Your 2024 Economic Year in Review
Happy New Year! In this special year-end episode, Chris and Saied dive deep into the wild ride that was 2024, recapping the economy quarter by quarter with their signature mix of insight and banter. From the "pensive" start of the year where the Fed played cat-and-mouse with rate cuts to the real estate market's affordability crisis and the Magnificent Seven’s domination of Wall Street, this episode is packed with more twists and turns than a rollercoaster at an abandoned theme park. Whether it's debating AI's transformative potential, lamenting high mortgage rates, or pointing out the "Jersey Shore" dynamics of the Federal Reserve, Chris and Saied break it all down with wit, wisdom, and the occasional mocktail reference.
➡️ As they toast to a new year (mocktail in hand), the duo doesn't shy away from discussing the highs and lows of 2024, from soaring office vacancies to spiraling service costs. And as tradition dictates, they leave you with a little financial humor to ring in 2025: "Remember, folks, economic resolutions are like gym memberships—great in theory, but it’s the follow-through that counts! Stay sharp, stay savvy, and don’t let inflation shrink your New Year’s champagne budget." Here's to another year of keeping it real, financial nerds. Cheers! 🥂💥 Have you left your "honest ⭐️⭐️⭐️⭐️⭐️" review?
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⚠️ Disclaimer: Please note that the content shared on this show is solely for entertainment purposes and should not be considered legal or investment advice or attributed to any company. The views and opinions expressed are personal and not reflective of any entity. We do not guarantee the accuracy or completeness of the information provided, and listeners are urged to seek professional advice before making any legal or financial decisions. By listening to The Higher Standard podcast you agree to these terms, and the show, its hosts and employees are not liable for any consequences arising from your use of the content.
Transcript
Yeah.
Saeed Omar:Oh, yeah.
Chris Nahibi: Well, it's the end of: Saeed Omar:Oh, buddy.
Chris Nahibi:It's.
Saeed Omar: ,: Saeed Omar: ,: Chris Nahibi:You want to keep saying it wrong?
Saeed Omar: Or if you could recap: Chris Nahibi:How would I describe it?
Chris Nahibi:Wow.
Saeed Omar:How would you describe it?
Chris Nahibi:Pensive.
Saeed Omar:Oh, SAT vocabulary.
Chris Nahibi:Yeah.
Chris Nahibi:Had to come out swinging with the SAT vocabulary.
Chris Nahibi:2024, for me, was a year where we started off the year, and the greater portion of it, we were just in this holding pattern waiting for the Fed to make a move.
Chris Nahibi:I don't think the data ever got to where we felt comfortable enough with the moves, where we felt really strong that the data said, hey, it's time to cut, but we needed to, because there were other economic outliers.
Chris Nahibi:And then at the same time, when they did start cutting rates, the markets were not normally reactive.
Saeed Omar:They didn't really know what to make of it.
Chris Nahibi:Yeah, they.
Chris Nahibi:There was a little bit of euphoria, a little bit of, you know, temporary market high.
Chris Nahibi:And then the treasuries went the other way, and the market didn't really respond the way that I think most people tried traditionally thought it would.
Chris Nahibi:And it just made everybody uncomfortable, nervous, anxious, hence pensive.
Saeed Omar:And we're going to get into all that on today's episode.
Saeed Omar:But first, welcome back to the number one financial literacy podcast in the world.
Saeed Omar:Sitting next to me on my left is my partner in crime, the one and only Chris Nahibi.
Chris Nahibi:Sitting next to me on my right, the one and only Saeed Omar.
Chris Nahibi:My partner in time.
Saeed Omar:Thank you, my man.
Saeed Omar:And sitting behind the ones and twos is a computer and AI Cutter.
Chris Nahibi:AI Cutter.
Saeed Omar:Yeah, the cutter.
Saeed Omar:The AI.
Chris Nahibi:Oh, yeah, you can tell.
Chris Nahibi:I say you'd use that technology a lot, Otter.
Chris Nahibi:Yeah, it's our AI replacement of a rune.
Chris Nahibi:This one doesn't speak, doesn't actually ask us for anything.
Saeed Omar:Breathe into hot mics.
Chris Nahibi:Yeah, he did that.
Chris Nahibi:Dude, just between you and me, just.
Saeed Omar:Yeah, no one's listening.
Saeed Omar:Circle of trust.
Chris Nahibi:There is.
Chris Nahibi:I have a throat clearing issue.
Chris Nahibi:So I'm not.
Chris Nahibi:I'm not the pot calling the kettle big, kettle black.
Chris Nahibi:Okay, okay.
Chris Nahibi:I'm just saying he has some breathing issues, man.
Chris Nahibi:Like, every episode I would listen to, because that's what I do, for those of you who don't know, is I mix and master the audio, and then I go over the video component and I try to layer in the audio as cleanly as possible into the video component.
Saeed Omar:I know it can be confusing, and when you look at us.
Saeed Omar:You think our voices are naturally this sexy.
Saeed Omar:But there is a little bit of mixing and mastering.
Chris Nahibi:Yeah, I mean, I don't normally sound like a Spanish broadcast announcer.
Chris Nahibi:Hola, gracias.
Chris Nahibi:Yeah, it's but that being said, he, I, I, I've spent probably on average each episode 30 to 40 minutes just clearing out his coughing and throat clearing.
Saeed Omar:Wow.
Chris Nahibi:I mean it is, it is, it is bad.
Chris Nahibi:Then you throw in some of the episodes where he eats and I'm just like this guy, bro.
Chris Nahibi:I just can't, I can' I can't do it.
Chris Nahibi:Like all that background noise is there.
Saeed Omar:I mean, that's how much love we have for him.
Saeed Omar:That even with all that.
Chris Nahibi:Yeah, part of me, it would have been easier if I just used like the, the mix.
Chris Nahibi:So for, again, those of you don't listen to the show, all the stuff that you hear now is generally recorded in a single track without all that background noise.
Chris Nahibi:But I go in and I mix and master Run's audio and I mix and master Saeed's audio.
Chris Nahibi:Mix and master my audio separately.
Chris Nahibi:So when we smush them all together.
Saeed Omar:Smush?
Chris Nahibi:Yeah.
Chris Nahibi:You get.
Saeed Omar:Yeah, like the smush room.
Chris Nahibi:Sexy.
Saeed Omar:Yeah.
Saeed Omar:Do you do it in the smush room?
Chris Nahibi:Yeah.
Chris Nahibi:I mean, do you, do you don't.
Saeed Omar:You don't, you don't, you don't strike me as a Jersey Shore kind of guy.
Chris Nahibi:Oh, I did watch the very first season of Jersey Shore.
Saeed Omar:So you want you committed to the whole season.
Saeed Omar:That's impressive.
Chris Nahibi:Very first.
Saeed Omar:I thought you would watch the first episode like, oh, this trash tv.
Chris Nahibi:No, no, I never watched it like linear.
Chris Nahibi:Like I watched like an episode because like, you know, those were so stigmatized with overdramatic.
Chris Nahibi:They just sucked you in from the, from the very beginning.
Saeed Omar:Oh, yeah, well, I've seen, I've heard executive producers talk about that show and like they would intentionally do stuff that they knew would irritate, you know, the people in the house to, to cause more drama, to cause more friction, like make them sleep in the same room as somebody else on a twin size bed.
Saeed Omar:Right.
Saeed Omar:Like, no one's comfortable on the twin size bed like that.
Chris Nahibi:I mean, look, the same strategy is being deployed by the FOMC and Jerome Powell right now.
Chris Nahibi:Right?
Saeed Omar:Oh, I like the correlation.
Chris Nahibi:Yeah.
Chris Nahibi:I mean, it's basically Jersey Shore out there.
Saeed Omar:Who's Pauly D?
Saeed Omar:Come on now.
Chris Nahibi:Come on.
Saeed Omar:You know DJ Pauly D, the one that speaks for the group?
Chris Nahibi:He does speak for the group, which is interesting.
Saeed Omar:Like when he speaks, it's like all Right.
Saeed Omar:Everybody listen.
Chris Nahibi:Yeah, yeah, I know all their names anymore.
Saeed Omar:Oh, I got.
Saeed Omar:I got them.
Chris Nahibi:Is he really?
Saeed Omar:It was so polarizing.
Saeed Omar:Oh, j.
Saeed Omar:Wow.
Saeed Omar:Oh, yeah, I remember her, Snooki.
Chris Nahibi:They all look like the same now.
Saeed Omar:They all have the same show still going on.
Chris Nahibi:What?
Saeed Omar:Oh, yeah.
Saeed Omar:Re upped.
Chris Nahibi:Stop that.
Saeed Omar:Swear to God.
Chris Nahibi:Really?
Chris Nahibi:Oh, yeah.
Saeed Omar:I don't watch it, but yeah, allegedly.
Saeed Omar:Allegedly.
Saeed Omar:Allegedly.
Saeed Omar:Never went to Diddy's house either.
Chris Nahibi:Well, I know you didn't get invited to that because there's only one way you'd wind up.
Saeed Omar:Yeah, exactly.
Saeed Omar:So.
Saeed Omar:But if you're listening to this episode on Apple or Spotify, Nice little segue game.
Saeed Omar:Please leave us.
Saeed Omar:An honest five star review does allow for the show.
Saeed Omar:We'll read it right here on this episode.
Saeed Omar:Or if you're watching us over on YouTube, please make sure you hit that, like button.
Saeed Omar:Subscribe.
Saeed Omar:Ring that notification bell.
Saeed Omar:Do all the moist goody good stuff.
Saeed Omar:We've been getting a lot of good comments and a lot of good reviews.
Saeed Omar:I got one the other day that I literally shared with my wife.
Saeed Omar:Right away, I was like, this has been one of my favorite ones.
Chris Nahibi:Really?
Saeed Omar:Yeah.
Saeed Omar:I literally sat there for a couple of minutes after.
Saeed Omar:After I read it, and I was like, I appreciated this person taking the time to send this message and I wanted to read it on the show.
Chris Nahibi:You've been doing a lot of coughing lately.
Chris Nahibi:Okay.
Saeed Omar:I think it's something.
Saeed Omar:There's like, we gotta.
Chris Nahibi:Why do you always play in the studio?
Saeed Omar:We gotta get the air filtration system in here.
Saeed Omar:I don't cough like this all day.
Saeed Omar:I don't have that issue.
Saeed Omar:So this from our guy, Ross Smith.
Chris Nahibi:Oh, I like Ross.
Saeed Omar:Long time listener of the show.
Saeed Omar:Plus one for the name.
Saeed Omar:I like the name Ross.
Saeed Omar:Great name.
Chris Nahibi:Because it harkens back to friends.
Chris Nahibi:Or because you also have three first names.
Saeed Omar:Both.
Saeed Omar:Good job.
Saeed Omar:Yeah.
Saeed Omar:I have already maxed out ratings and reviews for y'all under the various platforms.
Saeed Omar:This is why he's one of my favorites.
Saeed Omar:He's maximum on all the black.
Chris Nahibi:He really has.
Chris Nahibi:Yeah, yeah, he has.
Saeed Omar:And feel free to share this on the podcast if you want.
Saeed Omar:Thank you, Ross.
Chris Nahibi:Yeah, done.
Saeed Omar:But the value of the information you share cannot be measured.
Saeed Omar:Knowledge needs to be teachable.
Saeed Omar:And this is where you and Chris shine and others fall short.
Saeed Omar:You help people to understand, not just steamroll with them with the data and concepts.
Saeed Omar:Something you said in this episode really resonated with me about financial habits forming by the age of seven.
Saeed Omar:That was that study out of Purdue.
Saeed Omar:You all inspired Me to write My Little Nieces and Nephews, a series of children's books centered on financial literacy, hoping to help them get a head start.
Saeed Omar:I just wanted to say thanks again for.
Saeed Omar:For all the edutainment you both provide.
