Latest / Brian Thomas / Empower U - Breitbart News - John Carney

Transcript

Empower U - Breitbart News - John Carney · Brian Thomas

• 0:00
  Speaker 1: Fifty five krc D talkstation, o F the Thiky five
• 0:07
  Speaker 1: kr CV talk station. Brian Thomas always looking forward to
• 0:10
  Speaker 1: this time of the week and this moment in time
• 0:12
  Speaker 1: on the morning show because it's time for the inside
• 0:15
  Speaker 1: scoop with Bright Barton News. And as I always start
• 0:17
  Speaker 1: the segment with do Yourself a Favor Bookmarket B R
• 0:21
  Speaker 1: E I T B A R T dot com, you'd
• 0:23
  Speaker 1: be glad you get did beautiful reporting, wonderful reporting, a
• 0:26
  Speaker 1: lot of stuff you're not going to read elsewhere until
• 0:28
  Speaker 1: like a year later when the stuff they report on
• 0:30
  Speaker 1: bright Bird turns out to be absolutely true and where
• 0:33
  Speaker 1: you can read the work of John Carney, the finance
• 0:35
  Speaker 1: and economics editor at Bright Barton News. He has been
• 0:38
  Speaker 1: around the finance business for like ever his old career.
• 0:41
  Speaker 1: He started out of a blog for About Wall Street,
• 0:44
  Speaker 1: heading up the deal Breaker blog back in the mid
• 0:46
  Speaker 1: two thousands, went over the Business Insider CNBC Wall Street Journal,
• 0:52
  Speaker 1: where he was he was responsible for the Herd on
• 0:55
  Speaker 1: the Street column. His works appeared to New York Times,
• 0:57
  Speaker 1: New York Magazine, Fortune, New York Post, New York Sun.
• 1:00
  Speaker 1: I could go on, but we wouldn't be able to
• 1:01
  Speaker 1: talk about the Empower Youth Seminar that John Carney is
• 1:04
  Speaker 1: doing tonight on question Mark. Will interest Rates be coming down?
• 1:09
  Speaker 1: Welcome back, John Carney. It's a pleasure having you on
• 1:11
  Speaker 1: the program Sir.
• 1:13
  Speaker 2: Thanks for having me. You just sent me on a
• 1:15
  Speaker 2: nostalgia trip all the stuff I've done over the years.
• 1:18
  Speaker 2: That was great.
• 1:18
  Speaker 1: Hard to believe how time has flown, isn't it? John?
• 1:22
  Speaker 2: It really is incredible. You know, when I started this,
• 1:25
  Speaker 2: we were just going into the two thousand and eighth
• 1:29
  Speaker 2: financial crisis, and you know, here we are just and
• 1:33
  Speaker 2: it seems like we never run out of crises. We
• 1:36
  Speaker 2: kept in business.
• 1:37
  Speaker 1: Well we're on that note, John Kearney. Isn't that sort
• 1:40
  Speaker 1: of kind of intentional? I mean, I've been doing radio.
• 1:43
  Speaker 1: Next year is my twentieth year on radio. But I've
• 1:45
  Speaker 1: been following politics since I was like sixteen years old.
• 1:49
  Speaker 1: Reagan's second election was when I really got engaged in politics,
• 1:53
  Speaker 1: and I've never turned back. It was a topic of
• 1:55
  Speaker 1: conversation and at the dinner table. I've really been engaged
• 1:58
  Speaker 1: for my entire life. So it's always in crisis. I mean,
• 2:02
  Speaker 1: part of I think part of the reality, well, this
• 2:04
  Speaker 1: is the idea, is we always kept in a mentality
• 2:06
  Speaker 1: of crisis mode. You know, the world's going to end,
• 2:08
  Speaker 1: We're all going to die, the market's going to crash,
• 2:10
  Speaker 1: the market's going to go up, and you know, we
• 2:12
  Speaker 1: don't follow up to find out, well, was that prediction true?
• 2:15
  Speaker 1: From last year? Is just once they announced these terrible
• 2:18
  Speaker 1: headlines that we move on and go about with our lives.
