining unemployment rates well below historic norms. Yet <a href="https://www.dailywire.com/news/unemployment-rate-edges-upward-for-the-first-time-in-months-as-more-americans-return-to-work">joblessness rose</a> last month to 3.7% even as more Americans returned to work, according to a <a href="https://www.bls.gov/news.release/empsit.nr0.htm">release</a> from the Bureau of Labor Statistics.

Collage Maker-26-Sep-2022-05.31-PM

Elon Musk Agrees With A Furious Jeremy Siegel That Fed Actions Which Blew Up The Stock Market Make ‘Absolutely No Sense’

Elon Musk And Jeremy Siegel Agree: Federal Reserve Approach To Inflation Makes 'Absolutely No Sense'

Elon Musk

Stock Market

Carl Icahn, the chair of hedge fund Icahn Enterprises, warned last week that <a href="http://dailywire.com/topic/inflation" target="_blank" rel="noopener">inflation</a> in the United States is comparable to the monetary phenomena that contributed to the fall of the Roman Empire.
Price levels between August 2021 and August 2022 rose 8.3%, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, marking a slight moderation from an 8.5% year-over-year increase in July and a 9.1% year-over-year increase in June. The <a href="http://dailywire.com/topic/federal-reserve" target="_blank" rel="noopener">Federal Reserve</a> responded on Wednesday by <a href="https://www.dailywire.com/news/heres-what-the-federal-reserves-recent-rate-hike-means-for-the-economy">increasing</a> the target federal funds rate by 0.75% — a move that caused a stock market <a href="https://www.dailywire.com/news/federal-reserve-announces-rate-hike-of-0-75">selloff</a> and mirrored identical aggressive rate hikes in June and July.
During an <a href="https://www.marketwatch.com/story/carl-icahn-to-investors-the-worst-is-yet-to-come-11663795164">interview</a> with MarketWatch, Icahn pointed to the central bank’s quantitative easing regime over the past two years as the key impetus for soaring inflation and warned that “the worst is yet to come.”
“We printed up too much money, and just thought the party would never end,” remarked Icahn, who worked as a special regulatory reform adviser during the Trump administration.
To encourage business and consumer activity during the lockdown-induced recession, the Federal Reserve had <a href="https://www.dailywire.com/news/federal-reserve-releases-plan-to-more-urgently-address-high-inflation">pegged</a> a near-zero target interest rate and acquired bonds from the market. The rollback of the monetary stimulus occurs as price levels rise at the fastest rate in four decades.
“Inflation is a terrible thing. You can’t cure it,” Icahn added, observing that rapidly rising price levels led to the collapse of the Roman Empire. “You can’t get that genie back in the bottle too easily.”
In addition to political turmoil and military conflict, the period between 200 AD and 300 AD saw multiple currency devaluations, with prices rising nearly 1,000% between 258 AD and 275 AD alone, according to a <a href="https://mises.org/library/inflation-and-fall-roman-empire">lecture</a> from Baruch College history professor Joseph Peden. The last Western Roman emperor was deposed by Germanic barbarian forces in 476 AD.
However, policymakers have sought to convince market actors that the Federal Reserve is serious about curbing inflation. During a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">speech</a> at the central bank’s symposium in Jackson Hole, Wyoming, Federal Reserve Chair Jerome Powell said that officials are prepared to “bring some pain” to combat rising price levels and return inflation to the long-term target of 2%.
“Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” he asserted. “Without price stability, the economy does not work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all.”
The central bank’s newfound hawkishness has provoked criticism from other experts. Steve Forbes, the chair of Forbes Media and editor-in-chief of Forbes Magazine, argued on Monday that monetary policymakers do not need to <a href="https://www.dailywire.com/news/steve-forbes-reveals-the-key-tool-officials-are-not-wielding-against-inflation">dampen the economy</a> in order to fight inflation. “No central banker today — hardly any — talks about stable currencies. It’s about depressing the economy to fight inflation,” Forbes remarked. “With unstable currencies you get less productive long-term investments, which is key to economic growth.”
Lawrence Summers, who led the Treasury Department and the National Economic Council during the Clinton and Obama administrations, said that policymakers will <a href="https://www.dailywire.com/news/a-serious-inflation-problem-top-obama-economist-sounds-the-alarm-over-prices-as-white-house-celebrates">likely fail</a> at curbing inflation without increases in joblessness. “Core inflation is higher this month than for the quarter, higher this quarter than last quarter, higher this half of the year than the previous one, and higher last year than the previous one,” he said.