Saeed Omar:Keep it up and I'll keep listening regardless of the algorithm trying to hide you.
Chris Nahibi:And, Ross, if you're selling those books or you have them on Amazon, send us a link.
Chris Nahibi:We'll.
Chris Nahibi:We'll definitely pick a couple of.
Chris Nahibi:Up for our kids, too.
Saeed Omar:110%.
Saeed Omar:Yeah, I'll put it right here on the shelf, bro.
Saeed Omar:On my side.
Chris Nahibi:On your side of the shelf.
Saeed Omar:Yeah.
Saeed Omar:He can.
Saeed Omar:He said that to me.
Chris Nahibi:He did send it to you, and he did follow me before you.
Saeed Omar:I feel like he chose the side.
Chris Nahibi:Well, it's extra special because Top of the show say he doesn't normally go into reviews, so it means that he was thinking about you in a very intimate and sexual way or he liked the review.
Saeed Omar:If I had a plus one to a certain white party, you'd be invited.
Chris Nahibi:Yeah, well, there goes.
Chris Nahibi:There goes advertising for that show.
Chris Nahibi:I don't think you can say white party anymore on the Google's algorithm anymore.
Saeed Omar:You can't say that.
Saeed Omar:No, no, it wasn't even.
Saeed Omar:They didn't call it.
Saeed Omar:They called the All White party.
Chris Nahibi:Are you dying?
Saeed Omar:I think so.
Saeed Omar:I think this is it for me, bro.
Saeed Omar:This is.
Saeed Omar: I've reached my peak, and now: Chris Nahibi:All right, so when the show comes out, if Saeed is still alive, it is New Year's Eve.
Saeed Omar:Please drink responsibly.
Chris Nahibi:And if you are listening to the show, you are a nerd.
Saeed Omar:I love you for.
Chris Nahibi:This is not what you should be doing on.
Saeed Omar:Oh, we had that other listener too, that reached out to us and said that I elected to listen to your guys episode before my final as a way to relax.
Chris Nahibi:Oh, yeah, that was a good one.
Saeed Omar:That was a good one.
Saeed Omar:I was like, damn, plus one for you.
Chris Nahibi:Way to relax.
Saeed Omar:Yeah.
Chris Nahibi:He's talking about my voice, not yours.
Saeed Omar:Clearly.
Chris Nahibi:You cause a lot of anxiety.
Saeed Omar:I do?
Chris Nahibi:Yeah.
Saeed Omar:Dude, I'm the Vix.
Chris Nahibi:Every time I talk to you, there's always a reference to your hands in a length, in a way that's really strange.
Chris Nahibi:Yeah.
Chris Nahibi:Yeah.
Chris Nahibi:I mean, ever since the whole hand gestures in the last show.
Saeed Omar:Yeah.
Chris Nahibi:I can't look at your fingers the same.
Chris Nahibi:They're fuzzy.
Chris Nahibi:They're referencing things.
Chris Nahibi:Yeah, like the fuzzy three pointer fuzzy time.
Saeed Omar:It's just.
Saeed Omar:It's.
Saeed Omar:It's fuzzy.
Saeed Omar:Time, baby.
Chris Nahibi:Is that how you and your wife have like a secret signal?
Chris Nahibi:Hey, baby, baby, look at my knuckles.
Chris Nahibi:Look what I'm pointing at.
Saeed Omar:Let's go, baby.
Saeed Omar:You know what time it is?
Chris Nahibi:The good news is if you ever got lost somewhere, if you did, like, what did I show?
Chris Nahibi:Lost and afraid or naked and afraid or something?
Saeed Omar:Naked and afraid, bro.
Chris Nahibi:So you go out, you'd be able to survive by creating fires with static electricity from knuckles.
Chris Nahibi:Can we have a rub your knuckles again?
Saeed Omar:Hold on, hold on.
Saeed Omar:It's end of the year.
Saeed Omar:We can have a little bit of fun.
Saeed Omar:Let's have.
Saeed Omar:Let's just be honest with each other.
Saeed Omar:If.
Saeed Omar:If you and I ended up on that show naked and afraid, I'd be.
Chris Nahibi:Looking at you, Johnson, the entire time.
Saeed Omar:Obviously, I'd be staring at it.
Chris Nahibi:Made you awkward.
Chris Nahibi:Every time you talk to me, I wouldn't look at you in the eyes.
Saeed Omar:I'd be like, just looking at Johnson.
Chris Nahibi:Yeah.
Saeed Omar:All right.
Saeed Omar:So listen.
Chris Nahibi:I just stare at it.
Saeed Omar:So I'm just staring.
Saeed Omar:So that's it.
Chris Nahibi:Hold on.
Chris Nahibi:I'm gonna burn it in the back of my mind.
Saeed Omar:Hold on.
Chris Nahibi:I know.
Saeed Omar:So you can describe it so I.
Chris Nahibi:Can tell everybody how many times I saw it.
Chris Nahibi:It's got a dimple right there.
Saeed Omar:Dimple?
Saeed Omar:Yeah.
Saeed Omar:Hell yeah.
Saeed Omar:I got dimples, bro.
Chris Nahibi:All that surrounding fat.
Saeed Omar:So listen.
Saeed Omar:So listen, I'm definitely lasting longer than you on Naked and Afraid, right?
Chris Nahibi:Yes.
Saeed Omar:Obviously you have no survival skill.
Saeed Omar:Like, I got all.
Saeed Omar:I got all that, bro.
Saeed Omar:You got.
Saeed Omar:Hold on.
Saeed Omar:You know what, bro?
Chris Nahibi:I will admit that I would fall apart, but not for that reason.
Saeed Omar:Come on.
Saeed Omar:The problem is Boy Scouts, bro.
Chris Nahibi:You were the boy Scouts.
Saeed Omar:No, but I know that makes a.
Chris Nahibi:Lot of sense now.
Chris Nahibi:I get it.
Chris Nahibi:So, yeah, I.
Chris Nahibi:I've always wanted wilderness skills and I consider myself to be a mildly intelligent person.
Saeed Omar:Yeah.
Chris Nahibi:But I would die in a matter of 24 hours.
Chris Nahibi:I would die.
Chris Nahibi:Let me tell you.
Chris Nahibi:Let me tell you how this goes.
Chris Nahibi:It goes for me, okay?
Chris Nahibi:I'm on trt.
Chris Nahibi:That testosterone I'm.
Chris Nahibi:I'm regressing back into.
Chris Nahibi:Into my non masculine habits.
Saeed Omar:I would.
Saeed Omar:I would be so lost.
Saeed Omar:I wouldn't.
Saeed Omar:I'd be like, what's the first thing you do?
Saeed Omar:Do I.
Saeed Omar:I still have sunlight.
Saeed Omar:Do I go look for my food for later tonight or do I go build my tent where I'm going to sleep tonight?
Chris Nahibi:You're already getting that deep into it?
Chris Nahibi:Yeah, I'm thinking about how to get my peptides in my cold plunge.
Saeed Omar:It's out the window, bro.
Chris Nahibi:And the sad part is, if you want to go to my.
Chris Nahibi:I don't go on Tik Tok anymore, and I probably won't be around for much longer anyway.
Saeed Omar:Yeah.
Chris Nahibi:But if you were to go to it, it's all these, like, wilderness survival shows.
Chris Nahibi:This one guy, he looks like a total nerd.
Chris Nahibi:That, that his.
Chris Nahibi:He has, like, all these wonderful survival things.
Chris Nahibi:He goes up to Alaska, and it's crazy stuff.
Chris Nahibi:It's.
Chris Nahibi:It's.
Chris Nahibi:It's mentally intriguing to me.
Chris Nahibi:Like, I dig it.
Saeed Omar:Yeah, it's really cool.
Chris Nahibi:I don't think I would ever want to do it, though.
Saeed Omar:The dude Perfect guys, they.
Saeed Omar:They made a video.
Saeed Omar:And my, My kids are, by the way, are obsessed with, with this.
Saeed Omar:With these guys.
Saeed Omar:They're.
Saeed Omar:They're pretty amazing.
Chris Nahibi:Are they?
Saeed Omar:Yeah, they're cool.
Chris Nahibi:Why are they so amazing?
Saeed Omar:They, They've grown to such a point where they've now reached a new level to where they can do all these.
Chris Nahibi:They.
Saeed Omar:They created.
Saeed Omar:They did this episode where they basically played Clue.
Chris Nahibi:Oh, yeah, yeah.
Saeed Omar:Themselves in a house.
Saeed Omar:You saw that one?
Saeed Omar:I thought it was really, really interesting.
Chris Nahibi:I was like, damn, it's fun stuff.
Chris Nahibi:I will give them that.
Chris Nahibi:It's pretty cool.
Saeed Omar:And it's clean.
Saeed Omar:You know, you could trust your kid watching it and not have to worry.
Chris Nahibi:About anything that's like this podcast.
Chris Nahibi:Yikes.
Chris Nahibi:Yeah.
Saeed Omar:Yeah, seriously.
Saeed Omar:But, like, if you, if you listen to this episode with your kid, I, I respect you that much more.
Chris Nahibi:There are some people who do.
Saeed Omar:I know.
Chris Nahibi:And I always feel bad whenever I make references to your genitalia afterward.
Chris Nahibi:Just saying, like, you know, it's probably not appropriate for the kids.
Saeed Omar:Yeah.
Saeed Omar:But they gotta understand that it could, it could be done in a very tasteful way.
Chris Nahibi:That's inappropriate.
Chris Nahibi:That's not, that's not.
Chris Nahibi:Nope.
Saeed Omar:Come on.
Chris Nahibi:Hey, guys.
Saeed Omar:Last show.
Saeed Omar:This is the last show, baby.
Saeed Omar:We're going out with a bang.
Saeed Omar:2024, son.
Chris Nahibi:Oh, God.
Chris Nahibi:This is.
Saeed Omar:I said my veins.
Chris Nahibi:This is gonna get played.
Chris Nahibi:This is gonna get played in court.
Saeed Omar:I don't miss.
Saeed Omar:I don't miss with the opportunity's there.
Saeed Omar:I dunk that.
Saeed Omar:Come on.
Saeed Omar:I swear to God.
Saeed Omar:We got a show for everybody.
Saeed Omar:We, we have, we have.
Saeed Omar:Hold on.
Saeed Omar:We have.
Chris Nahibi:We got to start over, dude.
Chris Nahibi:It's too bad.
Saeed Omar:No, no, we can't, we can't.
Saeed Omar:I'm crying.
Saeed Omar:All right.
Chris Nahibi:I, I, I don't know how to pivot from that.
Chris Nahibi:You're a terrible human being.
Saeed Omar:We have a structure.
Saeed Omar:Straight to hell.
Chris Nahibi:All right, so it's the end of the year.
Chris Nahibi:And despite the fact that we don't haven't talked about a single thing financially so far on the show, we are going to talk about the year in review.
Chris Nahibi:And I swear to God it's gonna be serious at this point.
Chris Nahibi:It's been a long week.
Chris Nahibi:So we decided to divide.
Chris Nahibi:Divide up the year in review into quarters because as you know from the show, most financial information is parsed out to you in quarterly doses.
Chris Nahibi:You get some stuff in between, obviously, weekly reports on businesses and companies and some data points.
Chris Nahibi:What?
Chris Nahibi:Why are you laughing still?
Chris Nahibi:We're gonna give, say, five minutes on his own.
Chris Nahibi:You're in time out.
Chris Nahibi:Yeah.
Chris Nahibi:Take a break.
Chris Nahibi: ecifically in each quarter of: Chris Nahibi:So let's go quarter by quarter into those four headline topics and talk about the changes that we've seen.
Chris Nahibi:Say, you breathing okay over there?
Chris Nahibi:Yeah.
Saeed Omar:We're back, baby.
Saeed Omar:We're back.