• 2:20
  Speaker 1: Should we ever feel like we're in crisis?
• 2:24
  Speaker 2: Yeah, no, that's a great point. Look, one of the
• 2:26
  Speaker 2: things that's definitely true is that the media has predicted
• 2:31
  Speaker 2: just about eight out of the last two crisises, meaning
• 2:37
  Speaker 2: there is constantly a crisis, you know, on the horizon
• 2:42
  Speaker 2: or actually happening. I remember the first Trump administration. We
• 2:45
  Speaker 2: were told constantly that we were going to have inflation
• 2:49
  Speaker 2: because of the terifts he put on China, and I
• 2:52
  Speaker 2: covered that every month in and out all three of
• 2:55
  Speaker 2: the major inflation reports that the government produces, and there
• 2:59
  Speaker 2: was no inflation. And it really wasn't until the pandemic
• 3:03
  Speaker 2: struck that finally started, when people were distracted by a
• 3:07
  Speaker 2: real crisis, that the media started to admit, oh, okay,
• 3:11
  Speaker 2: you know, we were wrong. There was no inflation because
• 3:13
  Speaker 2: of the tariffs.
• 3:14
  Speaker 1: But there was inflation because of the Inflation Reduction Act
• 3:17
  Speaker 1: and the COVID nineteen response money and the trillions of
• 3:20
  Speaker 1: dollars that were thrown into the economy from printed dollars
• 3:23
  Speaker 1: that watered down the value of our currency.
• 3:26
  Speaker 2: That's right. And they said that inflation wouldn't happen, So
• 3:30
  Speaker 2: they predicted the inflation that didn't happen would happen, and
• 3:33
  Speaker 2: the prediction, and they predicted that the inflation that actually
• 3:37
  Speaker 2: did happen was the worst in forty years. You know,
• 3:41
  Speaker 2: wasn't really happening. And by the way, we'd go away
• 3:43
  Speaker 2: almost immediately. Here we are five years later and we're
• 3:47
  Speaker 2: still dealing with it.
• 3:48
  Speaker 1: Well, the pesky reality of inflation is while the inflation
• 3:51
  Speaker 1: rate can go up or down, as the case may be,
• 3:54
  Speaker 1: I mean, I'm old enough to remember the seventies when
• 3:56
  Speaker 1: we had stagflation, but the prices never really go down.
• 4:02
  Speaker 1: I mean, you see a two percent increase in inflation,
• 4:04
  Speaker 1: and you've been struggling with seven or eight percent inflation.
• 4:08
  Speaker 1: It's like, I'm never going to see say, two dollars
• 4:10
  Speaker 1: ninety nine cent per pound beef again. I'm never going
• 4:13
  Speaker 1: to see a bag of chips that actually has sixteen
• 4:15
  Speaker 1: ounces in it for three ninety nine as opposed to
• 4:17
  Speaker 1: the twelve ounces you get for three ninety nine. It
• 4:19
  Speaker 1: just doesn't come down, that's.
• 4:22
  Speaker 2: Right, The prices don't come down. The most you can
• 4:24
  Speaker 2: hope for is that you have low inflation for a
• 4:29
  Speaker 2: few years, which may sort of bring you back on track.
• 4:33
  Speaker 2: But the truth is that once you have a period
• 4:35
  Speaker 2: of high inflation, as you said, you jump up nine percent,
• 4:39
  Speaker 2: then even if you get normal levels of inflation around
• 4:43
  Speaker 2: two percent after that, you're permanently at a higher price
• 4:47
  Speaker 2: level than you should be. You can hope that you
• 4:50
  Speaker 2: can grow the economy in a way that lets wages
• 4:53
  Speaker 2: catch up with that, but that takes a very long time. Basically,
• 4:57
  Speaker 2: and this is a I hate to have to deliver
• 5:00
  Speaker 2: this bad news to people, but we are permanently, because
• 5:03
  Speaker 2: of the irresponsibility of the Biden administration and Howells fed
• 5:08
  Speaker 2: during those years, we are permanently stuck at a high
• 5:12
  Speaker 2: price level that is not going to feel right at
• 5:17
  Speaker 2: least for another ten years. You're going to feel You're
• 5:20
  Speaker 2: still going to feel sticker shocked when you walk into
• 5:23
  Speaker 2: a store, or order a meal at a restaurant, or
• 5:25
  Speaker 2: try to buy tickets to something. Prices are going to
• 5:28
  Speaker 2: feel too high for quite a while.
