Episode 82

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Published on:

21st Oct 2022

A 100% Probability of Recession, Zillow Fumbles the Bag and Q&A

This week several reports are being delivered, including the New York Fed's Empire State Manufacturing Survey, the National Association of Homebuilder's Housing Market Index, the Fed's industrial production data for September and the latest Beige Book on current economic conditions among its 12 districts, as well as the Census Bureau's new residential construction data for September. The predictions for these reports range from 'no change' to 'really bad.'

In today's episode of The Higher Standard, Chris and Saied discuss the one report that has already been released, the Federal Reserve Bank of New York's Empire State Manufacturing Survey, and the 'modest decline' being seen in manufacturing in the state.


They discuss a recent presentation by National Association of Realtors chief economist Lawrence Yun, who predicted that interest rates could be on their way to 8.5% if they pass a threshold of 7%, basing his forecast on key levels of resistance borrowing costs will face after a key inflation indicator hit a 40-year high.


Chris and Saied look at Bloomberg's prediction that a US recession is effectively certain in the next 12 months, representing a blow to President Joe Biden’s economic messaging ahead of the November midterms.


They discuss a new House Prices to National Average Wage Index created by CalculatedRisk to address the difficulties of comparing the ratio of house prices to incomes, when most income data is released with a significant lag.


Chris and Saied also explore Zillow's bold (and deeply flawed) prediction that the so-called pandemic housing boom would see U.S. home prices soar another 17.8% between February 2022 and February 2023.


Join Chris and Saied for this fascinating conversation.


Enjoy!



What You’ll Learn in this Show:

  • Why NAR's chief economist Lawrence Yun's prediction that interest rates could be on their way to 8.5% if they pass a threshold of 7% is more a statement of the obvious than a real look at the future.
  • Bloomberg's prediction that a US recession is basically a done deal within the next 12 months, which is not what President Biden wants to hear this close to the midterms.
  • The insights gained from CalculatdRisk's new House Prices to National Average Wage Index.
  • Zillow's discombobulated reporting concerning house prices, and why there is likely a specific reason behind it.
  • And so much more...


Resources:

"Forecast for US Recession Within Year Hits 100% in Blow to Biden" (article from Bloomberg)

"Mortgage rates could continue rise to 8.5%: NAR" (article from TheRealDeal)

"Stocks Poised to Open Higher on Monday" (article from Barron's)

"House Prices to National Average Wage Index" (article from CalculatedRisk)

"Empire State Manufacturing Survey" (article from the New York Federal Reserve)

"Where home prices in your local housing market are headed in 2023, according to Zillow’s revised forecast" (article from Fortune)

"Latest US inflation data raises questions about Fed’s interest rate hikes" (article from The Guardian)

"The newest Nobel-winning economist lays out 2 reasons the US is 'really exposed' to a financial crisis" (article from Insider)

"Cathie Wood's Ark Sends Open Letter to the Fed" (The Street via Instagram)

"Consumer spending was flat in September and below expectations as inflation takes toll" (article from CNBC)

"It’s bad enough mortgage rates are over 7% – now it’s harder to qualify for a home loan" (article from CNBC)




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About the Podcast

The Higher Standard
This isn’t a different standard, it’s the higher standard.
Welcome to the Higher Standard Podcast, where we give you ultra-premium, unfiltered truth when it comes to building your wealth and curating the lifestyle of your dreams. Your hosts; Chris Naghibi and Saied Omar here to help you distill the immense amount of information and disinformation out there on the interwebs and give you the opportunity to choose a higher standard for yourself. Sit back, relax your mind and get ready for a different kind of podcast where we elevate your baseline with crispy high-resolution audio. This isn't a different standard. It's the higher standard.

About your host

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Christopher Naghibi

Christopher M. Naghibi is the host and founder of The Higher Standard podcast — a rapidly growing media platform delivering unfiltered financial literacy, real-world entrepreneurship lessons and economic commentary for the modern era.

After nearly two decades in banking, including his most recent role as Executive Vice President and Chief Operating Officer of First Foundation Bank (NYSE: FFWM), Christopher stepped away from corporate life to build a brand rooted in truth, transparency, and modern money insights. While at First Foundation, he had executive oversight of credit, product development, depository services, retail banking, loan servicing, and commercial operations. His leadership helped scale the bank’s presence in multiple national markets from $0 to over $13 billion.

Christopher is a licensed attorney, real estate broker, and general building contractor (Class B), and he brings a rare blend of legal, operational and real estate expertise to everything he does. His early career spanned diverse lending platforms, including multifamily, commercial, private banking, and middle market lending — holding key roles at Impac Commercial Capital Corporation, U.S. Financial Services & Residential Realty, and First Fidelity Funding.

In addition to his media work, Christopher is the CEO of Black Crown Inc. and Black Crown Law APC, which oversee his private holdings and legal affairs.

He holds a Juris Doctorate from Trinity Law School, an MBA from American Heritage University, and two bachelor degrees. He is also a graduate of the Yale School of Management’s Global Executive Leadership Program.

A published author and sought-after speaker (unless it’s his son’s birthday), Christopher continues to advocate for financial empowerment. He’s worked pro bono with families in need, helped craft affordable housing programs through Habitat for Humanity, and was a founding board member of She Built This City — helping spark interest in construction and trades for women of all ages.