Chris Nahibi: of: Chris Nahibi: d the year the previous year,: Chris Nahibi:The year started with the market uncertainty as investors debated the Fed's next moves.
Chris Nahibi:Are they going to cut rates?
Chris Nahibi:Were they?
Chris Nahibi:We didn't know.
Chris Nahibi:Wound up being quite a bit of time before they did.
Chris Nahibi:The S P 500 of the Nasdaq showed moderate gains as AI and tech stocks continued to shine.
Chris Nahibi: of: Chris Nahibi:And I gotta be honest, it's been beneficial.
Chris Nahibi:I've been able to use it and improve my workload a little bit.
Chris Nahibi:But has it revolutionized anything like tangibly yet?
Chris Nahibi:I don't think so.
Saeed Omar:Okay.
Chris Nahibi:We've obviously seen some mass improvements this year in AI from ChatGPT being very, very much in the headlines to the current version of 4.0, as well as their now video generating model, which I've played with.
Chris Nahibi:So we've seen some pretty palpable growth in the AI space and some of the things that we know from a capability standpoint that it can do, but has it been earth shattering to the markets.
Chris Nahibi:Has it justified all the stock price rises?
Chris Nahibi:That remains to be seen.
Chris Nahibi: of: Chris Nahibi:There was an early optimism that led to a January effect rally, if you will.
Chris Nahibi:But fears of inflation persisting for longer, the higher for longer rhetoric kept markets in check.
Chris Nahibi:So we were so hyper concerned that the Fed would not be able to cut rates because inflation had not responded anywhere near down to the 2% target, that everybody was going, oh my God, we don't know what's going to happen next.
Chris Nahibi:When, when, when are they going to cut rates?
Saeed Omar:Yeah, and the Fed was really trying to control the narrative, right.
Saeed Omar:They were trying to minimize the amount of optimism that was still around in the market.
Saeed Omar:So they were really coming out the gate swinging like we're going to hold rates higher for longer.
Saeed Omar:Remember that was the phrase that they were utilizing for a long time just to, you know, steer people in the right direction, that you need to stop being so optimistic.
Chris Nahibi:And that there we saw behavioral economics really start to play a role here where people were, were choosing how they were going to impact the market instead of the market impacting them.
Saeed Omar:Okay.
Chris Nahibi:There was a different perception, and I think if you look at Robert Schiller's emotional kind of band of where people's emotions naturally fall into.
Chris Nahibi:There was a longer pattern of denial I think in the markets of what this all really meant to most consumers.
Chris Nahibi:But it wasn't just the stock market, it was also the real estate market.
Chris Nahibi:High mortgage rates were a big problem to start off the year.
Chris Nahibi: of: Chris Nahibi:That's where we started the year, above 6.5%, stalling home sales and prices out for first time buyers.
Chris Nahibi:And that largely did not improve throughout the entire year.
Chris Nahibi:We started off with first time homebuyers having a problem.
Chris Nahibi:We ended off with first time homebuyers having a bigger problem because home prices did not go down on average across the country this year.
Chris Nahibi:They went up.
Chris Nahibi:So now home price unaffordability, end of the year, even worse than when we started it.
Chris Nahibi:Low inventory was the talk of the town.
Chris Nahibi:Excuse me, everybody in the real estate market, realtors, everybody, from an economist standpoint, they were really siding.
Chris Nahibi:Housing supply was tight, keeping the prices elevated despite lower transactional volume.
Chris Nahibi:So we saw transactional volumes creeping up, creeping down, but home prices creeping up.
Chris Nahibi:And everybody was like, okay, well there's just not enough supply to meet the demand.
Chris Nahibi:I Don't know about you, but certainly towards the end of the year, that rhetoric tapered off a great deal.
Chris Nahibi:And then really, the supply side argument is almost like a background kind of noise, a little thing off the distance.
Saeed Omar:Yeah.
Chris Nahibi:But it's not anywhere near as front and center of the argument for housing as when we started the year.
Saeed Omar:Absolutely.
Chris Nahibi:You okay over there?
Saeed Omar:Yeah, I'm great.
Saeed Omar:We're back, baby.
Chris Nahibi:You're back.
Chris Nahibi:Yeah, in line.
Chris Nahibi:That's pretty funny.
Saeed Omar:Yeah.
Chris Nahibi:All right.
Chris Nahibi:Federal reserve.
Chris Nahibi:Well, in Q1, the Federal Reserve was all about two things.
Chris Nahibi:A rate pause and inflation data.
Chris Nahibi: eld rates steady after ending: Chris Nahibi:Inflation data, of course, was mixed.
Chris Nahibi:There was mixed signals on inflation.
Chris Nahibi:Core CPI remained steadily sticky and services inflation stayed high.
Chris Nahibi:So there wasn't dramatic improvements in what the Fed was targeting to change.
Chris Nahibi:Certainly we'd come down from 9.1% peak, but you had this really, really sticky CPI inflation print, and you had services inflation exceedingly above where it should have been otherwise.
Chris Nahibi:And the flood was the flood.
Chris Nahibi:The Fed was just perplexed at why this was happening.
Chris Nahibi:So they stuck to the higher for longer narrative.
Saeed Omar:Higher.
Saeed Omar:Exactly.
Saeed Omar:And they had not.
Saeed Omar:At that point in time.
Saeed Omar:We had.
Saeed Omar:We were not sure whether they were done cutting rates or not.
Saeed Omar:Right.
Saeed Omar:So that was the.
Saeed Omar:The.
Chris Nahibi:Done raising rates.
Saeed Omar:Yeah, done raising rates.
Saeed Omar:I'm sorry, done raising rates.
Saeed Omar:And that was, that was the talk that everyone, the thing that everyone kept talking about.
Saeed Omar:And there was real concern with, you know, how, how is this going to turn out?
Saeed Omar:Because there was a multiple phase approach to this.
Saeed Omar:Right.
Saeed Omar:The first phase to this was the raising of the rates to try to tame inflation.
Saeed Omar:The second phase of it was going to be, when is the Fed going to begin to admit that we're done raising and we're just going to pause and we're just going to hold here for a while.
Saeed Omar:And we were all waiting because we knew that that third phase of actually cutting rates, which we'll get into later in the show, which we've recently started experimenting or experiencing in September, that you fumble the bag.
Saeed Omar:Hold on, let me get it back, let me get it back.
Saeed Omar:And so we were still wondering, how much longer are we going to be in phase one or phase two?
Saeed Omar:Are we in phase two or are we in phase one?
Chris Nahibi:And of course, in the political side of things, there was the old early warning signs of potential debt ceiling.
Chris Nahibi:Oh, my God, the debt ceiling.
Chris Nahibi:The standoff set the stage for political wrangling later in the year.
Chris Nahibi:But it was all throughout the first quarter.
Chris Nahibi:What are we going to do?
Chris Nahibi:We hit the debt ceiling.
Chris Nahibi:We're going to raise it.
Chris Nahibi:That's what we're going to do.
Chris Nahibi:And that's, in fact, what they did.
Chris Nahibi:Yep.
Chris Nahibi:The government raised the debt ceiling.
Chris Nahibi:And that's where you started the beginning of the election noise.
Chris Nahibi:Everybody started turning their perspective politically towards the November 5 election.
Chris Nahibi:So what happened?
Chris Nahibi:Presidential primaries began to heat up, adding to the market uncertainty.
Chris Nahibi:And you also had Biden and his administration essentially foregoing a lot of the primary stuff and trying to push Kamala Harris in ultimately towards the end of the year.
Chris Nahibi:But at that point in time, we didn't know that.
Chris Nahibi:And Biden was insistent that he was gonna run.
Chris Nahibi:And you weren't even so sure about Trump's position, given his own legal issues and history there at that point in time.
Saeed Omar:That's true.
Chris Nahibi:It was still a very unclear beginning to the year, and nobody really knew who was going to be in power and who the leading candidates would even be at that point in time.
Chris Nahibi:So there was a lot of speculation.
Chris Nahibi:And then Q2 hit and things started to change.
Chris Nahibi:But stay the same.
Chris Nahibi:You ready for Q2?
Saeed Omar:Yeah, let's.
Saeed Omar:Hit me with it.
Saeed Omar:Hit me with your best shot.
Saeed Omar:Don't do this.
Chris Nahibi:You can't keep throwing this out there.
Chris Nahibi:You're making this.
Chris Nahibi:You're making this too easy.
Chris Nahibi:That I feel compelled at the end of the year.
Saeed Omar:We gotta have a little bit of fun, man.
Chris Nahibi:We should be drinking.
Saeed Omar:Yeah, we should be.
Chris Nahibi:I had a mocktail the other night.
Chris Nahibi:I felt really strange ordering it.
Saeed Omar:You know why you felt strange?
Saeed Omar:Yeah, I can't even say it on the show.
Chris Nahibi:I felt strange.
Chris Nahibi:It was a.
Saeed Omar:It was strange is a very interesting way of putting it.
Chris Nahibi:It's very zesty.
Saeed Omar:Yes, it was.
Chris Nahibi:Yeah, it was very zesty.
Chris Nahibi:But, you know, it was a good drink.
Chris Nahibi:It was a Negroni.
Saeed Omar:I don't know what that is.
Chris Nahibi:Negroni, Italian cocktail.
Chris Nahibi:Very good.
Saeed Omar:Oh, what.
Saeed Omar:What is it?
Chris Nahibi:No alcohol on it, though.
Saeed Omar:No, I get.
Saeed Omar:But okay.
Saeed Omar:What is the Italian cocktail?
Saeed Omar:Was it have vodka?
Saeed Omar:What is it supposed to have?
Chris Nahibi:Oh, you know, I don't know.
Chris Nahibi:I want to say it has.
Saeed Omar:Have you ordered one as a cocktail before?
Chris Nahibi:Yeah.
Chris Nahibi:I can't remember what the main alcohol is in it.
Chris Nahibi:You know, I've gotten so distant from drinking alcohol, I've forgotten a lot of the stuff.
Saeed Omar:So my.
Saeed Omar:My go to cocktail of choice lately is Mexican Mule.
Chris Nahibi:How long have you been having.
Chris Nahibi:When do you have cocktails all the time.
Chris Nahibi:You really?
Saeed Omar:Oh, yeah.
Chris Nahibi:How often is all the time?
Saeed Omar:Once a month.
Chris Nahibi:Negroni is a cocktail that is made with equal parts gin, Campari and sweet vermouth.
Chris Nahibi:So this one just had no alcohol in it, but yeah, it was great music.
Chris Nahibi:Pretty good.
Chris Nahibi:Yeah.
Saeed Omar:All right.
Saeed Omar:Good.
Chris Nahibi:Wasn't bad.
Chris Nahibi:I actually ordered it because I thought it was a beer, a non alcoholic beer.
Chris Nahibi:And then it wasn't.
Saeed Omar:Okay.
Chris Nahibi:And then I was like, well, this kind of feels normal.
Saeed Omar:Good for you.
Chris Nahibi:Yeah.
Chris Nahibi:When was the last time you had this mule?
Saeed Omar:When was the last time I had this meal?
Saeed Omar:Oh, when Odun had that engagement party for his cousin at his house.
Chris Nahibi:How many did you have?
Chris Nahibi:Two.
Chris Nahibi:How'd you feel?
Chris Nahibi:Great.
Saeed Omar:Rockstar.
Chris Nahibi:Next day, normal.
Saeed Omar:He only had two.
Saeed Omar:What do you mean?
Chris Nahibi:I don't.
Chris Nahibi:Dude, I have one on, like the next day, I'm like, hey, no.
Saeed Omar:Really?
Chris Nahibi:Oh, yeah.
Saeed Omar:Wow.
Saeed Omar:Good.
Saeed Omar:Tolerance levels down.
Chris Nahibi:When you get over 40.
Saeed Omar:It hits you.
Chris Nahibi:Yeah, it hits a little different.