• 5:30
  Speaker 1: All right, Now, if John Carney was chairman of the FED,
• 5:33
  Speaker 1: and you could turn back the tables of time to say,
• 5:35
  Speaker 1: right when Biden got elected, I mean we had three
• 5:38
  Speaker 1: percent mortgage rates at the time, roughly right, I mean
• 5:42
  Speaker 1: that was extraordinarily low. And I have to say out loud,
• 5:46
  Speaker 1: my listeners have been listening to me for a long time. No,
• 5:47
  Speaker 1: but when my wife and I first bought our house,
• 5:50
  Speaker 1: this was nineteen ninety one. We were living in Oak Park, Illinois.
• 5:53
  Speaker 1: That's where we bought the house. Anyway, I had to
• 5:55
  Speaker 1: pay three points to buy down to an eight and
• 5:59
  Speaker 1: one eighth percent interest rate on a on a seven
• 6:02
  Speaker 1: to twenty three balloon. That's I mean, I'm, you know,
• 6:04
  Speaker 1: crime a river at six percent. I understand it's double
• 6:07
  Speaker 1: what it was a few years ago, but I mean
• 6:09
  Speaker 1: six percent still seems within the realm of reality. That's
• 6:13
  Speaker 1: the big thorn in a lot of people's side that
• 6:15
  Speaker 1: they got so used to these really low interest rates.
• 6:18
  Speaker 1: The economy was kind of booming, real estate market was booming.
• 6:20
  Speaker 1: Would you have raised the interest rates back then? Is
• 6:23
  Speaker 1: that a failure of the Fed? Back then.
• 6:26
  Speaker 2: Yes, the first thing I think they should have done
• 6:29
  Speaker 2: is made it clear that if the Biden administration went
• 6:32
  Speaker 2: ahead with its plans to spend trillions, that this would
• 6:37
  Speaker 2: be inflationary and that the FED would try to offset
• 6:39
  Speaker 2: this by raising rates. Look, the FED can't control, you know,
• 6:43
  Speaker 2: Joe Biden's spending programs, but they can do the opposite
• 6:47
  Speaker 2: what they did instead. What they did is they sent
• 6:49
  Speaker 2: the all clear message to Joe Biden to go ahead,
• 6:53
  Speaker 2: spend your trillions, and we will not interfere. We won't
• 6:57
  Speaker 2: raise rates, we will not make it so that we
• 7:01
  Speaker 2: will not try to offset this at all. And that's
• 7:04
  Speaker 2: what set off the wild inflation. I think if the
• 7:07
  Speaker 2: FED had been less complicit in the Biden administration's reckless spending,
• 7:13
  Speaker 2: if they had just even signaled that they were going
• 7:15
  Speaker 2: to offset it, it probably would have made Biden back
• 7:17
  Speaker 2: off a little bit, and then that we would have
• 7:20
  Speaker 2: had far less inflation. Instead, they worked hand in hand.
• 7:23
  Speaker 2: That was a disaster and we got this crazy inflation.
• 7:27
  Speaker 2: So they should have told Biden not to do it,
• 7:29
  Speaker 2: and if he went ahead and did it, then yes,
• 7:30
  Speaker 2: they should have raised rates much earlier, and they should
• 7:33
  Speaker 2: have never said that the inflation was transitory. That was
• 7:37
  Speaker 2: that in itself signaled to the market, to businesses, to
• 7:42
  Speaker 2: consumers that the Fed wasn't on top of things, that
• 7:45
  Speaker 2: they were going to let inflation get out of control,
• 7:48
  Speaker 2: and they did.
• 7:49
  Speaker 1: Well, this is you know, directly tied to the bond market.