The Course Of Empire Destruction 1836

‘The Worst Is Yet To Come’: Top Hedge Fund Manager Compares American Inflation To The Fall Of Rome

Hedge Fund Manager Compares Fall Of Rome To American Inflation

Steve Forbes, the chair of Forbes Media and editor-in-chief of Forbes Magazine, argued on Monday that monetary policymakers are neglecting currency stabilization as a tool to combat <a href="http://dailywire.com/topic/inflation" target="_blank" rel="noopener">inflation</a>.
Price levels between August 2021 and August 2022 rose 8.3%, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, marking a slight moderation from an 8.5% year-over-year increase in July and a 9.1% year-over-year increase in June. The <a href="http://dailywire.com/topic/federal-reserve">Federal Reserve</a> responded on Wednesday by <a href="https://www.dailywire.com/news/heres-what-the-federal-reserves-recent-rate-hike-means-for-the-economy">increasing</a> the target federal funds rate by 0.75% — a move that mirrored identical aggressive rate hikes in June and July.
Raising interest rate targets has the effect of discouraging economic activity by increasing the cost of borrowing money. During the Forbes Global CEO Conference in Singapore, Forbes questioned the logic of sending the economy into a recession in order to reduce inflationary pressures, according to a <a href="https://www.cnbc.com/2022/09/26/the-real-cure-for-inflation-has-gone-ignored-forbes-says.html">report</a> from CNBC.
“No central banker today — hardly any — talks about stable currencies. It’s about depressing the economy to fight inflation,” he remarked. “With unstable currencies you get less productive long-term investments, which is key to economic growth.”
Currency appreciation leads to more costly exports for overseas buyers, according to an <a href="https://www.imf.org/external/pubs/ft/fandd/basics/monpol.htm">analysis</a> from the International Monetary Fund. The dollar has appreciated rapidly against foreign currencies <a href="https://www.dailywire.com/news/global-turmoil-makes-euro-cheap-for-americans">such as the euro</a> amid the repeated interest rate hikes, decreasing demand for American products and lowering economic output.
“Today, unfortunately, not only is the Biden administration putting up obstacles to deal with supply-side problems, but also the Federal Reserve and other central banks think you have to depress the economy to bring inflation down,” Forbes added. “The real cure is to stabilize the currency. You don’t have to make people poor to conquer inflation.”
Forbes cited former President Ronald Reagan’s efforts to bolster American reserves of foreign currencies — a move that increases the supply of the dollar on foreign exchange markets, thereby decreasing exchange rates. Unpredictable exchange rates also increase currency risks for overseas investors, leading to less foreign direct investment into the United States.
Forbes, who ran for the Republican presidential nomination in 1996 and 2000, likewise suggested a return to the gold standard. “Gold holds its intrinsic value better than anything else on earth… gold is not perfect as a stable value, but it is better than anything we have found in over 4,000 years,” he explained.
To stimulate the economy during the lockdown-induced recession, the Federal Reserve had initially <a href="https://www.dailywire.com/news/federal-reserve-releases-plan-to-more-urgently-address-high-inflation">pegged</a> a near-zero target interest rate and acquired government bonds from the market. The rollback of the stimulus from policymakers occurs as price levels rise at the fastest rate in four decades.
Federal Reserve Chair Jerome Powell said during a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">hawkish speech</a> at the central bank’s symposium in Jackson Hole, Wyoming, that officials are prepared to “bring some pain” to combat rising price levels and return inflation to the long-term target of 2%. “Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” he asserted. “Without price stability, the economy does not work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all.”
The Dow Jones Industrial Average, which tracks 30 of the most prominent companies on American exchanges, <a href="https://www.dailywire.com/news/federal-reserve-announces-rate-hike-of-0-75">tumbled</a> more than 500 points after the Federal Reserve hiked interest rate targets last week.