Saeed Omar:Yeah, yeah.
Saeed Omar:No, no, I.
Saeed Omar:I mean, I barely even felt it.
Chris Nahibi:Yeah.
Chris Nahibi:It's too easy.
Saeed Omar:Yeah.
Chris Nahibi:Not taking that.
Chris Nahibi:So to start off, Q2, 20, 24, well, markets in real estate begin to shift a little bit.
Chris Nahibi:Not a lot.
Saeed Omar:Okay, a little bit.
Saeed Omar:In which way?
Chris Nahibi:Well, in the stock market in particular, tech and AI dominate again.
Chris Nahibi:Tech stocks, driven by AI innovation, once again lifted the nasdaq while the broader markets faced headwinds.
Chris Nahibi:You started to see a real disparity between the Magnificent Seven and the rest of the market.
Chris Nahibi:And you started to see the real implications of AI, and people started to go, oh, my God, is this a tech bubble?
Chris Nahibi: Are we in another: Chris Nahibi:And I would say that largely it did not throughout the year.
Chris Nahibi:But we didn't know at the time if that was the case because there has been a lot of earnings calls and a lot of people talking about AI and the implications of its institution improving efficiency and doing all these things that we have not still yet seen.
Chris Nahibi:And it wound up being just like any other new industry.
Chris Nahibi:Is that industry overvalued or is it undervalued, or is it valued correctly?
Chris Nahibi:And unfortunately, the way you value this particular industry isn't through like a speculative new business type, like Uber when it launched, or Airbnb when it launched.
Chris Nahibi:You value it by the implications to several of these companies that are making the underlying technology for it, like Nvidia.
Saeed Omar:Okay.
Chris Nahibi:Or that are going to get a huge boost from the usage.
Chris Nahibi:So, you know, like Google.
Chris Nahibi:So those companies who were going to deploy it at a faster case than anybody else and working on their own technologies, they blew up.
Chris Nahibi:And the Mag 7 really lifted the market up entirely.
Chris Nahibi:Cutting out the Mag 7.
Chris Nahibi:Even at this time, you could see that the rest of the market was not performing anywhere near as well as they should.
Chris Nahibi:And otherwise healthy market would suggest that this was a market that was only benefiting one very narrowly tailored sector.
Saeed Omar:Yeah, exactly.
Saeed Omar:Those.
Saeed Omar:Those seven companies were really propping up the entire market.
Saeed Omar:I believe we actually ran some statistics back then where when we.
Saeed Omar:You actually removed those seven tech giants that they were barely seeing any gains.
Saeed Omar:The remainder, 493 companies.
Chris Nahibi:Yeah.
Chris Nahibi:And you know, earnings season wasn't terrible.
Chris Nahibi:During Q2, you started to see corporate earnings showing resilience.
Chris Nahibi:They were still, you know, making money, but there was definitely, definitely some margin compression as the higher input costs, the cost for these companies to manufacture their products, provide their services, started to increase.
Chris Nahibi:Inflation started to have lagging impacts to how much it was costing businesses.
Chris Nahibi:So what did business do?
Chris Nahibi:They started to raise prices to offset during Q2, which then kind of in turn feeds back into inflation.
Chris Nahibi:And part of the reason you had service costs that were so high in the previous quarter, people were trying to offset their cost of producing whatever it is they produced.
Chris Nahibi:Meanwhile, in the real estate market, slight rate relief came.
Chris Nahibi:Mortgage rates dipped briefly below 6.5%.
Chris Nahibi:And every single real estate agent on the interwebs was like, hallelujah, Subway.
Saeed Omar:We're going, we're heading the right direction.
Chris Nahibi:It's going back down.
Chris Nahibi:It's going to be a refi boom.
Saeed Omar:Yeah.
Chris Nahibi:And then it wasn't.
Saeed Omar:And then it wasn't.
Chris Nahibi:And then it wasn't.
Chris Nahibi:It was kind of anticlimactic.
Chris Nahibi:There was a temporary uptick though, in refinancing and home purchases, which was great.
Chris Nahibi:But it wasn't this tidal wave of activity that everybody thought was going to happen because there was a lock in effect.
Chris Nahibi:So many mortgages were below 4%, below even 3% in some cases that it doesn't make economic sense for a lot of people to refinance even when rates dip below 6.5.
Saeed Omar:I think, I think the stat was 85% of homeowners that had a mortgage had a rate below 6%.
Chris Nahibi:Yeah.
Chris Nahibi:And then I heard recently a stat that was interesting.
Chris Nahibi:I was talking to somebody from a very affluent neighborhood in Detroit and they were telling me that people who had mortgages, because it was an older community were very rare in the community.
Chris Nahibi:Most people do not have mortgages, which is the first time I realized that statistic that we heard mid year, about 40% of people across the country having no mortgage in their property.
Saeed Omar:Right.
Chris Nahibi:Was a real factor.
Chris Nahibi:We live in Southern California, and in typically places with high land values, you're going to have less people who own their property in total in cash, versus, like, the Midwest or some other, you know, kind of more Midwestern region.
Chris Nahibi:Focus.
Chris Nahibi:You're going to see a lot more home zone.
Saeed Omar:Detroit is such an interesting city.
Chris Nahibi:Yeah, great city.
Saeed Omar:When's the last time you've been out there?
Chris Nahibi:It's been a long time.
Saeed Omar:It's been a long time.
Saeed Omar:Yeah.
Saeed Omar:I was out there, I'd say maybe like six years ago.
Saeed Omar:So, you know, quite some time ago, we were visiting a friend, and he was kind of giving.
Saeed Omar:Giving us the rundown of how the city operated and worked.
Saeed Omar:Right.
Saeed Omar:And he lived on a street where all the homes were occupied, and they were very well taken care of.
Chris Nahibi:One street over, though, it changes.
Saeed Omar:Literally one street over, you have, you know, what they call trap houses.
Chris Nahibi:Yeah, yeah.
Saeed Omar:And I'm like, man, how could you feel so comfortable living just one block away from that?
Saeed Omar:You know, it's.
Saeed Omar:It was.
Saeed Omar:It was polarizing.
Chris Nahibi:And those.
Chris Nahibi:Those houses had, like, the copper wire stripped out of them.
Chris Nahibi:People were selling the copper wire and, you know, everything.
Chris Nahibi:Yeah, it was pretty crazy.
Chris Nahibi:But, yeah, you know, Detroit's had a big surgeon come back, though, so they're starting to come back really, really big.
Saeed Omar:I hope so.
Chris Nahibi:Yeah.
Chris Nahibi:A great city.
Chris Nahibi: of: Chris Nahibi:Well, they started to have some pretty notable challenges with office space vacancies surging, particularly as remote.
Chris Nahibi:Remote work trends continue to persist long past where I think a lot of employers thought they would, and certainly short of where a lot of employees thought they would.
Saeed Omar:Right.
Chris Nahibi:So a lot of that, hey, we're going to bring people back to work rhetoric really started in Q2.
Saeed Omar:Okay.
Chris Nahibi:And there were some employees who were like, screw this.
Chris Nahibi:The unemployment rate is below 4%.
Chris Nahibi:I'm just gonna find another job.
Chris Nahibi:Let's be working remote.
Saeed Omar:Yeah.
Chris Nahibi:And then a lot of the rhetoric that we were hearing about that.
Chris Nahibi:That period of time also involved people working two jobs, two remote jobs full time.
Saeed Omar:Yes.
Chris Nahibi:And it became very, very difficult for companies who were not set up to try to recognize that behavior, to try to find it, because there were even tools being sold on Amazon and stories on TikTok showing people how to do it, and people got Very good at scheduling two jobs.
Saeed Omar:So given what you've seen, where you've seen us come from, from, you know, from the, the pandemic era.
Saeed Omar:Right.
Saeed Omar:To where now we're at this point in time in Q2, where the rhetoric of bringing everybody back to the office slowly but surely.
Saeed Omar:Right.
Saeed Omar:There's more hybrid.
Saeed Omar:Right.
Saeed Omar:And to where we are now.
Saeed Omar:You know, how do you see this playing out long term?
Saeed Omar:Do you see a full resurgence of everybody back in the office full time again down the road for the majority of people?
Saeed Omar:Because there is, I know we've talked about on this show, there's, there is a huge element to, you know, collaboration, work together as a team to get work done.
Saeed Omar:But you gotta think just as far as innovation goes and the way technology is going.
Chris Nahibi:Yeah.
Saeed Omar:And where home affordability seems like it's an issue that's gonna persist and stay around for quite some time.
Saeed Omar:So are we really going to lose some of, you know, some great employees in the workforce because they have to move out elsewhere?
Saeed Omar:Do you see hybrid staying for longer or do you.
Saeed Omar:How do you see this playing out for the masses?
Saeed Omar:I mean, not for anything else, but just the majority of companies out there.
Chris Nahibi:Yeah.
Chris Nahibi:I think hybrid is going to be a part of popular American work culture for years to come.
Chris Nahibi:I think there's been a notable and quantifiable shift in the expectations of life work balance for a lot of American workers.
Chris Nahibi:But at the same time, we haven't seen the technology and the human side come up to date with the products and services that are needed to properly build teams and interact with one another.
Chris Nahibi:A great example of this is, yes, you can deploy zoom meetings and have people on camera, but there are a lot of people who don't appear on camera.
Chris Nahibi:There are a lot of people who aren't putting out the same amount of work product they were when they were in the office.
Chris Nahibi:And it's really hard to hold people to the same standard.
Chris Nahibi:You get different levels of performance from different levels of people.
Chris Nahibi:So I think we're going to see more metric driven conversations.
Chris Nahibi:But here's where I put most employees on their heels and I ask a question that's tough and I don't mean this to be polarizing or negative.
Chris Nahibi:I mean it to be serious and a fair question.
Chris Nahibi:But it doesn't come off that way.
Chris Nahibi:If the trade off was you were watched and monitored more while you work, when you work from home, versus you had much more autonomy and flexibility while working in the office, which one would you choose?
Chris Nahibi:Yeah, I think most People don't like the idea of somebody watching them under much more scrutiny.
Chris Nahibi:And they feel that working from home allows them to work without interruption more.
Chris Nahibi:But I feel that people are also somewhat in denial about the liberties they take when they are working from home.
Chris Nahibi:From home.
Chris Nahibi:I'll be the first person to say I don't like getting dressed anymore.
Chris Nahibi:And I never thought I'd say that when I go to work, I should be able to wear sweats.
Chris Nahibi:You should trust me that if I know that I'm going to see clients, that I'm going to get dressed.
Chris Nahibi:But if I'm not going to see clients, it shouldn't matter what I wear.
Chris Nahibi:But you got to have some baseline level of a dress code.
Chris Nahibi:Right.
Chris Nahibi:So I feel there's a happy medium.
Chris Nahibi:Wear jeans, wear hoodies, wear tennis shoes if you want, dress when you're, when you should be appropriate.
Chris Nahibi:But then if you're a company, like a bank, for example, and you've got tellers who are supposed to dress up.
Saeed Omar:You gotta, you gotta understand the role that, the job that you have and the role that you're playing.
Saeed Omar:Right.
Chris Nahibi:And companies need to compensate those people for those inconveniences.
Chris Nahibi:Okay, Right.
Chris Nahibi:If you're inconvenienced to drive to work, you're inconvenienced to get childcare.
Chris Nahibi:The counter argument from a company perspective is you had those costs before, but those costs have changed materially.
Saeed Omar:Oh, yeah, we've talked.
Saeed Omar:It's, it's in all the inflation numbers.
Chris Nahibi:Right.
Chris Nahibi:Well, and think about it too.
Chris Nahibi:If you're, if you're paying for childcare, you know this.
Chris Nahibi: of: Saeed Omar:Yeah.
Chris Nahibi:Because their expenses went up.
Chris Nahibi:Their rent, their utilities, their insurance, all the stuff went up for them.
