On today’s episode, Editor in Chief Sarah Wheeler talks with Lead Analyst Logan Mohtashami about Wall Street's increased recession concerns due to the trade war, and how existing home sales react during a recession.
Related to this episode:
6 charts that show storm clouds brewing over the spring homebuying season | HousingWire
https://www.housingwire.com/articles/housing-market-data-spring-homebuying-season-2025/
Enjoy the episode!
The HousingWire Daily podcast brings the full picture of the most compelling stories in the housing market reported across HousingWire. Each morning, listen to editor in chief Sarah Wheeler talk to leading industry voices and get a deeper look behind the scenes of the top mortgage and real estate stories. Hosted and produced by the HousingWire Content Studio.
Related to this episode:
6 charts that show storm clouds brewing over the spring homebuying season | HousingWire
https://www.housingwire.com/articles/housing-market-data-spring-homebuying-season-2025/
Enjoy the episode!
The HousingWire Daily podcast brings the full picture of the most compelling stories in the housing market reported across HousingWire. Each morning, listen to editor in chief Sarah Wheeler talk to leading industry voices and get a deeper look behind the scenes of the top mortgage and real estate stories. Hosted and produced by the HousingWire Content Studio.
Category
🗞
NewsTranscript
00:00Welcome, everyone. My guest today is lead analyst Logan Modashami to talk about the
00:11odds of a near-term recession and what that could do to existing home sales. Logan, welcome
00:16back to the podcast. It is wonderful to be here. As you can see, I'm getting ready for
00:20our Florida trip. We're going to be going to Florida a few times over the next few weeks.
00:27So I'm really festive. I kind of got the Pat Riley thing, like the Miami heat. We're good
00:33to go. Oh, it's a whole theme. I see. Yes, you have sort of a very colorful shirt on.
00:39Very white lotus. Oh, okay. There we go. The white lotus theme. Oh my gosh. Okay. So much
00:47has gone on since last we talked. It was Friday morning. We knew it was going to be wild. Tell
00:53me what happened on Monday in the market. Sarah, today is an important day. Okay. This
00:57is Monday morning. And of course, last week we talked about, you know, market volatility,
01:03you know, President Trump is going to try to fire Powell, you know, what's going on here.
01:09And we've always said this and we've tried to keep constant with our themes from November 7th,
01:152024 to where we are today. We believe in showing a progression of what's happening because things can
01:21change very quickly. But we've, we've said from the beginning, if Trump is going to try to do this,
01:27he needs a lower dollar. He needs lower gas prices, but he needs a lower 10 year yield,
01:33right? He needs lower mortgages. If he's going to try to go at it in a trade war, because 2018,
01:4019 wasn't very successful and he had a better backdrop back then, but now it's getting a little
01:46bit late, uh, uh, in the game without having all three of those things in. So today was the first
01:52day that I actually see kind of wall street, conservative wall street people kind of throw
01:58in the towel. Um, and I, I don't follow a lot of people. I only follow very few. Uh, and some of my
02:07more analytical, smarter friends who tend to be conservative have kind of gone into the recession
02:12camp right now. And I'm going to explain to you, uh, uh, one of the wall street firms, uh, Apollo,
02:17which said there was a 0% chance for a recession going into 2025 late last year. They upped it to
02:2790% today, but why it's not, you can, anybody could say the word recession, but they gave a whole
02:33parameter of variables here. Number one, they said, doges cutting, right? Firing people, something we
02:40brought up, you're firing people and you're withdrawing money from the economy. So just by
02:45that nature, the unemployment rate should increase. If the labor force stays constant or grows, if the
02:52labor force detracts, then the unemployment rate can stay lower. Then they talked about tourism,
02:57like tourism has fallen off a cliff. It looks like COVID. I mean, there's literally, they're all
03:01waterfall dives from many countries. So you've got that negative. Then there's the uncertainty about
03:08tariffs. Like, what are we doing? Tariff on, tariff off, what percentage here? They're all like, we've
03:1127 different plans. They say, that's not, that's not great for business investment. Then they say
03:17confidence, consumer confidence is collapsing. Retail sales, still positive. Home sales are still
03:24positive, but confidence is collapsing. Then they say business confidence, small business index,
03:30which is typically conservative collapsing, right? And the uncertainty of how long this trade war
03:37lasts and what's the next stage is starting to freeze people. And you're going to get hit. Like