2019 Forbes Healthcare Summit

Steve Forbes Reveals The Key Tool Officials Are Not Wielding Against Inflation

Steve Forbes Wants Stable Currencies To Fight Inflation

Forbes

Recession

Atlanta Federal Reserve Bank President and CEO Raphael Bostic said Sunday that the country needs economic pain now to avoid even more pain later.
Appearing on CBS&#8217;s &#8220;<a href="https://www.cbsnews.com/video/atlanta-fed-chief-says-central-bank-working-to-avoid-deep-deep-pain/">Face The Nation,</a>&#8221; Bostic said that in order to rein in sky-high inflation, the Federal Reserve needs to rein in economic demand. To do that, it needs to tighten monetary policy, which he acknowledged would inevitably slow the economy down further. But he said dragging the economy down will mean job losses and economic pain, and that pain is necessary to avoid worse pain later on.
&#8220;[I]nflation is high. It&#8217;s too high,&#8221; Bostic told host Margaret Brennan. &#8220;And we really need to do all that we can to make it come down. And when we think about its source, it&#8217;s because we have very high demand.&#8221;
&#8220;We have not enough supply,&#8221; he continued. &#8220;[W]hat we were hoping would happen is that we&#8217;d see some movement on the supply side, to move the supply up so that there wasn&#8217;t so much of an auction on goods that are in the marketplace. But that hasn&#8217;t happened. And that really has meant that we have had to turn to our policies to try to take demand down.&#8221;
Bostic dismissed concerns that the U.S. is already in a recession after two consecutive quarters of negative GDP growth, and claimed that the economy was &#8220;still creating lots of jobs on a monthly basis.&#8221;
He said the economy still has to slow down, &#8220;[b]ut I do think that we&#8217;re going to do all that we can at the Federal Reserve to avoid deep, deep pain. And I think there are some scenarios where that&#8217;s likely to happen.&#8221;
&#8220;It&#8217;s not going to be easy,&#8221; Bostic continued. &#8220;There will likely be some job losses. But I think if you look over the historical history here and our economic experiences, there&#8217;s a really good chance that if we have job losses, it&#8217;s going to be smaller than what we&#8217;ve seen in other situations. And that&#8217;s what I&#8217;m banking on.&#8221;
Bostic&#8217;s comments come as the Federal Reserve <a href="https://www.dailywire.com/news/federal-reserve-announces-rate-hike-of-0-75" target="_blank" rel="noopener">increased interest rates</a> by another 75 basis points, or 0.75%, last week. The news sent the stock market tumbling on Wednesday; the Dow Jones Industrial Average closed below 30,000 on Friday, plunging to the <a href="https://www.cnn.com/2022/09/23/investing/dow-stock-market-today/index.html">lowest level since 2020</a> and sitting on the edge of bear market territory. Moreover, the Atlanta Fed projected the economy would <a href="https://www.dailywire.com/news/american-economy-shrank-in-the-first-two-quarters-and-will-likely-stagnate-in-the-third" target="_blank" rel="noopener">stagnate</a> in the third quarter; the Bank&#8217;s GDPNow tracker predicts just 0.3% annualized GDP growth in the third quarter of 2022.

Federal Reserve Bank Of Atlanta President Raphael Bostic Speaks During The APPAM Research Conference

Atlanta Fed Chief: U.S. Economy Needs To Feel Pain Of Recession Now To ‘Avoid Deep, Deep Pain’ Later

Atlanta Fed Chief: U.S. Economy Needs To Feel Pain Of Recession Now To 'Avoid Deep, Deep Pain' From Inflation Later

Face The Nation

The <a href="http://dailywire.com/topic/federal-reserve" target="_blank" rel="noopener">Federal Reserve</a> raised the federal funds <a href="https://www.dailywire.com/topic/interest-rates" target="_blank" rel="noopener">rate</a> 0.75% on Wednesday afternoon, sending the Dow Jones falling more than 500 points.
As <a href="http://dailywire.com/topic/inflation" target="_blank" rel="noopener">inflation</a> remains elevated and core inflation — the price level increase for all items except for food and energy — continues to rise, the central bank’s decision signals that officials are prioritizing a cooldown in cost pressures, even with potential declines in economic activity. Officials also <a href="https://www.dailywire.com/news/federal-reserve-hikes-interest-rates-again-to-combat-bidenflation">announced</a> rate hikes of 0.75% in June and July.
The Federal Reserve cited robust employment figures as a rationale for the rate hike — although joblessness could see substantial increases under the aggressive rollback of monetary stimulus, Kace Capital Advisors CEO Kenny Polcari said in an interview with The Daily Wire.
“Expect the unemployment rate to go from 3.7% — where it is right now — to probably approaching 5% before this is over,” he remarked. “We could see an unemployment rate go to 6%. That would be very, very difficult considering where we are now.”
Indeed, a number of leading companies across multiple industries — including Meta, Bed Bath &amp; Beyond, Ford, and Goldman Sachs — have <a href="https://www.dailywire.com/news/major-retailer-will-lay-off-20-of-staff-close-150-stores">announced layoffs</a> this month. “Earning season starts in two weeks, the week of October 10,” Polcari added. “A lot of these companies that are now going to be faced with these very difficult decisions are going to pre-announce the fact that they&#8217;re going to miss their numbers. And they&#8217;re going to talk about restructuring — restructuring in this case means layoffs.”
Meanwhile, Federal Reserve Chair Jerome Powell announced a terminal federal funds rate — the level at which the rate will rest before the central bank reverses course — of 4.6%. “There&#8217;s going to be pressure coming to consumers and Americans from all kind of angles,” Polcari continued. “That&#8217;s what you should take away from what happened.”
To stimulate the economy after the lockdown-induced recession, the Federal Reserve had originally <a href="https://www.dailywire.com/news/federal-reserve-releases-plan-to-more-urgently-address-high-inflation">pegged</a> a near-zero target interest rate and purchased government bonds from the market. The aggressive rollback of the stimulus from monetary policymakers occurs as inflation rises at the fastest rate in four decades. Price levels between August 2021 and August 2022 rose 8.3%, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, marking a slight moderation from an 8.5% year-over-year increase in July and a 9.1% year-over-year increase in June.
Powell said during a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">hawkish speech</a> at the central bank’s recent symposium in Jackson Hole, Wyoming, that officials are willing to “bring some pain” in their efforts to combat rising price levels and return inflation to the long-term target of 2%.
“Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” he remarked. “Without price stability, the economy does not work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all. The burdens of high inflation fall heaviest on those who are least able to bear them.”
Americans now foresee lower short-term and medium-term inflation amid the aggressive rate hikes. Median one-year and three-year inflation expectations both saw steep declines last month, respectively from 6.2% and 3.2% in July to 5.7% and 2.8%, according to <a href="https://www.newyorkfed.org/microeconomics/sce#/">data</a> from the Federal Reserve Bank of New York.