Chris Nahibi:And they're having less kids go into the program because more people, parents are working from home and keeping their kids home now they got less income and higher expenses.
Chris Nahibi:They've got to raise costs on everybody and they just pass that on to you.
Chris Nahibi:They're not going to absorb the economic loss.
Chris Nahibi:Right.
Chris Nahibi:They're going to try to keep the same amount of earnings.
Chris Nahibi:So that winds up being inflationary.
Saeed Omar:Yep.
Chris Nahibi:And this is a great example of how service costs stayed high for longer.
Saeed Omar:Yeah, we talked about, we talked about on the last episode.
Chris Nahibi:Right.
Saeed Omar:It was that wage price spiral.
Saeed Omar:Right.
Saeed Omar:Where the, maybe that maybe they were dealing at.
Saeed Omar:There was a time where certain industries, certain sectors that I know for a fact that the, in the tech space the engineer space.
Saeed Omar:This was definitely the case where unemployment was too low to.
Saeed Omar:Where companies were paying ridiculous amount of money to some of these engineers just to make sure that they can get them on board.
Chris Nahibi:That's pivoted hard right now, too.
Chris Nahibi:Yeah, it's been a big pivot.
Chris Nahibi:And I think a lot of these engineers are having this come to Jesus reality where they're not going to have the ability to command what they once did.
Chris Nahibi:They would go into some of these companies commanding stock prices, you know, RSUs and grants, and it was just like, it was crazy.
Chris Nahibi:They could command if they wanted.
Chris Nahibi:Yeah, those days have come and gone.
Chris Nahibi: of: Chris Nahibi:So the Fed made its first 25 basis point rate cut in June, bringing rates to 4.25 to 4.5%.
Chris Nahibi:Dissent within the Fed highlighted ongoing inflationary concerns.
Chris Nahibi:Is that right?
Chris Nahibi:25 basis points of the first cut, is that right?
Saeed Omar:No, no, no.
Saeed Omar:So the first, the first rate cut was 50 basis points, and that was in.
Saeed Omar:Actually was in September.
Saeed Omar:So maybe it was.
Saeed Omar:It was still a pause or an increase.
Saeed Omar:It was still a pause at that time.
Chris Nahibi:Yeah.
Chris Nahibi:That's strange.
Chris Nahibi:I don't know.
Chris Nahibi:My notes are probably a little.
Chris Nahibi:Huh?
Saeed Omar:Yeah, we remember that there was a pause during that time because the, the rhetoric was just starting to come out at that point.
Saeed Omar:It's very likely that the Fed was done raising rates even though they had.
Saeed Omar:They hadn't raised rates in quite some time.
Saeed Omar:Right.
Chris Nahibi:I'm trying to.
Chris Nahibi:Four points.
Chris Nahibi:Yeah.
Chris Nahibi:50 basis points.
Chris Nahibi:Yeah.
Chris Nahibi:Announced that day.
Chris Nahibi:That's weird how my notes are all messed up.
Chris Nahibi:I apologize.
Chris Nahibi:But yeah, it was the first one.
Chris Nahibi:50 basis points went from 4.75, 4.5 down to 4.25.
Chris Nahibi:Right?
Saeed Omar:No, no, it went from.
Saeed Omar:It went from 5.5 down to 5.
Saeed Omar:That was the first one, remember?
Saeed Omar:And then they went another 25.
Saeed Omar:And then they went another 25, another 25 in November and then another 25 in December.
Chris Nahibi:Yeah, I got to pay more attention whenever I write notes for shows.
Chris Nahibi:It's late.
Chris Nahibi:Yeah.
Chris Nahibi:It's like, I blame you.
Saeed Omar:Yeah.
Saeed Omar:So we're here to fact check each other.
Saeed Omar:But the rhetoric was just now starting to become clear that although they hadn't come out the gate and said, we're officially done raising rates, that it was no longer an option on the table during those post game press conferences that Jerome Powell was coming out saying, and that that provided a little bit of relief to everybody because it had signaled officially that we had reached phase two of this approach where we're officially done with the raising of the rates.
Saeed Omar:We're now in this phase two where we're going to now just try to figure out how long are we going to stay in this period at this high interest rate.
Chris Nahibi:Right, Yep.
Chris Nahibi:Meanwhile, politically, we entered into June where the election year rhetoric really started to get cadence and pick up.
Chris Nahibi:Because it had been relatively silent up until that point, people were more worried about the overall macro economy.
Chris Nahibi:They worried about the political one.
Chris Nahibi:Candidates started outlining their economic policies with debates around taxes, spending and regulation impacting market sentiment.
Chris Nahibi:Obviously, the economic markets were a big point of conversation for all parties.
Chris Nahibi:And at this point in time, you still had Biden running as your main presidential candidate and Trump was certainly on the rise.
Chris Nahibi:Right.
Chris Nahibi:When did, when was Trump shot in the ear?
Saeed Omar:Oh, that was like two months out, right?
Chris Nahibi:Yeah, it was a little late in the year, so I'd say about like two months ago.
Chris Nahibi:I have it right here.
Saeed Omar:Two months ago.
Saeed Omar:Right.
Chris Nahibi: ,: Chris Nahibi: minee of the Republican Party: Saeed Omar:On my birthday.
Chris Nahibi:So literally it was your birthday.
Saeed Omar:Yeah.
Chris Nahibi:I should know when your birthday is.
Saeed Omar:I don't, I don't remember that.
Chris Nahibi:Yeah, yeah.
Chris Nahibi:So literally the very, very beginning of Q3, that, that's when that happened.
Chris Nahibi:That changed the narrative entirely as it relates to Trump, as far as I'm concerned.
Saeed Omar:Yeah.
Chris Nahibi: ,: Chris Nahibi:As we just covered, volatility returned the VIX spike to its second largest one day increase in history.
Chris Nahibi:Investor uncertainty grew amid mixed economic signals.
Chris Nahibi:And then there was a market reaction.
Chris Nahibi:Defensive sectors like utilities and healthcare gained ground as growth stocks cooled off a little bit.
Chris Nahibi:So we started to see a bit of a paradigm shift.
Chris Nahibi:In number one, fear in the market was started to rise.
Chris Nahibi:And number two, you started seeing some sectors begin to cool off and in some ways signal that the Fed cycle had impacted them and may be working.
Saeed Omar:Right.
Chris Nahibi:But we still weren't sure.
Chris Nahibi:There was very incremental gains in around that time.
Chris Nahibi:Meanwhile, housing, housing affordability crisis became front and center of the conversation, not only politically, but in all the conversations that relates to the Fed rate cuts at this point in time, you hadn't had one.
Chris Nahibi:But housing affordability, you started to have the Narrative from the National Association Realtors kick up the solution to affordability crisis is rates go down.
Saeed Omar:That's.
Saeed Omar:Yeah, that's always their solution.
Chris Nahibi:That's the only way this gets better, guys.
Chris Nahibi:Rates go down.
Chris Nahibi:Prices remained high and buyers faced increasingly increasing affordability challenges where the national association of Realtors and everybody else in the real estate real estate community said, don't worry, this will all get solved when they cut rates, rates will come down.
Chris Nahibi: , that did not happen through: Chris Nahibi:As a matter of fact, rates ended the year higher than they started the year, around six and a half.
Chris Nahibi:They floated up and they floated down and they're ending the year at least it looks like as of right now when recording the show again.
Chris Nahibi:We're recording the show a little bit early Wednesday the 18th, two weeks out, it appears to be ending around 7%.
Chris Nahibi:And with today's sharp spike in the 10 year, I expect the rates to be a little higher.
Saeed Omar:I expect it to go up even a little bit higher than where they are now.
Saeed Omar:Yeah, yeah.
Chris Nahibi: of: Chris Nahibi:And obviously you had a flooding of high end luxury apartments coming to the market.
Chris Nahibi:But those rents were wildly high but still cheaper than buying.
Chris Nahibi:We found out in and around late of Q3 that buying actually costs approximately 42% more than renting.
Saeed Omar:Right.
Saeed Omar:And I think that was around the time too where we noticed that it officially costs more to rent than to buy in like all 50 states.
Saeed Omar:Right?
Chris Nahibi:Yep.
Chris Nahibi:And as we covered earlier, the Federal reserve finally cut 50 basis points.
Saeed Omar:Yes.
Chris Nahibi:See my notes are right.
Chris Nahibi:I just had to read them all.
Chris Nahibi:Well, this rate cut in September aligned with their dual mandate goals.
Chris Nahibi:This despite inflation stubbornness, they felt that they were on their way down to.
Chris Nahibi:Prior to this though, they had said they weren't going to cut rates until they hit the 2% target.
Chris Nahibi:This marked a very material and clear change in their stance and a long line of the FOMC saying they were going to do things specifically but being a little loose with the execution.
Saeed Omar:And I think that it, it provided a huge shock to everybody when they came out the gate with that 50 point cut right away.
Saeed Omar:It was not as if the economy needed a 50 basis point cut to really start stimulating the economy again.
Saeed Omar:The economy had been performing very well according to the Bureau of Labor Statistics.
Chris Nahibi:And it seemed to be like a fear based reaction by the FOMC to cut that much that early, but they had increased rates at 75 basis points it increased rates at a pretty heavy cadence, you know, over the course of the previous year.
Saeed Omar:So it was almost like they knew some of the data points that they were relying on were skewed and were like, oh, shit, you know, we thought that the labor market was a lot stronger than it actually is.
Saeed Omar:Maybe we provide a little bit of relief.
Chris Nahibi:But they almost immediately cut back that.
Chris Nahibi:That rate cutting methodology where we've had, you know, now three.
Chris Nahibi:Three meetings in a row.
Saeed Omar:Mm.
Chris Nahibi:So is it September, October, December or September, November, November.
Chris Nahibi:Yeah.
Chris Nahibi:Yeah.
Chris Nahibi:So September 20, 50 basis points.
Chris Nahibi:November, December 25 each.
Chris Nahibi:So we've cut a full point since that time.
Chris Nahibi:And certainly a lot slower cadence than the way up.
Saeed Omar:Absolutely.
Chris Nahibi:Which I think when the market first saw the 50 basis point cut in September, they're like, oh, here we go.
Chris Nahibi:Right.
Chris Nahibi:They're going to cut 75 basis points.
Chris Nahibi:Going to cut 50 basis points.
Chris Nahibi:Going to be big cuts.
Chris Nahibi:Big cuts, big cuts.
Saeed Omar:Time to party.
Saeed Omar:Right.
Chris Nahibi:Yeah.
Chris Nahibi:Those didn't come and the party never started.
Saeed Omar:Right.
Saeed Omar:Unlike other parties.
Chris Nahibi:Yeah.
Chris Nahibi:Which never stopped.
Saeed Omar:Yeah.
Chris Nahibi:So, you know, it's going to be a shocker.
Chris Nahibi:But the political zeitgeist in and around the end of Q3, well, budget standoffs were once again rearing their ugly head.
Chris Nahibi:The government shut down.
Chris Nahibi:Threats added to uncertainty impacting markets and consumer confidence.
Chris Nahibi:Oh, my God, they're going to shut down.
Chris Nahibi:The market said, oh, my God, we're going to hit the.
Chris Nahibi:We're going to hit the debt ceiling.
Chris Nahibi:We're going to shut down.
Chris Nahibi:We didn't.
Saeed Omar:We didn't.
Saeed Omar:Everything ended up being just fine.
Chris Nahibi:Yeah.
Chris Nahibi:Gummies and lollies.
Saeed Omar:Yeah, gummies.
Saeed Omar:Record numbers across the S&P.
Saeed Omar:500, the Dow.
Saeed Omar:Right.
Saeed Omar:Everything still was on the up and.
Chris Nahibi:Up, as we say in the business.
Chris Nahibi:Everybody was banging out, everybody was in the black, everybody was making that money.