03:44example, truckers are going to get hit, like they are already. Farmers are going to get hit. You put
03:48all of them together. This is what they call a voluntary trade reset recession. Neil Dutta, a friend of
03:57mine, very conservative, comes out on TV today, recession. But the kicker was President Donald Trump,
04:06after what he tweeted last night, you know, it's, we got the Sunday night tweet. I got the, he who
04:11controls the gold owns everything. I literally had a video pouring gold on my whole body. But
04:16what he did this morning really showed his hand. And he said, you, the Federal Reserve has to cut rates
04:24because the economy is slowing. Right. And when you go into that, what happened was the stock market was
04:32selling off in the morning, like people anticipated, but the 10 year yield had been falling lower. We got
04:36to that 435 level again, but as soon as Trump talked about, you know, you got to cut rates because
04:41the economy is slowing, you showed your other hand. And now everybody kind of said the market started to
04:47sell off even more aggressively. Bond yields started to tick up higher. The dollar goes to go down. So
04:53Trump has two of his three things. He's got the dollar lower. He's got energy prices lower,
04:57but the 10 year yield has gone up. Sarah, you'll remember this time period better than I do.
05:04But I remember 1981. I even put a picture of myself in 1981 with a love boat hat, sticking my two
05:13thumbs up in the air, smiling and gone. And back in 1981, it was kind of the sell everything, sell all
05:20U.S. assets. You're selling the bond market, you're selling the dollar and you're selling stocks.
05:25Right. It's very similar of that period right now. That is problematic. I think there's limits to what
05:34they could tolerate with a stock market being a bear market or correction, but they can't literally let
05:40the 10 year yield go up on them like this. And we saw that once. And some people were waiting for a
05:46trade deal with Japan, but Japan comes out and goes, we don't know. Every time they switch up the
05:51policy, you know, something new is coming. So this is starting to get into the chaotic
05:55atmosphere. And you can't just tweet something and say, one of the things he said is that the
06:01trade things are going well. So as of right now, it's very chaotic. And some firms are saying,
06:07hey, listen, this continues. We're going to get a recession.
06:10So with that in mind, two things we're going to talk about. How do home sales act during
06:19recession? We had an internal Slack conversation on this, Jordan, because I love this stuff more
06:24than anything. I did a little presentation, a dissertation for those that if you do have
06:28an Instagram account, if you want to see live videos of me talk, I do some of the things there
06:32so you can see the charts. But we're going to talk about how does housing act in recessions,
06:38going back to all the recessions, going back to early 1980s. But first, what does the Fed do here?
06:47Because the Fed always says, hey, the economy is strong. There's uncertainty, but it's strong.
06:52And now you're starting to get more and more people saying, hey, no, this isn't working.
06:59And I've always said, labor over inflation. The way I looked at it back in 2022, what I would have
07:05done. And by the way, no one should ever have this kind of power. No, don't ever give one person
07:10that kind of power. Omnipotent, all powerful beings, Federal Reserve none. What a series of
07:15people. The Fed funds rate, I would have stopped at 4% because the original plan, I actually like
07:23that they want the Fed funds rate to match the growth rate of PCE. Now, if we would have stayed to
07:28that, that's what President Trump was talking about today. He's like, look at the growth rate of
07:32inflation. There's no inflation, right? There is inflation, but there's, you know, it's got two
07:36handles on it. If you didn't raise to five and a half, a lot of things would have been different.
07:42You would have had the disinflation anyway, right? Because the supply chains are working and the Fed
07:47forecasts stronger inflation data and weaker jobs in 2023. The exact opposite happened. The growth rate
07:55of inflation fell faster. Jobs actually did better. So it's not the economy booming or anything. It's
07:59just supply chains working. But now you're in a position to where can the Federal Reserve with an
08:05honest face keep on saying, well, the economy is strong and this and, you know, we don't, or are
08:11you literally going to wait until the labor market breaks? So today I'm saying they probably can't wait
08:20that long. And we have two Fed presidents now, both conservative, both are moving up in the rankings
08:27of the Federal Reserve. Powell's obviously done by 2026. They're saying labor over inflation.