Jerome Powell

Here’s What The Federal Reserve’s Recent Rate Hike Means For The Economy

Expect More Layoffs As The Federal Reserve Hikes Rates

Unemployment

The <a href="http://dailywire.com/topic/federal-reserve">Federal Reserve</a> announced raised the key federal funds <a href="https://www.dailywire.com/topic/interest-rates">interest rate</a> three-quarters of a point Wednesday afternoon, sending the Dow tumbling more than 500 points.
As inflation remains elevated and core inflation — the price level increase for all items except for food and energy — continues to rise, the central bank’s decision signals that officials are prioritizing a cooldown in cost pressures, even with potential declines in economic activity.
&#8220;Recent indicators point to modest growth in spending and production. Job gains have been robust in recent months, and the unemployment rate has remained low,&#8221; the Federal Reserve&#8217;s Board of Governors said in a <a href="https://www.federalreserve.gov/newsevents/pressreleases/monetary20220921a.htm">statement</a>. &#8220;Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures.&#8221;
Stocks, which had been up earlier in the day, closed down sharply, with the Dow dropping 522 points, or 1.7%, and the tech-heavy NASDAQ falling 205 points, or 1.8%.
Officials <a href="https://www.dailywire.com/news/federal-reserve-hikes-interest-rates-again-to-combat-bidenflation">announced</a> interest rate hikes of 0.75% in June and July — a move meant to discourage inflation by increasing the cost of borrowing money for businesses and consumers. To stimulate the economy after the lockdown-induced recession, the Federal Reserve had <a href="https://www.dailywire.com/news/federal-reserve-releases-plan-to-more-urgently-address-high-inflation">pegged</a> a near-zero target interest rate and purchased government bonds from the market.
Price levels between August 2021 and August 2022 rose 8.3%, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, marking a slight moderation from an 8.5% year-over-year increase in July and a 9.1% year-over-year increase in June. Federal Reserve Chair Jerome Powell said during a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">hawkish speech</a> at the central bank’s recent symposium in Jackson Hole, Wyoming, that policymakers are willing to “bring some pain” in their efforts to combat inflation and return price level changes to the long-term target of 2%.
“Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” he remarked. “Without price stability, the economy does not work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all. The burdens of high inflation fall heaviest on those who are least able to bear them.”
Powell also emphasized that the rising prices <a href="https://www.dailywire.com/news/ronald-reagans-carterflation-warnings-ring-true-under-bidenflation">seen</a> during the 1970s and early 1980s taught the Federal Reserve that it “can and should take responsibility for delivering low and stable inflation” despite the fact that other developed nations are witnessing the same phenomenon.
Americans now predict lower short-term and medium-term inflation amid the aggressive rate hikes. Median one-year and three-year inflation expectations both saw steep declines last month, respectively from 6.2% and 3.2% in July to 5.7% and 2.8%, according to <a href="https://www.newyorkfed.org/microeconomics/sce#/">data</a> from the Federal Reserve Bank of New York.
Despite the rising core inflation in August, President Joe Biden said in a <a href="https://www.whitehouse.gov/briefing-room/statements-releases/2022/09/13/statement-of-president-joe-biden-on-consumer-price-index-in-september/">statement</a> that the “essentially flat” prices are a sign that his economic agenda is effective.
“It will take more time and resolve to bring inflation down, which is why we passed the Inflation Reduction Act to lower the cost of healthcare, prescription drugs and energy,” the commander-in-chief argued. “And my economic plan is showing that, as we bring prices down, we are creating good paying jobs and bringing manufacturing back to America.”
The United States could experience additional inflationary pressures as the European Union endures an energy crisis, which has compelled factories to <a href="https://www.dailywire.com/news/european-companies-pause-production-as-energy-prices-soar">halt production</a> while wholesale prices for natural gas rise <a href="https://www.dailywire.com/news/european-climate-bureaucrats-are-dooming-the-continent-to-a-very-dark-winter">more than twentyfold</a> in some nations. Energy prices in the United States have likewise increased precipitously since Russia invaded Ukraine earlier this year.