Chris Nahibi:So in a lot of ways, it's kind of still are.
Chris Nahibi:Even today, we haven't seen.
Chris Nahibi:We've seen a resilience in the economy that seems almost unjustifiable.
Saeed Omar:It doesn't really make a whole lot of sense.
Saeed Omar:Right.
Chris Nahibi:It does.
Chris Nahibi:You think so people really downplay the impacts of emotional responses to things, and people right now don't believe it.
Chris Nahibi:You know, so because they don't believe it, they're going to continue to push through because they've been confident, they've got bravado, they got swagger.
Saeed Omar:I mean, some of this could also.
Saeed Omar:We gotta, we gotta give some of the, the CPAs out there, the accounting majors, a little bit of credit too.
Saeed Omar:There's Some accounting tricks up people's sleeves to make sure that the numbers look a little bit better than they actually are.
Saeed Omar:Right?
Chris Nahibi:Yeah.
Chris Nahibi:I mean, in some ways.
Saeed Omar:Yeah, in some ways, right.
Saeed Omar:For sure.
Saeed Omar:So they can buy themselves a little bit of time.
Chris Nahibi:And that's what a good financially savvy person will do.
Saeed Omar:100%.
Chris Nahibi:And you try to have belief in yourself and grow your business in good times and in bad times.
Chris Nahibi:And a lot of people think they've lived through bad times when they haven't really lived through them, economically speaking.
Chris Nahibi:And they're just now feeling that, that stress.
Chris Nahibi:And I think they thought that, okay, if I can just get to the rate cutting cycle, that stress will be gone.
Chris Nahibi:And in fact, it's gone the other way.
Chris Nahibi:Just because the fed funds rate has cut does not mean that your interest rate on loans has been cut.
Chris Nahibi:As a matter of fact, it's gone up.
Saeed Omar:Yeah, exactly.
Chris Nahibi: So entering into: Chris Nahibi:And as we end the year, there was a year end rally.
Chris Nahibi:Santa Claus rally lifted markets, but gains were uneven with tech rebounding and energy lagging.
Chris Nahibi:The S&P 500 performance was interesting.
Chris Nahibi:The index closed the year with a modest gain reflecting resilience despite headwinds.
Chris Nahibi:And we still got some more time to go, but certainly not a hyper well performing S&P 500 year outside of, you know, a couple stocks.
Saeed Omar:I mean, up year to date right now, up 23% on the year s and P500.
Chris Nahibi:Yeah.
Chris Nahibi:How did it do today?
Saeed Omar:How did it do today?
Saeed Omar:Yeah, it was down 3%.
Chris Nahibi:Okay.
Chris Nahibi:And of the S&P 500, how many of them are up 23%.
Saeed Omar:Right.
Saeed Omar:I mean, that's a whole nother conversation.
Chris Nahibi:You're getting lifted by a minority.
Saeed Omar:Yeah, There needs to be an index on the S&P493.
Saeed Omar:Yeah, that's what we need to see.
Chris Nahibi:Because the top seven are pretty much carrying everybody.
Saeed Omar:Oh yeah.
Saeed Omar:Oh yeah.
Chris Nahibi:So, but let's, let's look into real estate.
Chris Nahibi:You know, existing home sales have fallen.
Chris Nahibi:The number of sales transactions hit a decade low as buyers struggle with the affordability they struggle with.
Chris Nahibi:All year long transactions have largely stalled out.
Chris Nahibi:Shrinkflation inflation.
Chris Nahibi:Consumers continue to face rising costs of shrinkflation impacting holiday spending.
Saeed Omar:Can't believe you questioned me on this.
Chris Nahibi:I just questioned you on the Doritos and toilet paper.
Chris Nahibi:Toilet paper.
Chris Nahibi:I just thought that was a strange reference to make.
Chris Nahibi:At the same time, seems like you got some digestive issues.
Saeed Omar:You were trying to work clearly not paying attention to my gut health.
Chris Nahibi:Yeah.
Chris Nahibi:And I just didn't feel like calling you out on the show and blasting you for it.
Chris Nahibi:So I just dismissed the conversation its entirety.
Chris Nahibi:And then when I felt it was appropriate, I brought it back up and utilized your same references to make you sound.
Saeed Omar:Gave me credit.
Saeed Omar:Right?
Chris Nahibi:I mean, you kind of took credit.
Saeed Omar:But I did, I took it.
Chris Nahibi:It was mine.
Saeed Omar:It was mine for the taking.
Chris Nahibi:Giving is an interesting choice.
Saeed Omar:Okay?
Chris Nahibi:It's giving bullshit.
Chris Nahibi:Federal Reserve rate cut to end the year.
Chris Nahibi:We covered it last episode.
Chris Nahibi:The December rate cut was interesting not because the 25 basis points was unexpected, but because they cut their forecasted projection from 4 cuts down to 2.
Chris Nahibi:Leading people to believe that we're going to.
Saeed Omar:For the upcoming year.
Chris Nahibi:Right.
Chris Nahibi: Upcoming year: Chris Nahibi:So leading a lot of people to believe that monetary policy is going to be stricter, tighter, more challenging for longer.
Saeed Omar:And some terms were thrown around the rate hikes.
Saeed Omar:I mean that term.
Saeed Omar:You hadn't heard that in quite some time.
Saeed Omar:We're, we're not, we're not yet thinking about rate hikes.
Saeed Omar:Then why'd you say it?
Chris Nahibi: , however small or remote, in: Saeed Omar:And we, I said this, I said this on the, on the show before and, and so have you that you didn't want to take a misstep.
Saeed Omar:And I think that this last rate cut that we just experienced, this could have been their first major misstep.
Saeed Omar:Right?
Saeed Omar:Major one.
Saeed Omar:The 50 basis points.
Saeed Omar:Fine.
Saeed Omar:25 still, eh.
Saeed Omar:But this one could have been a real big problem because the fear is you took something that was a four year problem and you may now have just made it a decade problem.
Chris Nahibi:Yeah, I think that's probably a fair assessment.
Chris Nahibi:I also think that there has been a lot of things politically which has worked against the fomc.
Chris Nahibi:So I will give them a bit of a asterisk here in that.
Chris Nahibi:I mean the Inflation Reduction act when they passed, that was known to actually increase inflation near term.
Saeed Omar:Well, government spending.
Saeed Omar:Exactly.
Chris Nahibi:Yeah.
Chris Nahibi:And government spending has been out of.
Saeed Omar:Control because anytime you, you do anything to create more jobs that pays people more and ultimately that all that money gets funneled back into the economy.
Chris Nahibi: I think the last year,: Chris Nahibi:I think that there's been a pretty big gap in life and how things have changed from a technology perspective.
Saeed Omar:Okay.
Chris Nahibi:I would say the home buying process 20, 30 years ago was a lot different than it is today.
Saeed Omar:Oh yeah.
Chris Nahibi:There's a lot more technology, a lot more people have access to homes than they once did.
Chris Nahibi:There's also a lot more different properties out there.
Chris Nahibi:I think that the data and the way we report on these transactions hasn't kept up.
Chris Nahibi:Any Realtor in your neighborhood can go check their local MLS and get an idea for number of listings, number of sold properties instantly in real time.
Chris Nahibi:And I understand that's the national association of Realtors database, but if that's out there as a tool, why can't the federal government get access to that information at a faster cadence?
Chris Nahibi:Why, why, why are we relying on things like owners rent equivalent?
Chris Nahibi:So some of the data sources that we're looking at historically might not make sense anymore for today's world.
Chris Nahibi:Technology, Infrastructure, social challenges.
Chris Nahibi:It just seems to me that, that there are better sources.
Chris Nahibi:We have a private payroll and we have a government Bureau of Labor Statistics payroll that comes out and they're very different reports.
Saeed Omar:Oh yeah.
Saeed Omar:Paints two completely different pictures.
Chris Nahibi:And I understand how, how and why that could be, but we need to find ways to reconcile and be more efficient.
Chris Nahibi:Shout out to Doge.
Chris Nahibi:Yeah, Department of Government Efficiency on how to get this information and how to use it.
Chris Nahibi:Because right now you've got too many sources of antiquated information coming in.
Chris Nahibi:Too slow.
Chris Nahibi:Yeah, it's just what it is.
Chris Nahibi:At the same time, in the reference to Doge, you've got a presidential campaign that was successful for the incumbent, Donald Trump.
Chris Nahibi:And well, he won.
Chris Nahibi:And now he's talking about and has announced that he's making some pretty significant departures from traditional political choices, electing to choose people that he thinks are the best suited individual, not necessarily the best suited politician for jobs.
Saeed Omar:A lot of conversations around tariffs on day one, tariffs on Mexico, tariffs on China, out the gate.
Chris Nahibi:He's shown a cadence in a history in the past of being more aggressive.
Chris Nahibi:But what's going to be interesting to see is how Vivek Ramaswamy, Ramaswamy and Elon Musk handle the Department of Government Efficiency.
Chris Nahibi:They've promised some pretty interesting and dynamic changes to the government as a whole.
Chris Nahibi: ivic came out after reading a: Chris Nahibi:And then you had Elon getting on top of it.
Chris Nahibi:And what I found was really interesting and I found fascinating was you had two non politicians read a bill.
Chris Nahibi: e home was one, this bill was: Chris Nahibi:It could have been written in 20.
Chris Nahibi:Number two, there were lots of things baked in and hidden into it.
Chris Nahibi:And an artificial deadline created to get this done before the holiday break for Congress in the House so that they could pass it by getting these other issues not looked at with the screening that they probably deserved.
Chris Nahibi:And then if that's your take home on this bill and that's your take, number one, it's not efficient.
Chris Nahibi:Number two, you're playing manipulative games, you're manipulating time, and you're using a bill with a headline to get other things which include salary increases from some of these people.
Saeed Omar:Oh, yeah.
Chris Nahibi:And, and it was just clear.
Chris Nahibi:I mean, he.
Chris Nahibi:Vivek clearly read the entire thing.
Chris Nahibi:And now you've got Vivek and Elon Musk on X openly talking about their criticisms of this particular bill.
Chris Nahibi:I can't remember the last time I got such a K.
Chris Nahibi:I mean, I'm not, I'm not co signing.
Chris Nahibi:I'm just saying it's kind of stunning to get an outside person who's intelligent, look at this, articulate it to you with no political spin like, this is just not efficient and inappropriate.
Saeed Omar:It's really interesting too, as you mentioned that it made me think about, okay, this.
Saeed Omar:One of the guys heading the Department of Government Efficiency is choosing to use one of his own platforms, his company, to relay some of these messages.
Saeed Omar:And he's benefiting a whole lot off of this.
Chris Nahibi:Elon Musk.
Chris Nahibi:Yeah, well, I mean, like it or not, social media has become the preferred news choice and source for, for most Americans.
Saeed Omar:You don't have just.
Saeed Omar:I'm just asking a question.
Saeed Omar:Right?
Saeed Omar:I don't, I don't have a horse in the race.
Chris Nahibi:I don't know that that benefits him per se.
Saeed Omar:Come on, there's a benefit there.
Saeed Omar:Let's not act like there's no benefit.
Chris Nahibi:That's his choice of communication.
Chris Nahibi:Yeah, sure, I get it.
Chris Nahibi:But, you know, is he gonna get more advertiser dollars on X because of it?
Chris Nahibi:I doubt it.
Chris Nahibi:I mean, Disney pulled out.
Chris Nahibi:I mean, a lot of people pulled away from him.
Chris Nahibi:I mean, him and Bob Iger had that wild, you know, go fuck yourself when he, you know that.
Chris Nahibi:When he was referring to Bob Iger.
Chris Nahibi:Remember that?
Chris Nahibi:I forgot about referring to Disneyland.
Saeed Omar:Yeah, we, we forgot.
Saeed Omar:We got to mention that on the.