• 7:51
  Speaker 2: Correct, that's absolutely right. Look, part of the thing is
• 7:56
  Speaker 2: that when the government is deficit spending like crazy and
• 8:00
  Speaker 2: the FED starts to raise interest rates, it actually then
• 8:04
  Speaker 2: makes the Feds the government's borrowing more expensive, right, and
• 8:09
  Speaker 2: they didn't want to do that. It raises the deficit
• 8:12
  Speaker 2: even more. And so they were trying to help Biden
• 8:14
  Speaker 2: by letting him do all this deficit spending while being
• 8:18
  Speaker 2: able to borrow cheap. That was a disaster. They should
• 8:22
  Speaker 2: not have been complicit with. They really needed to be.
• 8:26
  Speaker 2: You know, people talk about FED independence all the time.
• 8:29
  Speaker 2: The FED lost its independence during the early Biden administration.
• 8:34
  Speaker 2: They instead became an agent of the Biden administration. And
• 8:39
  Speaker 2: that was a that had disastrous results, which is exactly
• 8:42
  Speaker 2: what we would think would happen when they become the
• 8:46
  Speaker 2: agent of a you know, a pre spending political regime.
• 8:50
  Speaker 1: Well, in this this spending free for all and this
• 8:54
  Speaker 1: faux low interest rate was all supported by and covered
• 8:57
  Speaker 1: up and masked by the whole Oh my god, COVID nineteen,
• 9:00
  Speaker 1: We're all going to die, right.
• 9:03
  Speaker 2: That's right. Look, they kept it it so it made
• 9:07
  Speaker 2: a lot of sense, especially early on in the pandemic
• 9:11
  Speaker 2: when they were ordering businesses to close and they basically
• 9:16
  Speaker 2: we're freezing the economy to say, okay, well we're going
• 9:19
  Speaker 2: to fight some of the downturn with very low interest rates.
• 9:24
  Speaker 2: But as soon as we started to reopen things, which
• 9:27
  Speaker 2: means just a few months into this thing, right, they
• 9:31
  Speaker 2: should have said, okay, we can back off of the
• 9:34
  Speaker 2: ultra low interest rates. We don't need to send out
• 9:36
  Speaker 2: more stimulus checks. People were flooding into restaurants in places
• 9:41
  Speaker 2: they could with the relief of thank god, I can
• 9:44
  Speaker 2: go out again. And yet we were still sending stimulus
• 9:49
  Speaker 2: checks to people and the Fed was still holding interest
• 9:52
  Speaker 2: rates at near zero. That was a bad.
• 9:54
  Speaker 1: Combination, bad combination, and like all government programs, ready fire
• 9:58
  Speaker 1: aim replete with fraud, waste, and abuse because no one
• 10:01
  Speaker 1: cared where the money was going, and it went out
• 10:03
  Speaker 1: to a bunch of nefarious actors. Sorry for interjecting that,
• 10:05
  Speaker 1: John Carney, but this kind of thing has been driving
• 10:08
  Speaker 1: me more crazy of late than I think it ever
• 10:09
  Speaker 1: has in my life, as all these programs are revealed
• 10:12
  Speaker 1: for the fraud riddled programs that they are now. Tonight's
• 10:16
  Speaker 1: conversation it's empower you America dot org. Empower You America
• 10:20
  Speaker 1: dot org gets log in only begins at seven pm.
• 10:23
  Speaker 1: Please register in advance for the seminar. And that's where
• 10:27
  Speaker 1: John Carney's going to be speaking about and maybe answering
• 10:30
  Speaker 1: the question will interest rates be coming down? Thinking of
• 10:34
  Speaker 1: those that have been priced out of the homeowner market,
• 10:36
  Speaker 1: I don't think the housing availability is ever going to increase,
• 10:38
  Speaker 1: at least not in the near term. John, So what
• 10:40
  Speaker 1: impact or what effect? First off, do you think the
• 10:43
  Speaker 1: rates will be coming down? What are the indicators that
• 10:45
  Speaker 1: would suggest the FED might lower them? Or might the
• 10:48
  Speaker 1: Fed just leave things status quo? Which is kind of
• 10:51
  Speaker 1: the position I think I'm leaning toward, at least if
• 10:54
  Speaker 1: I had to read tea leaves. But no financial expert
• 10:56
  Speaker 1: of my.