U.S.-WASHINGTON, D.C.-FED-BENCHMARK INTEREST RATE-RAISING

Dow Dives As Fed Hikes Key Rate Three-Quarters Of A Point

Federal Reserve Announces Another Aggressive Interest Rate Hike

The American <a href="http://dailywire.com/topic/economy" target="_blank" rel="noopener">economy</a> is expected to grow at a paltry 0.3% annualized rate in the third quarter of 2022, according to data from the Federal Reserve Bank of Atlanta.
The regional bank’s <a href="https://www.atlantafed.org/cqer/research/gdpnow">GDPNow</a> tracker, which calculates a running estimate of real output growth, correctly predicted that the economy would contract in both the first and second quarters of this year. Indeed, <a href="https://www.bea.gov/data/gdp/gross-domestic-product">data</a> from the Bureau of Economic Analysis later confirmed that the United States met the rule-of-thumb definition of a <a href="http://dailywire.com/topic/recession" target="_blank" rel="noopener">recession</a> — two consecutive quarters of negative growth — as the economy shrank at a 1.6% annualized rate in the first quarter and a 0.6% pace in the second quarter.
While landmark reports regarding employment, inflation, private inventories, manufacturing output, and the housing market have been published over the past two months, analysts in Atlanta have <a href="https://www.atlantafed.org/-/media/documents/cqer/researchcq/gdpnow/RealGDPTrackingSlides.pdf">repeatedly downgraded</a> their growth forecast for the third quarter.
Price levels increased 8.3% between August 2021 and August 2022, according to a <a href="https://www.bls.gov/news.release/cpi.nr0.htm">report</a> from the Bureau of Labor Statistics. The reading marks a decline from the 8.5% year-over-year rate seen in July 2022 and the 9.1% year-over-year rate seen in June 2022 as gasoline prices gradually decrease. However, month-over-month prices for food, shelter, and medical services <a href="https://www.dailywire.com/news/august-inflation-report-shows-several-nasty-surprises-biden-claims-victory-anyway">ticked upward</a>, while core inflation — a metric that excludes food and energy prices, which tend to be more volatile — continued to rise.
Income has nevertheless failed to keep pace with rising costs. Although nominal wages have increased between August 2021 and August 2022, real average hourly earnings — which consider the impact of inflation — decreased 2.8% over the same period, according to another <a href="https://www.bls.gov/news.release/realer.htm">report</a> from the Bureau of Labor Statistics. A decrease in the average workweek by 0.6% implied a 3.4% overall drop in real average weekly earnings.
Meanwhile, Federal Reserve Chair Jerome Powell recently <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">indicated his willingness</a> to “bring some pain” while combating inflation. Interest rate hikes from the central bank dampen prices by increasing the cost of borrowing money for businesses and consumers. “Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” Powell remarked at a speech in Jackson Hole, Wyoming. “Without price stability, the economy does not work for anyone.”
Rising interest rates have led to mortgage rates surpassing 6%, according to <a href="https://fred.stlouisfed.org/series/MORTGAGE30US">data</a> from government-backed mortgage company Freddie Mac, even as residential real estate prices soar. Home prices are <a href="https://www.dailywire.com/news/home-prices-mortgage-rates-expected-to-stay-elevated-through-next-year">expected to increase</a> another 4% in 2023 — a relative slowdown from 17.8% in 2021 and 12.8% in 2022.
“The Federal Reserve’s action to help manage inflation has created significant volatility in mortgage rates and, by extension, the housing market,” Freddie Mac Chief Economist Sam Khater explained in a <a href="https://freddiemac.gcs-web.com/news-releases/news-release-details/freddie-mac-market-slowdown-will-continue-high-rates-and-prices?_ga=2.144200565.1999635517.1658409327-1899122076.1653489074">press release</a> two months ago. “Although house price appreciation will grow at a more moderate rate, home prices remain high relative to homebuyer incomes. Taken together, these factors are exacerbating affordability challenges and causing a slowdown in the housing market.”
A bright spot in an otherwise bleak economic landscape, however, has been the labor market, which is maintaining unemployment rates well below historic norms. Yet <a href="https://www.dailywire.com/news/unemployment-rate-edges-upward-for-the-first-time-in-months-as-more-americans-return-to-work">joblessness rose</a> last month to 3.7% even as more Americans returned to work, according to a <a href="https://www.bls.gov/news.release/empsit.nr0.htm">release</a> from the Bureau of Labor Statistics.