08:34We're going to start to have what we talked about last week, a civil war between Fed presidents,
08:40a war between Powell and Trump. But you can do that if the economy stayed firm and the labor market
08:47didn't break. You could hold the policy as restrictive as possible. But now the question is,
08:54do they wait to see the labor market break? And then what? Then how do you handle that? Or do you
08:58try to get ahead of the curve? I've always said that they are naturally old and slow. But now that
09:05everyone's, they're starting to be unanimous, this is not good for the economy or jobs or anything like
09:10that. That goes into the dual mandate. So this just makes life for the Federal Reserve much harder
09:16because the thing they held their hat on all the time was the labor market. And if everyone sees or
09:22it's connecting the dots like Apollo did, Apollo was like, we're going to do rate hikes this year.
09:28That's how confident they were on the economy. They're doing, we're doing rate hikes.
09:32In 2024, they said that?
09:332025. No, for 2025, they were talking about rate hikes. You know, what if the next move is a rate hike?
09:39So now they flipped. So the question is now everyone's eyes are on the Fed now because now
09:46you're getting more and more people that were bullish on the economy saying, hey, listen,
09:50we have all these variables. They're all coming at once. And then President Trump shows his hand by
09:55saying, hey, listen, the economy is slowing down. We need lower rates. You know, in that context,
09:59and as we talked in the last podcast, we did have a manufacturing recession in 2015, 16. We're able
10:05to handle it. Rates were lower. So I think that's where we go from now on to the end of the year
10:11on this tug of war between the trade war tap dance, the Federal Reserve, Powell, Trump,
10:17Fed presidents talking about preemptive rate cuts as they did. And it just gets more interesting,
10:23Sarah. Every day, it just gets more interesting.
10:26It does. You know, you brought up the tourism industry, and I don't think that anybody had that
10:31on their bingo card for this. Because when you think about immigration, I thought about a lot of
10:38different things on that. But I didn't think about the fact that, you know, the way that they've gone
10:42about this is going to have a chilling effect on tourism. So that's a whole industry that might
10:48be affected and you might lose jobs that maybe wasn't even on anybody's scorecard.
10:53So remember what we were looking for into 2025? What was the wild card? The wild card was the
10:59builders, that if rates go up higher, and you know, new home sales starts to contract,
11:04completed units, there is where the builders start laying off people in every economic cycle that
11:08we've shown residential construction workers lose their jobs. Well, oddly enough, rates did fall,
11:15purchase application data for the builders, 5% year over year growth, 14% month to month growth.
11:22It isn't spectacular. But on that context, they have a monthly purchase application data,
11:28it's positive. Rates fell. It makes it harder to have these really big layoffs if new home sales
11:35are just stable. It has to really break below 2022 levels or eventually the apartment unit
11:40layoffs start to occur. So that's something we keep in mind. Now we have Doge. We have money taken
11:46away. We have now tourism. Now we have trade. Now we have farmers. Now we have truckers. We have,
11:52ooh, that's a safari. It got much bigger, right? And, you know, it's just one of these things with
12:02tourism, you know, you could say it's like 1% of GDP. Some people would say if you take all the
12:08input factors of GDP, it's about 2.8 to 3.4%. But in any case, they chip, right? They chip,
12:16chip, chip, chip, chip, chip. And if consumer spending is coming in less tourism, right? You
12:23put all these things together. I think that was Apollo's case. You have too many variables going
12:27the wrong way. And when Trump said we need lower rates, I think even the White House is kind of
12:32like, all right, it's getting a little bit crazy out there, isn't it? So the stock market's selling
12:38off Monday. Is it so much bond yields though reversing throughout the day when those are the things that
12:44we've seen that the White House doesn't really want to see happen because that was part of their
12:48playbook. So complicated trade wars are not easy, right? Again, we've stressed this, the two-year
12:54political cycle. And now you're going to have to start being mindful of Republican congressmen in the
13:01Senate and the House starting to hear from their constituents that, hey, what's going on here?
