Latest / Earn Your Leisure / Cliff Notes: THE FED RAISES RATES & MORTGAGE INTEREST RATES SKYROCKET

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Cliff Notes: THE FED RAISES RATES & MORTGAGE INTEREST RATES SKYROCKET · Earn Your Leisure

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  Speaker 2: Let's get into this. Shout out to MG the mortgage God.
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  Speaker 2: He texted me today. We spoke a couple of weeks ago,
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  Speaker 2: and he said, I told you a couple of weeks ago,
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  Speaker 2: seven percent interest rates coming soon. So they just released
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  Speaker 2: numbers thirty thirty year fixed mortgage six point eight seven
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  Speaker 2: percent for the thirty year fixed. Fifteen year fix is
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  Speaker 2: six point fifteen. So yeah. Matt called me a couple
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  Speaker 2: of weeks ago and I asked him how high he
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  Speaker 2: thought interest rates could get for mortgages, and he told
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  Speaker 2: me seven percent. And it's creeping. It's creeping to that
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  Speaker 2: seven percent level.
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  Speaker 3: Sounds like, oh seven all over again.
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  Speaker 4: Yeah, I mean historically, think about it's not a relatively
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  Speaker 4: low exact, That's what I was gonna say. I was like,
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  Speaker 4: I had to humble myself, and like, I'm thinking about
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  Speaker 4: obviously my parents were buying, like buying a home in
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  Speaker 4: the eighties, Like we talked about if you look at
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  Speaker 4: the interest rates in like from nineteen eighty to nineteen nine, this.
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  Speaker 3: Oh yeah, I was treacherous. Yeah yeah, this in years
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  Speaker 3: when it was like eighteen percent.
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  Speaker 5: Fourteen percent, Like, how's this even?
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  Speaker 6: How?
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  Speaker 5: How does somebody do that?
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  Speaker 4: And it is because I was talking to Matt when
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  Speaker 4: I was trying to lock it an interest rate, and
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  Speaker 4: I was like, look, man, it's that like four he said,
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  Speaker 4: locking it now is not.
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  Speaker 5: It's only going up. And so watching it go up
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  Speaker 5: to seven percent, it's tough, man, it's tough, but perspective
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  Speaker 5: is team. It could be worse. It could be worse.
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  Speaker 3: It could be worse, man, y'allhoo.
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  Speaker 6: Finance reported sales of luxury homes dropped by twenty percent
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  Speaker 6: as a result from August. I know everyone's kept saying
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  Speaker 6: the market is not going to fall. No, if interest
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  Speaker 6: rates go up. This is common sense. If things cost more,
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  Speaker 6: people are going to buy less of it, right, especially
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  Speaker 6: if the price.
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  Speaker 3: Adjust in four months five months.
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  Speaker 2: Well, so this goes to the economic talk. So a
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  Speaker 2: couple of days ago we didn't get a chance to
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  Speaker 2: talk about it because it wasn't Monday going on. When
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  Speaker 2: the Fed raised interest rates. So yeah, I mean the
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  Speaker 2: whole point of raising interest is to taper inflation. So
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  Speaker 2: you know, it's or it's done to make money more expensive,
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  Speaker 2: so that pass gets passed down to the bank. So
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  Speaker 2: when the Federal Reserve raises interest rates, then the banks,
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  Speaker 2: the retail banks actually borrow money. So that means that
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  Speaker 2: it's more expensive for the retail banks to all money.
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  Speaker 2: So now the interest products that retail banks offer, like mortgages,
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  Speaker 2: like credit cards, like different things of that nature, all
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  Speaker 2: the loans are higher, So yeah, it tapers inflation because
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  Speaker 2: people aren't buying at a crazy pace like they were before.