American flag in Midtown Manhattan

American Economy Shrank In The First Two Quarters And Will Likely Stagnate In The Third

Atlanta Federal Reserve Releases Dismal Economic Prediction

Have you ever seen former <a href="https://www.dailywire.com/topic/new-england-patriots" target="_blank" rel="noopener">New England Patriots</a> star Julian Edelman&#8217;s <a href="https://www.youtube.com/watch?v=4SiUNdkIwzQ" target="_blank" rel="noopener">unbelievable catch</a> as part of the team&#8217;s 25-point comeback in Super Bowl 51? It undoubtedly took &#8220;great skill&#8221; and &#8220;good luck&#8221; — thanks, in large part, to his years of practice and determination.
Unfortunately for the United States economy, the Federal Reserve is also going to need the same level of preparation and serendipity to avoid economic ruin, and U.S. Treasury Secretary Janet Yellen is no Julian Edelman.
On Sunday, Yellen <a href="https://www.businessinsider.in/stock-market/news/yellen-says-the-fed-will-need-good-luck-and-great-skill-if-its-going-to-pull-off-a-soft-landing-for-the-us-economy/articleshow/94157337.cms" target="_blank" rel="noopener">told</a> CNN, &#8220;The Fed is going to need great skill and also some good luck to achieve what we sometimes call a soft landing.&#8221;
More precisely, she is referring to an economy where inflation falls below 2% and unemployment remains low. If the American economy does not achieve that &#8220;soft landing,&#8221; it is likely we will be plunged into a recession after a hard landing.
While Yellen might seem confident that America can avoid such economic pain, Fed chairman Jerome Powell appears to disagree. Since the spring, the Fed has attempted to usher America toward economic success by hiking interest rates.
Yet, Powell maintains that not raising the rates would bring about more &#8220;pain.&#8221;
“While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses,” Powell <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain" target="_blank" rel="noopener">said</a> at the annual policy speech at Jackson Hole, Wyoming. &#8220;These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.&#8221;
It is expected that the Fed will announce another round of rate hikes, something tech billionaire Elon Musk warns could cause deflation. Musk holds such dire predictions because he, alongside economist David Branchflower, believes that inflation has peaked.
Branchflower recently <a href="https://www.politico.com/news/magazine/2022/09/08/dangerous-groupthink-at-the-federal-reserve-00055324" target="_blank" rel="noopener">wrote</a> in Politico that &#8220;policymakers are forgetting their history, and now they’re basically winging it&#8221; and risking raising rates when inflation is already cooling.
Other economists, like Goldman Sachs&#8217; Tim Moe, argue that more effort is needed on closing the gap in the labor market.
&#8220;The real sticky bit of inflation is, of course, in the labor market, and that&#8217;s where there&#8217;s some progress that&#8217;s been made. But a lot more that has to be accomplished,&#8221; Moe <a href="https://markets.businessinsider.com/news/stocks/inflation-peak-fed-labor-market-jobs-soft-landing-goldman-sachs-2022-9" target="_blank" rel="noopener">told</a> Business Insider.
&#8220;One of the issues or the indicators that we look at is the gap between job openings and the labor force,&#8221; Moe said. &#8220;That&#8217;s coming down. And that&#8217;s actually the key to a soft landing.&#8221;
Yet, according to the Fed&#8217;s Vice Chair Lael Brainard, the board&#8217;s main concern remains inflation and they feel confident in the labor market.
“Monetary policy will need to be restrictive for some time to provide confidence that inflation is moving down to target,&#8221; she said recently. &#8220;The economic environment is highly uncertain, and the path of policy will be data dependent,&#8221; she <a href="https://www.federalreserve.gov/newsevents/speech/brainard20220907a.htm" target="_blank" rel="noopener">added</a>.
So according to some of the smartest folks in the room — at least according to popular opinion — America’s options are either a hard landing and subsequent recession, deflation, or throwing our hopes on a wing and a prayer. 
At this point in the column, readers might be feeling pretty uneasy about our nation&#8217;s experts&#8217; ability to solve inflation.
When the treasury secretary is incorporating &#8220;good luck&#8221; and &#8220;great skill&#8221; into her economic remedies to avoid a hard landing or deflation, that uneasiness is entirely reasonable.
Just a reminder, here&#8217;s a metaphor for what that looks like:
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">
Still don’t know how Julian Edelman made this catch. An All-Time great catch to help complete the greatest comeback in NFL history&#8230; legendary stuff. <a href="https://t.co/REB1JAQ28k">pic.twitter.com/REB1JAQ28k</a>
&mdash; Pats Buzz (@PatsBuzz) <a href="https://twitter.com/PatsBuzz/status/1294059895919083520?ref_src=twsrc%5Etfw">August 13, 2020</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
The views expressed in this piece are the author’s own and do not necessarily represent those of The Daily Wire.