13:06I just got laid off, right? My farming things, my, you know, trucking business, all of a sudden
13:11their job is for their constituents. You don't have a lot of extra seats in the House and the
13:18Senate to like really go. So if you lose some of them, even before the midterms, you could get that
13:25kind of, you know, pullback. And another variable to think of, you know, DeSantos and some of the
13:31other presidential candidates that might put up, you know, might put up, they will put up their names
13:38for the 2028 election. They're kind of sitting back because if it is Vance that's going to be
13:46running for president, the trade war is him, right? So you got to remember that the trade policy is,
13:54it was a very Republican Reagan kind of thing. So Ted Cruz, DeSantos, all, you know, you can kind
14:02of see it feels just waiting back, right? It's politics, right? They sharpen their knives when
14:07nobody's watching. So we just have to decide, we have to like, look at things that, and of course
14:11me, I hate politics and political economy. I hate it, but because this policy is so big, it's, it's
14:15filtering itself in a lot of data lines, but more interesting. But now the question about what
14:22about housing? And that's it. That is my question. It's like, okay, let's talk about, because
14:26those lower rates, even if everything else is kind of going crazy, if we get lower rates,
14:31that's better for housing, right? So one of the reasons why I have stressed time and time again,
14:38it's the lowest home sales ever recorded in history. When you take the civilian labor force,
14:43the workforce, our demographics, it's really remarkable where home sales are. However, this
14:47year, this year, with all the drama headlines, purchase applications and datas are up year to date,
14:54and it's up year over year. Even for me, I'm surprised because rates have been elevated to the upside
14:59still. But the one difference about this, and we show this in our Slack, in 2024, the 10-year yield
15:07got to the hoarder line at the end of the year, I think December 28th, and it bounced,
15:12and it bounced, and it went up higher. The mortgage rates went from 6.63 all the way
15:16to 7.5%. During that timeframe, the 18-week period that we track and focus on, 14 negative prints,
15:23two flat prints, two positive prints. Very negative. The volumes weren't crashing anything.
15:28We don't have any volume crashes, but the weeklies were very negative. No year-over-year growth.
15:34This year, see, a lot of people saw the tariff this, tariff that. Forget about tariffs. It's a
15:4010-year yield. The housing market revolves around the 10-year yield. So what happened this year is
15:44that on January 14th, the 10-year yield peaked, mortgage rates peaked, and then it started going
15:49lower. So for the first time in many years, many years, purchase application data is not negative.
15:57It's got a positive week with elevated rates. See, if mortgage rates were at 6%, and then it makes
16:02sense to me. But here at elevated rates, positive year-to-date, positive year, all because the 10-year
16:08yield was falling. And I thought about this. You and I talked about this. Oh, my God. We're almost
16:14having a normal purchase application data curve, right? In the previous decade, it was very simple.
16:20We highlight the second week of January to the first week of May. We're almost at the first week
16:25of May. That's the seasonal demand curve of purchase application data. You always want to track the
16:29year-over-year data on that. And then after May, total volumes always fall. And we do it over and over
16:35again. COVID has messed up a lot of things, but it looks like a normal seasonal demand curve. We have
16:42about two more weeks left. We don't know what the purchase application data is going to look like
16:47now. But still, in April, I wouldn't have been able to say this in the last two years. The last
16:54two years, I've already written. Sales have peaked on the monthly side. That's it. I can't do it because
16:59the forward-looking data is still positive. So we're going to get the existing home sales report this
17:04week. It should have a month-to-month decline because our weekly data is a little bit ahead of the NAR's
17:09existing home sales. And it's just recently gotten better. So it's not going to filter in
17:13this report. But the reason I bring this up is I took every single economic cycle we had starting
17:21from 1981. And then I drew lines. We call it crayon economics because we want to keep it so simple.
17:30Every single recession, because people say nobody's going to buy a house. That's not been the case.
17:34So what about the rates? Yeah, let me show it to you guys. So I took a chart. Oh, I took a chart.