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  Speaker 2: But it's a delicate line that you have to walk
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  Speaker 2: because it's like if you if you raise interest rates
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  Speaker 2: too much, then you could break the economy. So you
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  Speaker 2: raise interest rates to stop people from spending to lower inflation,
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  Speaker 2: but you don't want to raise it too high to
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  Speaker 2: you know, shut off the faucet.
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  Speaker 6: Yeah, And as a result in the lower inflation environment,
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  Speaker 6: credit card balances have won to one of the highest
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  Speaker 6: levels of all time at forty six billion dollars. Now,
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  Speaker 6: I want you guys to add that with the student
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  Speaker 6: loan bubble and if those two pop, how much that
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  Speaker 6: is that out in the universe.
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  Speaker 5: Yeah, I mean in addition to that.
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  Speaker 4: Right, So to the back to the home thing, obviously,
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  Speaker 4: when interest rates go up, it makes people tougher to
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  Speaker 4: buy homes, but you're going to and if you look
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  Speaker 4: at the percentages, look at the percentage of people that
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  Speaker 4: are refinancing their homes, right, like, why it wouldn't even
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  Speaker 4: make sense now, right, then you're not going to try
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  Speaker 4: to lock it in a higher rate.
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  Speaker 5: So that obviously that goes down as well.
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  Speaker 2: But there's also there's also it's never the end of
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  Speaker 2: the world, because if you buy, if you buy it,
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  Speaker 2: even if you buy now it's a seven percent interest rate. Eventually,
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  Speaker 2: rates will go down eventually and you can always be financed.
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  Speaker 5: That's when it would be a time to refund.
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  Speaker 4: So what I'm saying in this environment doesn't make as
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  Speaker 4: much sense as it did nine months ago.
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  Speaker 5: Months ago.
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  Speaker 6: Homework question for everyone, how often do interest rates go
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  Speaker 6: down when there's not quantitative bees on?
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  Speaker 2: Well, there's going to be quantitative easing though at some
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  Speaker 2: point there's going to be quantitative There's going to be
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  Speaker 2: another round of quantitative easing. It'll happen.
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  Speaker 3: Everybody next crashed, maybe twenty eight or twenty.
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  Speaker 2: Nine, it'll happen.
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  Speaker 3: It will happen. Its gonna be a few years.
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  Speaker 2: Yeah, give it. Give us some time to breathe.
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  Speaker 5: Okay.
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  Speaker 6: If they're telling you they're tightening it, which that's code
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  Speaker 6: for destroying the new wealth, new money.
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  Speaker 3: That got created.
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  Speaker 6: Why would they put interest rates back at zero for
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  Speaker 6: new wealth to come out?
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  Speaker 3: They're not. It's part of the cycle. That's what.
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  Speaker 6: Like when I told everyone go get that Ray Dollio book,
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  Speaker 6: like that was a super cheat.
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  Speaker 3: Code to tell you, Like what was happening.
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  Speaker 6: The Fed have and I need everyone realizes every entitea
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  Speaker 6: and every person is responsible for their team winning. Only
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  Speaker 6: even a federal reserve, they have their own best interest
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  Speaker 6: at heart when they're doing these things.
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  Speaker 3: As they should.
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  Speaker 2: Credit for free Gunner free y mself.
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  Speaker 5: Yeah, it ain't about the marand yes.
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  Speaker 2: Trap Wall Street trapper stated if Apple falls saw one
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  Speaker 2: hundred and thirty dollars, the market will fall apart. Do
• 10:39
  Speaker 2: you believe this to be true? And if not, what
• 10:43
  Speaker 2: price would be a sign?
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  Speaker 3: Shout out to the.
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  Speaker 5: Trapper and let me give contacts to the people out
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  Speaker 5: there for you. I know you're gonna go crazy. All right,
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  Speaker 5: So market tap wise, biggest company right has the biggest.
• 10:54
  Speaker 4: Market tap But I waited, So the percent of how
• 10:57
  Speaker 4: much of the influence and dominance that Apple has on
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  Speaker 4: the S and P is seven percent, so it's five
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  Speaker 4: hundred company seven percent is just weighted average.