Janet Yellen

Janet Yellen Says America Needs ‘Great Skill’ And ‘Good Luck’ For A Soft Landing. We Are Screwed.

Janet Yellen Says American Economy Needs 'Good Luck' And 'Great Skill' For A Soft Landing. We Are Screwed.

Total household <a href="http://dailywire.com/topic/economy" target="_blank" rel="noopener">wealth</a> in the United States fell $6.1 trillion dollars in the second quarter of 2022, according to <a href="https://www.federalreserve.gov/releases/z1/dataviz/z1/balance_sheet/chart/#units:usd;series:balance-sheet">data</a> released on Friday by the <a href="http://dailywire.com/topic/federal-reserve" target="_blank" rel="noopener">Federal Reserve</a>.
The central bank’s Financial Accounts of the United States <a href="https://www.federalreserve.gov/releases/z1/20220909/z1.pdf">report</a> showed that wealth held by households and nonprofits dropped from $149.9 trillion at the end of March to $143.8 trillion at the end of June, representing a 4% decline.
Although the value of real estate increased $1.4 trillion, the value of directly and indirectly held corporate equities fell $7.7 trillion. Household debt, meanwhile, increased at an annualized rate of 7.4%. Indeed, the ratio between net worth and disposable income fell from 824% to 778%.
The United States recently met the rule-of-thumb definition of a recession — two consecutive quarters of negative growth — since the economy <a href="https://www.dailywire.com/news/united-states-economy-shrinks-in-the-first-part-of-2022">shrank</a> at a 1.6% annualized rate in the first quarter and <a href="https://www.dailywire.com/news/u-s-in-a-recession-after-second-straight-quarter-of-negative-growth">contracted</a> at a 0.6% pace in the second quarter. Year-over-year inflation reached 8.5% in July 2022, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, with a slight moderation from the 9.1% reading in June 2022 <a href="https://www.dailywire.com/news/white-house-starts-victory-lap-amid-slightly-less-dismal-inflation-reading">driven</a> by lower energy prices — even as costs for food, new vehicles, medical care, and shelter continue to rise.
In reaction to persistent inflationary pressures, the Federal Reserve has adopted a <a href="https://www.dailywire.com/news/federal-reserve-hikes-interest-rates-again-to-combat-bidenflation">hawkish</a> approach to raising interest rates — a policy that tends to restrict economic output as the cost of borrowing money increases. Monetary policymakers’ current target is between 2.25% and 2.5%.
“Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” Federal Reserve Chair Jerome Powell said in a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">speech</a> delivered at the central bank’s annual symposium in Jackson Hole, Wyoming. “Without price stability, the economy does not work for anyone. In particular, without price stability, we will not achieve a sustained period of strong labor market conditions that benefit all. The burdens of high inflation fall heaviest on those who are least able to bear them.”
Officials in the Biden administration, however, have dismissed potential inflationary impacts arising from a series of recent federal stimulus packages. Treasury Secretary Janet Yellen <a href="https://www.dailywire.com/news/janet-yellen-we-have-experienced-one-of-the-quickest-economic-recoveries-in-our-modern-history">praised</a> the business climate under President Joe Biden as “one of the quickest economic recoveries in our modern history.”
“Our plan has worked,” she commented. “The United States experienced the fastest pace of job creation in our history. Household balance sheets are strong. Businesses continue to invest. Our broad and inclusive recovery has outpaced that of many other large economies.”
An <a href="https://www.dailywire.com/news/most-top-biden-officials-have-0-years-of-business-experience">analysis</a> from the Committee to Unleash Prosperity, a conservative think tank, found that the top 68 individuals in the Biden administration have spent an average of 2.4 years in the business world, with only one in eight boasting “extensive business experience.” The median length of business experience for Biden officials is zero years — a significant departure from the median of eight years among top members of the Trump administration.
“Surely we want our political class to have a diversity of backgrounds. We want lawyers, grassroots activists, those with political and policy experience, scientists, health experts, and academics with required specialties,” the report argued. “But we also want people who have experience running large operations with hundreds and thousands of employees and who understand logistics.”