17:42I drew red lines. And I showed every single recession post-1980. What happens is sales tend
17:53to get weaker going into a recession. Why? Why does this happen, Sarah Wheeler? Rates go up. Sales go
17:59down, right? So we take the, we take the, let me, let me go line by line on every single one. The 1980s
18:04recession, double dip recession, selling assets, bond yields went up, stocks sold off, dollar was
18:10getting gas. Nobody could buy a house. Affordability is worse. Oh my God. Mortgage rates fell two and a
18:15half percent. Sales are rising. Fell five percent. The chart actually looks like a vertical increase,
18:24like one of the sharpest increase we've seen in recent history in a time where people said nobody's
18:28ever going to afford a house ever again. Oh, I'm shocked. I'm shocked. I'm shocked. It happened
18:31because nobody, nobody has a job, Sarah. Double dip recession. Confidence was terrible. Credit data was
18:38terrible back then. Vertical. Now rates fell in that recession. Sales went up very low bar. Then the
18:461991 recession. Okay. So 1991 home sales were falling for years going into the recession. We saw that one
18:52last dip in the recession data line. And then shocked Sarah, nobody has a job. Nobody's working
19:00still millions of people bought homes and it increased as the recession happened. Sales started
19:05to increase 2000 tech recession, not much happening. Sales didn't really go anywhere during the, during
19:12the recession. And then as rates fell, it started to pick up. So I don't even have any kind of negative
19:17curve in the existing home sales report because it impacted new home sales data a little bit more,
19:23but not, not much. And then sales starts to increase. There you go. That's the other recession.
19:292008, even credit boom, credit bust, huge collapse in home sales, credit breaking, underwater mortgages,
19:37short sales, foreclosures, all these things, sales bottom. Eventually rates went lower, very slow.
19:44But for those of you who don't remember my work in the last decade, the whole concept was we're going
19:49to have the weakest housing recovery in the history of America. And nothing's going to really change in
19:54the big scales until years 2020 to 2024. But even back then sales started to slow. So those are the
20:00recessions. COVID, we take that out. COVID. Okay. Housing broke out before COVID. The dip that we saw
20:06was behavior, right? That wasn't because people didn't want to buy homes. It was behavior. The fear of,
20:11oh my God, we're all going to die. Oh my God, we're all going to live. Mortgage rates are 3%.
20:15Now, what are we doing here? Here, the lowest home sales ever recorded in history, 2023, 2024,
20:25near 5 million total home sales with elevated rates, elevated prices, elevated taxes, elevated
20:32insurance. And yet home sales aren't crashing anymore. But this year, this year, amongst all
20:40the headlines with elevated rates, it's the first year in many years purchase application data is
20:45positive. So when people say that the tariffs are right, okay, if the tariffs are really freaking
20:51people out, then purchase application data should be negative. And it should be negative even if rates
20:56went low. That's not the case. Now, you don't do long-term damages to the economy without getting
21:03hit in America on the political side. Everyone knows this. There are rules, midterm elections,
21:07everything. The thing with tariffs is that Congress can take it back. And all this game plan, everything
21:13that's going to just does not work well. So this is why a set Trump, everyone wants lower mortgage rates
21:19because if people are buying homes and driving and they see lower gas prices, they're buying homes again.
21:23What is that? They're going to go, remember the Biden era? You couldn't do that back then. That's
21:28how they're marketing this thing because they know going into a trade war, it's going to cause a lot
21:32of drama and those things should happen. It's just that the 10-year yield has not cooperated as much
21:37as they'd like, right? They can take the stock market being a correction, even in a bear market, but
21:42here they need that rates to go lower. This is why Trump is going full force. So imagine, ask yourself
21:50this, everybody listening. You have your family's life right here. There's going to be a poll or a
21:57question. The question is, if mortgage rates were at 5% for the next 12 months, do you believe home
22:05sales will go down or up no matter what happens in the economy? No equivocation here. There is no
22:12delay, pause, or anything. My hand is up. History has shown us it goes up, especially from this record
22:21low level. So I urge people, go look at existing home sales back to 1968. Look at the recessions.
22:28It's a trend. Sales go down. They stall out at very, very low levels. Rates go lower. Households form.
22:36Jobs have been created during that period of time, and then it picks up. Now, there's going to be a one
22:41level bounce. After that, we'll talk about next. But if this occurs, we have to be mindful of history
22:48here. But the whole question is, if you're in housing, it's like, okay, when and how do we get
22:53those lower rates? Where we are right now, how do we get even down to 6%? Well, we've had 6% twice in
23:00the last few years, but all of those times were the labor market. Everyone's afraid of the labor market.