• 10:58
  Speaker 2: So I think the FED very likely maybe cutting at
• 11:02
  Speaker 2: the meeting in December, but then they are not going
• 11:05
  Speaker 2: to cut for probably the rest of Powell's tenure as
• 11:10
  Speaker 2: FED chairman. That means he leaves in May, so we
• 11:16
  Speaker 2: may get one more cut. Then the Fed will sit
• 11:18
  Speaker 2: tight and see how that goes through the economy. I
• 11:21
  Speaker 2: don't think that will do very much for the interest
• 11:25
  Speaker 2: rates that matter. Remember, the Fed target's a very short
• 11:28
  Speaker 2: term interest rate. The rates that matter are built off
• 11:31
  Speaker 2: of that, but they're really built on what investors think
• 11:38
  Speaker 2: the path of interest rates will be. So if the
• 11:40
  Speaker 2: Fed signals it's going to sit tight for longer, that
• 11:43
  Speaker 2: will keep interest rates higher. I'm not sure, and I'll
• 11:46
  Speaker 2: talk about this more tonight, but I'm not sure actually
• 11:50
  Speaker 2: cutting interest rates will do as much as people hope
• 11:54
  Speaker 2: for home affordability. That is a very tricky thing because look,
• 11:59
  Speaker 2: when you cut interest traits, one of the things that
• 12:01
  Speaker 2: happens is because people can borrow cheaper, they're willing to
• 12:05
  Speaker 2: pay more for homes, and it tends to push up
• 12:07
  Speaker 2: home prices. Right, So it's not the panacea that people think.
• 12:11
  Speaker 1: Well, John, the only thing that's going to solve that
• 12:12
  Speaker 1: problem is more supply. I mean, we need more supplin
• 12:16
  Speaker 1: we need. It's more supply of what I would call
• 12:18
  Speaker 1: truly affordable housing. I'm not talking about something like government
• 12:20
  Speaker 1: subsidized but I'm talking about, you know, don't buy a
• 12:23
  Speaker 1: five thousand, eight thousand square foot mansion mcmanchain. Once you
• 12:27
  Speaker 1: buy something that's a little bit more reasonable, smaller in size,
• 12:29
  Speaker 1: easier to build, a more affordable, less to maintain, less
• 12:33
  Speaker 1: to furnish. I mean, across the board, Owning a smaller
• 12:36
  Speaker 1: home is far more financially prudent from my perspective.
• 12:40
  Speaker 2: Yes, and one of the things we need those that's
• 12:44
  Speaker 2: a longer term problem. In other words, it's not something
• 12:48
  Speaker 2: that a president can fix, you know, within a year. Right,
• 12:53
  Speaker 2: that's a longer term building problem. It is also, frankly,
• 12:57
  Speaker 2: a problem that cuts across political barriers, where you have
• 13:04
  Speaker 2: environmentalists who are really worried that you might have to
• 13:07
  Speaker 2: build some more roads if you're going to build houses
• 13:10
  Speaker 2: or more houses, because each of those houses is going
• 13:14
  Speaker 2: to have a family that's driving, so you need more
• 13:17
  Speaker 2: roads out there. They don't like that because they think
• 13:20
  Speaker 2: it'll cause climate change to accelerate. So there's a lot
• 13:25
  Speaker 2: of barriers to trying to get it done. We can,
• 13:29
  Speaker 2: I believe, and I think we will over time solve
• 13:31
  Speaker 2: this problem, but it's not something that's going to go
• 13:33
  Speaker 2: away quickly. Frankly, Also, Donald Trump's immigration policies are very
• 13:39
  Speaker 2: helpful in this regard. I know a lot of people
• 13:41
  Speaker 2: say the opposite. They say, oh no, a lot of
• 13:43
  Speaker 2: the illegal immigrants are engaged in building, but they have
• 13:47
  Speaker 2: to but before they can build one house, they have
• 13:49
  Speaker 2: to live in one. And they were frankly, when you
• 13:52
  Speaker 2: have twelve million people come in over just a few
• 13:54
  Speaker 2: short years, you are using up a lot of your
• 13:57
  Speaker 2: housing stock. Cutting down on that will actually provide some relief.