Ariel Skelley / The Image Bank / Getty Images

American Households Lost $6 Trillion In Three Months

American Households Lost $6 Trillion Of Wealth In The Second Quarter Of 2022

Biden Administration

Asset management <a href="https://www.dailywire.com/topic/business">company</a> BlackRock contends that the <a href="http://dailywire.com/topic/federal-reserve">Federal Reserve</a> is not effectively maintaining a balance between reducing <a href="http://dailywire.com/topic/inflation">inflation</a> and avoiding a <a href="http://dailywire.com/topic/recession">downturn</a> amid widespread pressure to control higher prices.
Year-over-year inflation reached 8.5% in July 2022, according to <a href="https://www.bls.gov/news.release/cpi.nr0.htm">data</a> from the Bureau of Labor Statistics, with a slight moderation from the 9.1% reading in June 2022 <a href="https://www.dailywire.com/news/white-house-starts-victory-lap-amid-slightly-less-dismal-inflation-reading">driven</a> by lower energy prices — even as costs for food, new vehicles, medical care, and shelter continue to rise. Federal Reserve Chair Jerome Powell said during a <a href="https://www.dailywire.com/news/jerome-powell-vows-to-restore-price-stability-even-though-federal-reserve-must-first-bring-some-pain">hawkish speech</a> at the central bank’s recent symposium in Jackson Hole, Wyoming, that policymakers are willing to “bring some pain” in their efforts to combat inflation.
BlackRock analysts, therefore, said in a <a href="https://www.blackrock.com/ae/intermediaries/insights/global-weekly-commentary">market commentary</a> that the central bank’s policies have been too aggressive. “We think they’re not prioritizing economic implications over pressure to curb inflation,” they remarked. “It seems they do not intend, for now, to manage the sharp trade-off between inflation and growth. That’s a big deal. We think getting inflation back to central bank targets means crushing demand with a recession. That’s bad news for risk assets in the near term.”
To stimulate the economy after COVID and the lockdown-induced recession, the Federal Reserve <a href="https://www.dailywire.com/news/federal-reserve-releases-plan-to-more-urgently-address-high-inflation">pegged</a> a near-zero target interest rate and began buying $120 billion in assets each month — policies intended to lower the cost of borrowing while increasing the amount of liquidity in the economy. With the <a href="https://www.dailywire.com/news/federal-reserve-hikes-interest-rates-again-to-combat-bidenflation">rollback</a> of loose monetary policy, however, the cost of borrowing increases, introducing constraints upon business activity and consumer spending.
BlackRock CEO Larry Fink noted during an <a href="https://www.foxbusiness.com/markets/blackrock-ceo-larry-fink-discusses-inflation-esg-investing-energy-sector">interview</a> with Fox Business that “very large” fiscal stimulus packages in the United States and Europe render central bankers’ work to manage inflation “much harder.”
&#8220;We have a disconnect between what policy is being proposed and what the responsibilities of these central banks are,&#8221; Fink commented. “We’ve created policies that are very inflationary.”
President Joe Biden <a href="https://www.dailywire.com/news/biden-signs-740-billion-inflation-reduction-act">recently signed</a> the Inflation Reduction Act — a $740 billion package that includes $369 billion in climate spending. Though administration officials have claimed that the bill decreases the federal deficit, Fink said that “whatever deficit reduction” produced by the law has been offset by other policy proposals.
Fink also acknowledged that the United States is “technically” in a recession given “raw” economic statistics, although economists in the White House have <a href="https://www.dailywire.com/news/bidens-economy-identifies-as-growing">rejected</a> such claims. The United States met the rule-of-thumb definition of a recession — two consecutive quarters of negative growth — last month as the economy <a href="https://www.dailywire.com/news/united-states-economy-shrinks-in-the-first-part-of-2022">shrank</a> at a 1.5% annualized rate in the first quarter and <a href="https://www.dailywire.com/news/u-s-in-a-recession-after-second-straight-quarter-of-negative-growth">contracted</a> at a 0.6% pace in the second quarter.
BlackRock has played a <a href="https://www.dailywire.com/news/investment-giant-blackrock-loses-1-7-trillion-in-six-months">pivotal role</a> in encouraging a shift to renewable energy through its embrace of the environmental, social, and governance (<a href="https://www.dailywire.com/topic/esg">ESG</a>) movement. As California faces <a href="https://www.dailywire.com/news/california-democrat-made-fun-of-texas-for-power-issues-now-hes-reminding-his-state-to-brace-for-blackouts">rolling blackouts</a> and the European Union responds to <a href="https://www.dailywire.com/news/germany-reverts-to-burning-coal-will-keep-two-nuclear-plants-open-ahead-of-winter-months">soaring electricity prices</a>, Fink appeared to acknowledge that a “long-term transition” to green power sources is necessary.
&#8220;We do believe investing in infrastructure is going to be a good alternative,&#8221; he commented. &#8220;Investing in water, investing in gas, investing in hydrogen — these are all going to be great long-term investments for retirees.&#8221;

Blackrock Chairman And CEO Larry Fink Visits “The Claman Countdown”

BlackRock Argues Federal Reserve Is Not Maintaining Balance Between Cutting Inflation, Avoiding Downturn

BlackRock Says Federal Reserve Has Been Too Aggressive With Rate Hikes

BlackRock

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