23:06The bond market is afraid of it. This is where the fight is going to be, right? Because I don't believe
23:11the Fed can hide behind this anymore, right? It's one thing if Biden was president and people say
23:18the jobs number is fake and whatever it is, it's not the case anymore. Everyone's kind of all in on
23:24the economy slowing down. And if you have a dual mandate, see, here's where I think the Fed is at
23:31risk. What if the inflation data never took off? What if the weakness in the economy made consumption
23:39go down and it never went as high? And here we are waiting, even though the labor data is breaking
23:45on them for them to be aggressive? Then you could say, wow, they were late on COVID. Now they're late
23:51on this. Goodbye, Jerome Powell. You blew it on both sides. It starts to get more difficult, right? We
23:59always say that when you put this trade war variable in it, oh, both sides can make an error here,
24:06right? And you got both sides. You don't really like each other, okay? So it's more problematic
24:12when there's no drama. But I made the point that the Fed was not very dovish anyway going into this
24:19year. They're like, well, you know, we might be near neutral. This is before tariffs. This is before
24:26we're getting near neutral policy. We'll see if we need to cut him over. So on this,
24:32go get him, Trump. On this very thing, on this, I 100% agree with him. He should have just gone
24:41after it right then, okay? But when you're waiting to-
24:45Okay, but let's back up there because you're also the person who said that the president should not
24:50be interfering in the Fed. So how does Trump go out?
24:52No, you can talk the Fed people down all you want. This happens all the time. Firing the Federal
24:59Reserve, firing him, no. That's a whole bottom market. But if you want to say, hey, guys, listen,
25:05where's your neutral rate? Housing has been in a recession for, you know, tell me what are we
25:12waiting for? So this goes into a policy debate. Now, I could also argue that as soon as Trump won,
25:18everybody said, okay, he's going to do tariffs. Let's see what it is, right? And the tariffs are
25:22going to really mess up some of the economic debt. We're already seeing people like getting ahead of
25:25more purchases because everyone is afraid of what it's going to cost a few months. So all this data
25:30is all messed up. But in this case, they were not dovish beforehand. We had Fed presidents talking
25:38about, are we near neutral? Maybe we don't need to cut rates anymore. So there's a lot of things to
25:45go around. But now they can't hide anymore. Because we have conservative Wall Street people
25:52saying, hey, this is not good. This is a recession. We have Trump saying, hey, the economy is slowing
25:55down. We have a Fed that has a dual mandate. And what do we say? Sarah, that dual mandate is going to
26:01be the good, the bad, and the ugly. Get those six shooters out. Clint Eastwood.
26:09You were reaching for your belt, but I was like, I'm not sure what you're going for here.
26:13No, well, we've got the six shooters out. It's a dual. It is a dual. Who's going to shoot who's
26:19first in this dual mandate? Because the other dual mandate says that the Feds are going to wait,
26:25and then they're going to save. But now it gets interesting because there's no more consensus
26:30anymore about the economy. They go, this keeps on continuing. Now, another hypothetical,
26:36let's say we make a hell of a lot of trade deals in the next two or three weeks.
26:40This all goes away. There's other things you could worry about, but this portion of it
26:47goes away. So the Fed says, we don't know what's happening. We don't know what's going on here. So
26:52you can see everyone has a case here. But it is interesting how today was a day where I think a lot
27:01of people just had the realization, especially when Trump reaffirmed it asking for, you got to get your
27:07rate cuts ahead of time because the economy slowing. This is what Christopher Waller talked
27:14about, about, you know, if the economy slows down, I want to get ahead of it by doing preemptive rate
27:19cuts. And then Bowman, labor over inflation. Oh, I've been a big hawk on inflation, but now I'm going
27:27to focus on the labor market. This is not by accident. These are not, this is all this tactical.
27:34Everybody does their tactical. They're putting their careers and everything on the lines. And
27:38if this breaks, oh, Sarah Wheeler, the last few weeks, it's going to be cupcake. Be like watching
27:46the Care Bears and the Strawberry Shortcake have a little party. It's going to be Godzilla and Kong
27:53in the pits of hell fighting demons and orcs and goblins or Trump and the Fed. If that happens,
27:59it gets harder for the Fed to sit there and go, we're going to wait. And that's, that's the
28:06probability of chaos. All agents of chaos create this. COVID was an agent of chaos. 2022, that
28:13still, 2022 was the craziest year ever. 2022 was agents of chaos. You're just not sure. Here,
28:19nobody's sure, but they're starting to become a consensus now that this is not going as planned.