Chris Nahibi:2024, Disney pulled their advertising when, when Elon Musk bought Twitter for $44 billion.
Chris Nahibi:What the hell?
Saeed Omar:It was, hey, Bob.
Chris Nahibi:And they asked him to Respond in an open public conference and his response was go fuck yourself.
Saeed Omar:Right.
Saeed Omar:And, and then it got silent.
Saeed Omar:He doubled down.
Chris Nahibi:That's right, yeah.
Chris Nahibi:He said go fuck yourself.
Chris Nahibi:And I get it, he's you know, the rich man in the world.
Chris Nahibi:He had, he had a net worth go over 400 billion I think it was recently.
Chris Nahibi:Yeah, it was, it's the first time anybody's ever crossed that number.
Saeed Omar:Mainly through his SpaceX because guaranteed him some government contracts.
Chris Nahibi:He caught a rocket that returned back to, to earth from the site that it launched.
Saeed Omar:As far as I'm concerned, it's worth every dollar.
Saeed Omar:Right.
Chris Nahibi:That's wild.
Saeed Omar:That's impressive.
Chris Nahibi:That's sci fi.
Saeed Omar:That is very impressive, but it's not fiction.
Saeed Omar: y with, with the rate cuts is: Chris Nahibi:Yeah, that's the first thing.
Chris Nahibi:So whenever banks cut, whenever fed funds rate cut does come, the first thing it changes is not your loan rates going down, it's actually your loan rates in place stay the same and new loan rates will respond to the Treasuries which have not gone down.
Chris Nahibi:So loan rates have gone up or stayed the same, but the cost benefit to you and your rates at your deposit accounts go down almost instantly.
Saeed Omar:Right.
Chris Nahibi:Unless you're in a CD product where there's a contractual obligation to keep you.
Chris Nahibi:Right, right.
Saeed Omar:For extended period of time.
Saeed Omar:So banks are going to maintain their profitability.
Saeed Omar:Right.
Chris Nahibi:They're going to try to increase their net interest margin which is the difference between what they're paying you on your deposits and what they're getting on loans.
Saeed Omar:So with the, their borrowing costs becoming less, you shouldn't expect for to get better interest rates so soon.
Chris Nahibi:No, the, the market is really driving that and banks are really being responsive to it.
Chris Nahibi:But there is no right now banks are going to lower their cost of funds which is paying less on deposits to the extent that they can while keeping their return on their investments into loans as high as possible.
Saeed Omar:Right.
Saeed Omar:And you're not going to get this big letter message or pop up on when you log in online.
Saeed Omar:It's going to be anecdotally mentioned just on your statement.
Chris Nahibi:They generally have a right to do so at any point in time and it's usually done automatically, which, you know, I get it.
Chris Nahibi:Rates are one of those things that got really, really a lot of scrutiny in the last couple of years because for a long period of time you got almost nothing for your deposits.
Chris Nahibi:They would Pay you nothing.
Saeed Omar:Yeah.
Chris Nahibi:And then it was 1%.
Chris Nahibi:People were like, ah, 1%.
Chris Nahibi:You know, I should probably move my money around.
Chris Nahibi:Yeah, 1%.
Chris Nahibi:There was 2%.
Chris Nahibi:People like, oh, yeah, that's good money.
Chris Nahibi:There was 4%.
Chris Nahibi:People like, I need to move my money now when he had 5%.
Chris Nahibi:People are like, look like you're gonna be the best right here.
Chris Nahibi:I'm gonna go across the street and get the best.
Saeed Omar:It's not right.
Saeed Omar:Because if, if, if you invest in the stock market and on average you can get somewhere between 7 to 8%, then, I mean, you get a guaranteed 5% over here in this high yield savings account.
Chris Nahibi:Zero risk.
Saeed Omar:Zero risk, Right.
Chris Nahibi:Not even like perceived risk or like incremental risk.
Chris Nahibi:It was just no risk.
Saeed Omar:So right now you're technically not in the wrong if, if your bank drops your high yield savings account to somewhere around, you know, four and a quarter, right.
Saeed Omar:Even 4%.
Saeed Omar:You're not in the wrong if you wanted to continue to keep it there because you're still beating inflation, right?
Chris Nahibi:Yeah.
Chris Nahibi:And that's the name of the game, right, is beat inflation at all costs.
Chris Nahibi:But that, that landscape is going to change pretty dynamically in the banking space over the next couple years.
Chris Nahibi:I think banks in financial services businesses are, are now on the downside slope of a very difficult time.
Chris Nahibi:But I think that, that other people will start to feel the pressure while banks are coming out of it.
Chris Nahibi:Keep in mind, on the upward swinging cost of when they start to get more restrictive on fed funds and that goes up as fast as it does.
Chris Nahibi:Banks are on the front line of that pain point.
Saeed Omar:Okay.
Chris Nahibi:So banks experience at first, but then they get relief first as well.
Saeed Omar:Good.
Saeed Omar:So need that relief.
Saeed Omar:Yeah, well, you know, anything, the instant relief.
Chris Nahibi:Anything to help you feel better about you.
Saeed Omar:Thank you, man.
Chris Nahibi:We should do ayahuasca on the show.
Saeed Omar:You're not down.
Chris Nahibi:I'm not down.
Chris Nahibi:But if with a proper shaman, with.
Saeed Omar:The pro, who did I get to pick?
Saeed Omar:The shaman?
Chris Nahibi:No.
Saeed Omar:Why?
Chris Nahibi:Because you think shaman is toilet paper?
Saeed Omar:No, no, I'm gonna.
Saeed Omar:Neil Brennan.
Chris Nahibi:Neil Brennan.
Saeed Omar:Come on.
Saeed Omar:This is the second time I brought him up on the show.
Chris Nahibi:Who's Neil Brennan?
Saeed Omar:He's that comedian, the right hand to Dave Chappelle.
Chris Nahibi:Why would he be the.
Saeed Omar:He's done it like 15 times.
Chris Nahibi:That doesn't.
Chris Nahibi:Okay.
Chris Nahibi:The heroin addict is heroin.
Saeed Omar:I just feel like it would be an amazing trip.
Chris Nahibi:I don't think so.
Chris Nahibi:You know, there's an interesting thing that they're seeing happen with ayahuasca and like some People who've done some psychedelics is that there are some people who, and the answer here is unclear, who will have these experiences, come back from them and be a completely different person when they come back.
Saeed Omar:That happened to Neil.
Saeed Omar:So he literally was the same person for a majority of the time for like 13 of them, let's say.
Saeed Omar:And known agnostic person.
Saeed Omar:Right?
Chris Nahibi:Yeah.
Chris Nahibi:Came back, saw God.
Saeed Omar:He said, I don't.
Saeed Omar:I like very.
Saeed Omar:No, outspoken about being agnostic.
Saeed Omar:Right.
Saeed Omar:And after the 14th time he came back and it was like, I don't know what that was, but I was definitely in the presence of God.
Chris Nahibi:Yeah.
Chris Nahibi:And so there's two prevailing theories that I think are both very reasonable.
Chris Nahibi:Is one, it, you know, you just have an experience and it changed the way you see things sometimes for better or for worse.
Chris Nahibi:Some people come back just completely different, like in a bad way.
Chris Nahibi:And then there's a good argument which I think makes sense.
Saeed Omar:They're locked in.
Saeed Omar:They stay, they stay that way.
Chris Nahibi:Yeah.
Chris Nahibi:Like you're not going to.
Chris Nahibi:Oh, the chemicals are going to wear off.
Chris Nahibi:No, no, you're, you're.
Chris Nahibi:That, you're that person.
Saeed Omar:And that's.
Saeed Omar:For that reason I will never try it.
Chris Nahibi:The other theory which is interesting is that you have a preexisting disposition already in place to being like depressed or having some type of psychological issue.
Chris Nahibi:And all this does is it ultimately brings out that pre existing condition.
Saeed Omar:Right.
Saeed Omar:If you have trauma that you haven't really worked through.
Chris Nahibi:Yeah.
Saeed Omar:This is not it for you that you got to work that out first?
Chris Nahibi:Well, I think part of this is a trauma dealing experience, but so I was listening to.
Chris Nahibi:I think it was Huberman or somebody talking about this.
Chris Nahibi:They don't really know how this all works.
Chris Nahibi:They fully don't understand how the psychedelics are so impactful to people.
Chris Nahibi:But we, we've stigmatized a lot of drugs in this country in a way that's really strange.
Saeed Omar:So correct me if I'm wrong.
Saeed Omar:Have you look, gone down this path and looked into it?
Saeed Omar:No, no, I'm saying like read, read about it or.
Chris Nahibi:Yeah.
Saeed Omar:So from my understanding, and I can't remember if it was ayahuasca or not, but there's a certain chemical release in the brain that generally only happens twice naturally in a human being's lifetime.
Chris Nahibi:Yeah, once.
Saeed Omar:Once when you're born and once when you die.
Chris Nahibi:Ayahuasca.
Saeed Omar:And then ayahuasca will give this same relief or same chemical release.
Chris Nahibi:Huh?
Saeed Omar:Right.
Saeed Omar:So I think that's the euphoria that.
Chris Nahibi:That is part so it's interesting, too.
Chris Nahibi:I don't know if you ever seen how ayahuasca is made?
Chris Nahibi:No, I haven't, but it's not one plant.
Chris Nahibi:It's actually two plants combined.
Chris Nahibi:Because if you were to have one of the plants that you used to make ayahuasca, your body would just digest it, it would pass it through, but the other plants you mix it with actually blocks the enzymes, which would just have you pass it through from a digestive point and allows it to get into your bloodstream.
Chris Nahibi:So it's fascinating to me to see how this.
Chris Nahibi:This chemical concoction of two plants mixed together and effectively cooked into this concoction.
Saeed Omar:Right.
Chris Nahibi:Has been around for so long, but somebody at some point in time had to take one plant and the other plant and say these two things on their own or like, whatever.
Chris Nahibi:But when you mix them together and they're amazing, like, who.
Chris Nahibi:Who came up with that?
Saeed Omar:Yeah, it has been.
Saeed Omar:I know.
Saeed Omar:And it probably stemmed from a time and place where way before technology was even a thing.
Chris Nahibi:Yeah.
Chris Nahibi:I mean, there's.
Chris Nahibi:I mean, if you.
Chris Nahibi:If you follow.
Saeed Omar:Mind you, none of this is recommended.
Chris Nahibi:By the Higher Standard podcast or it's all recommended.
Chris Nahibi:You be the judge.
Saeed Omar:Yeah.
Chris Nahibi:If you go back and look at Graham Hancock's series Ancient Apocalypse, where he talks about him believing that there was a.
Chris Nahibi:A cataclysm that wiped out a previous version of humanity that to this day, we still don't fully understand.
Saeed Omar:Right.
Chris Nahibi:He.
Chris Nahibi:He goes back in pretty deep detail, talking, you know, in some cases, ruins that are 13,000 years old that suggest that ayahuasca is a big part of ceremonial culture that has similarities to other cultures all across the world.
Chris Nahibi:So it's not like just the Mayan or, you know, these different tribes and cultures in, you know, Southeast Asia or in Turkey, in.
Chris Nahibi:In the, you know, the Middle east, they all have similar parallels and they all seem to have the same imagery.
Chris Nahibi:And some of these images relate to things like ayahuasca.
Chris Nahibi:Wow.
Chris Nahibi:What's really fascinating, too, is you also have, like, these stones that have, like, color mixed in with a type of natural occurring chemical which effectively crystallizes.
Chris Nahibi:So these drawings inside of rocks have crystallized and stayed there for tens of thousands of years.
Saeed Omar:Wow.
Chris Nahibi:And they've gone back and looks at some of these drawings that were just like squares.
Chris Nahibi:And those drawings actually happen to be timing moon cycles over the course of not.
