Jamie Dimon vs. Jim Cramer, 2.3 Trillion Dollar Home Problem and Extremes are Bad

Redfin Corp. has said that the total value of homes in the U.S. totaled $45.3 trillion at the end of 2022, which is down about $2.3 trillion, or 4.9%, from the June 2022 peak of $47.7 trillion. That marks the biggest decline for any June-to-December period since 2008, during the financial crisis. The housing market has been declining as rising mortgage rates have hurt demand. The hardest hit area was San Francisco, which saw the total value of homes in December fall by $37.3 billion, or 6.7%, from a year ago to $517.5 billion, while Miami saw the value of its homes surge by $77 billion, or 19.7%, in December to $468.5 billion.

In this episode of The Higher Standard, Chris and Saied examine this news and determine the effect this will have on the housing market.

They discuss data from the Mortgage Bankers Association (MBA) showing that the average interest rate on the most popular U.S. home loan rose last week to its highest since November as bond markets took fright that the Federal Reserve might have to continue tightening policy through summer to subdue inflation.

Chris and Saied look at news that the number of large office landlords defaulting on their loans is on the rise, which appears to offer fresh evidence that more developers believe that remote and hybrid work habits have permanently impaired the office market.

They also offer some thoughts on ‍the decision to no longer offer travelers using American Express premium credit cards the ability to to bring two free guests to the American Express lounges. There is now a $50 fee for adults and a $30 fee for children ages 2 to 17.

Join Chris and Saied for this fascinating and informative conversation.

Enjoy!

What You’ll Learn in this Show:

• Why something in the Fed rate outlook is causing problems in the market.
• Why college campuses have incubators for extremism on all sides.
• Why people need to be aware of where the market is moving.
• Why existing home sales have slowed down, no matter what some will say.
• And so much more...

Resources:

"U.S. mortgage interest rates jump to highest level since November - MBA" (article from Reuters)

"US home values declined by $2.3 trillion in 2nd half of 2022, Redfin says" (article from MarketWatch)

"Existing home sales fall for the 12th consecutive month in January" (article from CNBC)

"Office Landlord Defaults Are Escalating as Lenders Brace for More Distress" (article from The Wall Street Journal)

"American Express Airport Lounges Cut Back on Free Plus Ones" (article from The Wall Street Journal)