28:25And, uh, there's a reason why Trump said we need preemptive rate cuts. The economy's slowing.
28:32So we have about what, two weeks before we get that jobs Friday number.
28:36Well, the, the, the jobs Friday, again, people are looking out the jobs reports the past two months.
28:44Fine. Jobless claims fine. Right. So we always say labor over inflation. There are key data lines to
28:50track. They have not broken yet. People are now looking ahead if this keeps on continuing.
28:56So that's the thing about, we're not talking about the current data, retail sales beat estimates. I
29:00know a lot of people said front loading again, but, uh, it's, it's, it's when jobless claims start to
29:07increase, right. It's where it gets very problematic because every single economic cycle, post-World
29:13War II, you start to see this. So, uh, it's today, today was one of those days where you start to get
29:18everyone's, uh, you know, kind of on the same page here. If this keeps on going, you're going to get
29:24this. But if, if it does happen, let's say, let's say the feds cuts one and a, one and a half percent
29:30mortgage rates go sub 6%. You're going to get those people, Sarah. I guarantee you 100%,
29:36no equivocation. They're going to go, who's going to buy the homes. Nobody has a job. Nobody has income.
29:42It's like a homie. We're going to, we're going to do a countdown. That's what I'm going to do.
29:45I'm going to count every single person in America working every jobs report. And I go,
29:50show me the person that says no one's working. Who is he? Where, where did he go to college?
29:55That person needs to get a refund because here's 162 million people working at these. Where's the,
30:01where's the jobs? Oh, you can see, I'm very excited about this. I can see that you are very
30:07excited about that. Well, we will be very excited to see how this shakes out. No one wants a recession.
30:11You and I've talked about this. No one wants people to lose their jobs,
30:14but if we're going to go into a recession, there is a benefit to those in housing.
30:18And we would, you know, we'd love to see that part of it.
30:22Time will tell, but again, we'll, we'll track everything day in and day out. But again,
30:26we, we've always stressed there's a window here for Trump to get deals, right? And he's obviously
30:33talking deals because he's talking to Japan to get the deals. A lot of people thought, you know,
30:35people are now, people are now taking bets about which country, like South Korea, Vietnam,
30:39you know, all this stuff, but, but obviously it's deals now, right? Trying to get deals done.
30:45This is not going to be the universal tariff, no deals. Here we go. We're going to change the
30:49entire car. Now we're talking about time, Sarah. Oh, midterm elections. It's, it's, it's a bane of
30:56every sitting president that gets it, but that midterms are coming up. And this is the,
31:00the unfortunate reality for Trump is that tariffs are something Congress can take back.
31:04You know, it's not like policy or anything, tariffs or something. And he still has to pass,
31:10you know, budget, the tax cuts. He hasn't got tax cuts yet. So I would say this, we, we, we had this
31:17discussion with wall street traders and said, I said, if Trump waited a year, let the fed cut rates,
31:24you would have the inflation rate data be slower. You would add a better footing. Powell is on the
31:29verge of leaving in 2026. If you want to put Warsh in there at that point, give yourself a little bit
31:36of time and leeway, a better footing, get your tax cuts, get whatever you want, then go for it like
31:40you did in 2018. But the problem going in right away and doing tariff on, tariff off and bluffing
31:47and people say, he, he had to do something. He did it. And it was Godzilla and markets are. So
31:55one day at a time, again, we will, we'll track all the key data designs each week,
31:59but a very interesting day, very interesting market day. And think 1981, I was sick, Sarah.
32:07And I was only in like middle school. It's not like I was super old or anything.
32:11No, no, you weren't super older, but bond yields sold off, dollars sold off, stocks sold off. So this,
32:19this reminds me a lot of that and what happened in 82 and those periods of time. So
32:23I encourage everybody to go see the visuals of existing home sales going back. You can see
32:28those charts, you know, you can see it. And there's a progression sales going lower,
32:33stalls out, rates go lower because you're working from a low bar. Sales tend to move up higher off of
32:38that. Logan, thank you so much for being on again. We will talk again soon as always. Thank you.
32:44My pleasure.
32:53Bye.
32:58Bye.
32:59Bye.