• 14:01
  Speaker 2: It creates supply for people who are legally here.
• 14:05
  Speaker 1: Right our financial editor John Karney talking about tonight seven
• 14:08
  Speaker 1: ARS seven pm Empower at You America Dot or one
• 14:11
  Speaker 1: more thing I have to ask you about John before
• 14:13
  Speaker 1: we part company this morning. In very enlightening conversation, It's
• 14:15
  Speaker 1: been the job market, the jobs that are out there
• 14:20
  Speaker 1: that are available, the level of employment. That all is
• 14:22
  Speaker 1: part of what the FED factors in a determining interest rates.
• 14:24
  Speaker 1: Do you see sort of a very quick upheaval in
• 14:29
  Speaker 1: the job market is brought about by artificial intelligence. I
• 14:31
  Speaker 1: mean more and more people are losing their jobs to AI.
• 14:34
  Speaker 1: A lot of people can be replaced now with artificial intelligence.
• 14:37
  Speaker 1: Is there going to be sort of a sudden mass firing,
• 14:40
  Speaker 1: you know, over a very much shorter period of time
• 14:42
  Speaker 1: than we typically see what the job market. Do you
• 14:44
  Speaker 1: foresee something like that happening and might that impact the
• 14:47
  Speaker 1: whole FED decision in the future.
• 14:50
  Speaker 2: I don't think we're going to see a sudden shift.
• 14:53
  Speaker 2: One problem with trying to read the labor market right now.
• 14:56
  Speaker 2: This normally would be a jobs week where we would
• 14:59
  Speaker 2: have a job for on jobs Friday, first Friday of
• 15:02
  Speaker 2: every month. We're not going to have that this week.
• 15:05
  Speaker 2: We're actually, and we've been we're missing jobs reports because
• 15:09
  Speaker 2: of the government shutdown at the Democrats cause because they
• 15:12
  Speaker 2: wouldn't vote for appropriations. I think so it's a little
• 15:16
  Speaker 2: hard to tell what's going on right now, and I
• 15:17
  Speaker 2: don't think we're going to get a sudden AI jump.
• 15:20
  Speaker 2: I think the AIS immediate factor will be something on
• 15:25
  Speaker 2: the realm of around displacing five percent of jobs. Over
• 15:30
  Speaker 2: the longer term, we may get more, but that means
• 15:33
  Speaker 2: a meeting that would have twenty people will have nineteen instead,
• 15:37
  Speaker 2: and the economy will be able to adapt to that
• 15:41
  Speaker 2: relatively quickly. Over the long term, there may be a
• 15:44
  Speaker 2: big shift in the kind of jobs people do. But
• 15:48
  Speaker 2: I don't think we're going to see like half the
• 15:51
  Speaker 2: jobs go away sometime next year.
• 15:54
  Speaker 1: It's a plus, John Carney, Tonight seven pm. Log in
• 15:57
  Speaker 1: and Poweroamerica dot org. Hell, log in right now so
• 15:59
  Speaker 1: you register. Starts at seven pm. It's going to be fascinating.
• 16:03
  Speaker 1: Tell your friends about it. And again, you don't have
• 16:05
  Speaker 1: to drive out on the roads to see this one.
• 16:06
  Speaker 1: It's virtual only. John, Thanks for your time today. I
• 16:08
  Speaker 1: appreciate you doing the empower you seminar, and appreciate everything
• 16:11
  Speaker 1: you're doing in Breitbart. It's just a great website and
• 16:14
  Speaker 1: I encourage my listeners to check it out regularly. John.
• 16:16
  Speaker 1: Until we talk again, Man, have a great day.
• 16:19
  Speaker 2: Thanks for having me.
• 16:20
  Speaker 1: This has been great, My pleasure.