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  Speaker 5: Uh and on the mastep's fourteen percent. So just keep
• 11:10
  Speaker 5: that in context. I'm throwing into the gam.
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  Speaker 3: Yeah, trying to tryus, my guy. I appreciate it.
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  Speaker 3: So kudos to him.
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  Speaker 6: One thirty is going to be a key level, like
• 11:34
  Speaker 6: I mapped out one for me and trap price is
• 11:36
  Speaker 6: always be eight nine ten dollars apart maximum.
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  Speaker 3: But yeah, I figures thirty. They can be tough. They
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  Speaker 3: can be really tough.
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  Speaker 8: Man.
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  Speaker 6: I will starting to worry about global depression at that point, Seriously,
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  Speaker 6: I would, because if they're in.
• 11:55
  Speaker 2: Trouble, I Fi might be a little chot. Like you're
• 12:02
  Speaker 2: a little chopped and screwed right now.
• 12:04
  Speaker 5: They're trying to put you in the matricen.
• 12:05
  Speaker 2: Yeah, you're chopping screwed.
• 12:10
  Speaker 5: Yeah. So it's at one fifty right now.
• 12:12
  Speaker 2: So as we wait for Ian to get his Wi
• 12:14
  Speaker 2: Fi signal together, somebody had asked about eyebonds, uh and
• 12:19
  Speaker 2: the chat. I actually wanted to talk about that because
• 12:21
  Speaker 2: we did speak about that before. But it is a
• 12:23
  Speaker 2: great way to hedge against inflation. The only thing with
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  Speaker 2: eyebons I think going most that you could put it
• 12:27
  Speaker 2: in ten thousand dollars. Well, yeah, but I do think
• 12:29
  Speaker 2: you can put it in twenty thousand if you're married,
• 12:32
  Speaker 2: gotcha right now? So eyebonds are government bonds that track
• 12:37
  Speaker 2: that go based off the inflation rate. So yeah, it's
• 12:41
  Speaker 2: a good time to buy eyebonds right now because obviously
• 12:43
  Speaker 2: inflation is very high, so you'll be earning. I think
• 12:47
  Speaker 2: what's the percentage right now? I think it's like, I
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  Speaker 2: don't know, it might be like six percent. It was
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  Speaker 2: seven percent a couple of months ago. So that's been
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  Speaker 2: locks it in for six months at a time, I believe.
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  Speaker 2: But yeah, I think you're only put in Well I
• 13:00
  Speaker 2: shouldn't say only, because ten thousand dollars still you know
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  Speaker 2: a good amount of money.
• 13:04
  Speaker 5: Well you were there on ten thousand, ten thousand and
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  Speaker 5: twenty thousand if if.
• 13:08
  Speaker 2: You're married, yeah, but if you yeah, it is a
• 13:11
  Speaker 2: good way, uh to beat inflation, or at least keep
• 13:14
  Speaker 2: up with inflation and it is, it's definitely gonna be
• 13:16
  Speaker 2: paying much higher than any bank or savings account, so
• 13:21
  Speaker 2: definitely something to consider the interested in that.
• 13:24
  Speaker 9: So it says here that the limit for purchasing advos
• 13:27
  Speaker 9: in person, So a married couple can each put up
• 13:30
  Speaker 9: to ten thousand any investment annually, or up to fifteen
• 13:34
  Speaker 9: thousand if they both also elect to get text refunds
• 13:38
  Speaker 9: in payer.
• 13:39
  Speaker 2: So I believe it says nine pointy six percent right
• 13:41
  Speaker 2: now in chat. So but yeah, nine pointy six percent.
• 13:44
  Speaker 2: That can't really beat that.
• 13:45
  Speaker 10: Yeah, my graduates from my school being forced back drop
• 13:52
  Speaker 10: bag drop might drop bag drop drop.
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