Chris Nahibi:Not one year, not five years, not 10 years, thousands of years.
Chris Nahibi:And people just assume that humans at that point in time were hunter gatherers well, right.
Chris Nahibi:They seem to have a lot more going on.
Saeed Omar:Yeah, yeah.
Saeed Omar:That's the aspect of being in a digital world.
Saeed Omar:Now that, that scares me too.
Saeed Omar:Whereas like things like that aren't being implemented to where if, if a civilization were to be wiped out that I remember listening to, there was a botanist on the Rogan podcast.
Chris Nahibi:Joe Rogan.
Saeed Omar:Joe Rogan.
Saeed Omar:Joe Rogan, right.
Saeed Omar:And he said that theoretically it would only take a thousand years for agriculture to take over and make it seem like we were never here.
Chris Nahibi:Yeah, that's actually an interesting one.
Chris Nahibi:So have you ever liked research like the Amazon?
Saeed Omar:No, not, I mean, not researched it, but I've heard, I mean I've listened to a few things.
Chris Nahibi:So the Amazon they believe to be.
Chris Nahibi:Now the prevailing theory is that it was manufactured, humans built it.
Chris Nahibi:Oh there's, there's a type of.
Saeed Omar:That's the, the theory now.
Chris Nahibi:Yeah.
Chris Nahibi:So they've flown lidar technology, laser technology.
Chris Nahibi:Now they can put it on drones.
Chris Nahibi:It's small enough to fit on drones.
Chris Nahibi:And they found lots of these monoliths, these large, you know, formations of geometric figures in the ground.
Chris Nahibi:But they've also found entire cities that they believe supported millions of people.
Chris Nahibi:When I say cities, I'm talking like sewers, roads, wow.
Chris Nahibi:Interconnected cities.
Chris Nahibi:In the Amazon they did not, they didn't even know were there.
Chris Nahibi:These cities appear to date back thousands of years.
Saeed Omar:Wild to think that we're still discovering this stuff and.
Chris Nahibi:Yeah, well, yeah, there's, it's fascinating when you get into the overall exploration of the country.
Chris Nahibi:Like so back in the Sahara Desert, for example, prior to the cataclysms was a lush like garden tropical area.
Saeed Omar:It was not a desert exactly, but.
Chris Nahibi:We'Ve only explored like a small percentage of it, like less than 10, I believe.
Chris Nahibi:So there's obviously tons of possibilities of what is likely there, but we just don't know it.
Saeed Omar:I know there's something like that too.
Saeed Omar:Where with the Egyptian pyramids that right now it looks like around there there was, there was no agriculture but if you there they were able to track that was lidar.
Chris Nahibi:So they use lidar to, to look at it.
Chris Nahibi:And the Nile was closer to the pyramids and it shifted over away from the periods.
Saeed Omar:There you go.
Saeed Omar:And they figured out that there was agro, they had berries and whatnot.
Saeed Omar:You could tell that.
Saeed Omar:No, no, there was civilization living around here.
Chris Nahibi:You know, there's a.
Chris Nahibi:They found.
Chris Nahibi:I don't know if you ever like follow the pyramids, but in, in Giza, the Great Pyramid, there's a Grand Gallery, which is.
Chris Nahibi:I think it's just above the king's chamber.
Chris Nahibi:Yeah, just above it.
Chris Nahibi:They found another chamber above it which they haven't opened up.
Chris Nahibi:And people are like, well, why haven't you opened it up?
Chris Nahibi:Like, well, we don't want to, like, damage anything.
Chris Nahibi:Like, why don't you just drill a hole and send a camera through just to see what's in there.
Saeed Omar:Right.
Chris Nahibi:There's so many things like this, I could probably go on for hours on a different podcast.
Chris Nahibi:But there's.
Saeed Omar:Wait, so you.
Saeed Omar:So I know you've done your research on this.
Saeed Omar:Yeah, I know that there's something to do with this.
Saeed Omar:I haven't gone into that guy's name that went on Rogan's podcast a whole bunch of times.
Saeed Omar:It talks about the pyramids all the time.
Saeed Omar:Hancock.
Chris Nahibi:Some Graham Hancock does Hancock.
Saeed Omar:Right.
Saeed Omar:What's the.
Saeed Omar:What's the thing with all the points of the pyramids?
Chris Nahibi:Oh, they.
Chris Nahibi:Well, so the pyramids you've seen today don't have the.
Chris Nahibi:Like, the limestone exterior.
Chris Nahibi:They believe that were there.
Chris Nahibi:So they believe the limestone exterior is polished.
Saeed Omar:I see.
Chris Nahibi:So it almost had like a.
Chris Nahibi:Like a mirror, like, reflection.
Saeed Omar:Oh, wow.
Chris Nahibi:And one of the guys, not Grand Hancock, but another guy who.
Chris Nahibi:Who thought.
Chris Nahibi:He thought there was a mechanical purpose for the pyramids, basically, that if you start looking at some of the geometric shapes, some of the way the tunnels go through, he thought they produced energy using heat, like energy plants.
Saeed Omar:Okay.
Chris Nahibi:Using, like, captured gases and, like, water.
Chris Nahibi:That's why all these.
Chris Nahibi:These pyramids are over water sources.
Saeed Omar:Okay.
Chris Nahibi:He believes they're an ancient energy source, and that's why you typically see these over water every time you see these pyramids all across the country.
Chris Nahibi:Like, they're always over water sources, natural occurring water sources.
Saeed Omar:Oh, interesting.
Chris Nahibi:So his.
Chris Nahibi:That's.
Chris Nahibi:I mean, it's unsubstantiated, and I don't know how you ever substantiate it, but he's gone so far as to, like, take different types of gas and find the wavelength that we need to go through.
Chris Nahibi:And the wavelength happens to match the actual width of the tunnels and the tubes going into the chambers and the different chambers that hold different levels of gas.
Chris Nahibi:And it's interesting.
Chris Nahibi:And there's one guy who went on.
Chris Nahibi:I think it was on Rogan a while back.
Chris Nahibi:I can't remember who it was, but he actually laid down in one of the.
Chris Nahibi:The.
Chris Nahibi:The sarcophagus, like, tombs that you lay down in it.
Saeed Omar:Okay.
Chris Nahibi:And then he, like, got up out of it and felt this like euphoria, which is interesting.
Chris Nahibi:I could just be like, you know, it's a cool place to sit.
Chris Nahibi:But it was, you know.
Saeed Omar:Yes.
Saeed Omar:Who knows, right?
Chris Nahibi:There's just so much about the world we don't understand.
Chris Nahibi:And instead of like focusing on figuring out who we were and where we came from.
Saeed Omar:Yeah.
Chris Nahibi:We soon our time obsessing about the markets and politics and numbers that really don't mean anything unless we make them mean something.
Saeed Omar:Yeah.
Chris Nahibi:Weird year.
Saeed Omar:It was a very weird year.
Chris Nahibi:Yeah.
Chris Nahibi:But we have UFOs now, so that's good.
Saeed Omar:Yeah.
Saeed Omar: e resounding theme for all of: Saeed Omar:Just be tasteful with what you say.
Chris Nahibi:That's your resounding theme.
Chris Nahibi:I've got a better closure of the year.
Chris Nahibi:You ready for it?
Chris Nahibi:You're holding your, your mic stand again.
Saeed Omar:Yeah, I'm ready to stroke.
Chris Nahibi:Yeah, I can tell.
Chris Nahibi:Take your time.
Chris Nahibi:Put those fuzzy knuckles free, brother.
Saeed Omar:Stay fuzzy.
Chris Nahibi:I think this year proved to me more than anything else that the speed of communication and the influence of social media is much more pervasive in the real world, in the economy, than we ever gave it before.
Chris Nahibi:And that Elon Musk single handedly shown an ability to influence an election a great deal.
Chris Nahibi:I'm not saying that they won it because of Elon Musk.
Chris Nahibi:Certainly the assassination attempt and all these other things didn't hurt.
Chris Nahibi:But communication moves at the speed of light.
Chris Nahibi:Traditional media is dying.
Chris Nahibi:And the way we are addicted to our phones means that influence, the quantifiable influence, is really, really, really changing.
Chris Nahibi:And I believe the next leap forward with AI, with the way we rely on social media for news, the way we're addicted to our phones and the way we think of influence, I think most people don't follow other people anymore.
Saeed Omar:Okay.
Chris Nahibi:I think following people is going to go away.
Chris Nahibi:Follower counts is going to go away.
Chris Nahibi:I think what comes next is the algorithm is going to decide what you see and it's going to be like a game of Thrones of content out there.
Chris Nahibi:You like economic content.
Chris Nahibi:You're going to see the higher standard if you engage with a higher standard.
Chris Nahibi:If you don't, you're just going to see less of it.
Chris Nahibi:I don't think following or unfollowing or being linked to people is ever going to matter.
Chris Nahibi:I think AI is going to win this and AI is going to give us what it knows we like.
Chris Nahibi:And I think that's a very dangerous thing that can be manipulated.
Chris Nahibi:And if we don't start to get a better grasp of understanding and filter of parsing through what's real and what's not with AI being.
Chris Nahibi:I played with Sora the other day from ChatGPT.
Chris Nahibi:It's astonishing.
Saeed Omar:Well, I don't even know what it is.
Chris Nahibi:Sora is their video creation model.
Saeed Omar:Oh, I see.
Chris Nahibi:So you type in.
Chris Nahibi:I want to see an image that looks like this.
Chris Nahibi:And it can make a clip.
Chris Nahibi:And there's a couple different versions.
Chris Nahibi: p or: Saeed Omar:Wow.
Chris Nahibi:And you can make.
Chris Nahibi:And I use one on one of the clips I did recently, you know, social media, one that we just did.
Chris Nahibi:Yeah, yeah, that was AI generated.
Chris Nahibi:I was playing with Sora.
Chris Nahibi:I said, put a kid in a room who looks anxious playing on his phone, social media.
Chris Nahibi:And zoom in and out from different angles, and that's what you got.
Saeed Omar:That was really cool.
Chris Nahibi:And I layered in the social media images flying in the room.
Chris Nahibi:But that was.
Chris Nahibi:That was from Sora.
Saeed Omar:Wow.
Chris Nahibi:And it's interesting.
Chris Nahibi:So instead of searching stuff, now I just go to Sora and tell it what I want.
Chris Nahibi:So I don't have to go to a website and say, hey, show me videos like this and then find the video.
Chris Nahibi:I just go to Sora and say, give me a video that gives me this.
Saeed Omar:Right.
Saeed Omar:That portrays this image.
Chris Nahibi:Yeah.
Chris Nahibi:And that's the way of the world.
Chris Nahibi:But he who controls AI will have an ability, in theory, and this is a little tinfoil hat, conspiracy theorists here, will have an ability to control what you, the consumer, think you want.
Chris Nahibi:And that's where this gets dangerous.
Chris Nahibi:It goes back to the same traditional media stance.
Chris Nahibi:Right.
Chris Nahibi:Media was corrupt.
Chris Nahibi:Because of this, AI can be corrupted, too.
Saeed Omar:Oh, easily.
Saeed Omar:Yeah.
Chris Nahibi:And you'll never know.
Saeed Omar:You'll never know.
Saeed Omar:I like it.
Chris Nahibi:Well, fuzzy knuckles, let's call it a wrap for the year.
Saeed Omar:We hope you guys all have a happy, safe new year.
Saeed Omar:Hope you're spending it with your loved ones.
Saeed Omar:We appreciate you tuning in to another episode.
Chris Nahibi:And get your.
Chris Nahibi:Get your mocktail Negronis out there, kids.
Saeed Omar:There you go.
Saeed Omar:Love you, man.
Chris Nahibi:Love you too, bro.
Saeed Omar: To: Chris Nahibi:Another year of doing podcasts for all of you.
Saeed Omar:Good night, everybody.
Chris Nahibi:Bye.
