#Fed #Economy #Recession
Deutsche Bank Securities Chief U.S. Economist Matthew Luzzetti joins Yahoo Finance Live’s Akiko Fujita to discuss why the Deutsche Bank is the first major bank to call for a recession in 2023 as the Fed pivots to fighting inflation.
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“Household balance sheet is healthy” that is for now. That will change with the high inflation and negative real income.
What is this guy you’ve been talking about wages are at all time lows Nobody is getting raises a reason why there are more jobs than unemployment not unemployment it’s because nobody wants to work for low wages
V
Not leving 💎💪AMC to 6 digitals 🚀💎❤🚀
Brian asked a great question, good job.
Not just a recession but we need a huge crash to end this money printing Ponzi scheme 😡😡😡
Do these views on the economy ever come true?
It’s already here. Wake up
The Recession should of happen 2 years ago, the FEDS just postponed it. If it had of, we would been climbing out by now!
We need a serious RESET from all this price gouging. Companies will be begging to sell products!!
These ‘experts’ assume with their baseline (model) that everyone has money in their bank accounts, and that’s ‘probably’ the top 20-30% of workers, but the rest are getting crushed by the inflation. In addition, when all people see inflation of literally every items, they cut spending and change habits. This monster system is solely based off consumerism and nothing else and that’s one of its major flaws. We will see a recession and it will be really bad.
Exactly even a kid understand U.S. economy is credit and consumption.
Cut both with inflation and rates and see it thank.
I think the Fed should begin rapid balance sheet reduction first, before raising any Fed interest rates.
The current inflation is mainly due to the Ukraine war, Covid-19 disruption, deglobalization, and QE, which cannot be solved via interest rates.
Raising the interest rates will only let ordinary people suffer more, especially with the increase in the mortgage/rent payment.
For ordinary people, the effect of double the mortgage/rent payment is much higher than double the energy & food bill. People can go through the unavoidable increase in their energy & food bills, but why should the Fed add a much heavier layer of higher mortgage/rent to them quickly before they can go through the higher bills first?
The rapid expansion Fed balance sheet via the QE program is unhealthy, and it mainly creates inflation and helps the people in the financial world, while the interest rate affects the living cost of every ordinary people.
I think the Fed should start the rapid balance sheet reduction first, while raising the interest rates only after the reduction is finished, and give some time to the ordinary people to let them have enough income to pay for their monthly bills.
Recently, lots of investment banks and financial institutions urge a quicker increase of the Fed rates, which will only benefit themselves but not the general public, as the investment banks have already purchased lots of derivatives against the well-informed rates rise. The quicker raising rates make the financial cost and holding time value premium of the hedging derivatives lower, and the higher rates let the banks earn much higher interest payments after these hedgings. While ordinary people have not done any hedging.
Originally, the bankers should not earn so much profit from these hedgings. But if the rates are raised much higher and quicker, the bankers can get big profits from the lower cost derivatives, and also enjoy higher interest payments from their fixed-income securities holdings after this profit, while they also earn the money from the loss which Fed made during the selling of their holdings with a lower price after its rates rise.
Rates up first -> bonds price down -> later Fed reduce balance sheet with a lower price -> public Fed lost money to private bankers -> BAD.
Reduce balance sheet first with a normal price before rates up -> public Fed does not lose -> raise the rates after balance sheet reduction -> GOOD.
After transferring so much wealth from the public into the private bankers via a quick hudge rates rise, If the balance sheet is still not reduced, a recession will come as every ordinary people are suffering from the rapid huge rates disruption without hedging, and Fed will just see the increase and later reduce the rates, as well as, create an even bigger unhealthy balance sheet!
What is more, in order to maintain the US dollar hegemony, both reducing the Fed balance sheet and keeping the Fed rates stable are very important, as no one wants to hold a volatile and massive expansion thing.
Amazing FED actually did a net QE $450M last week!
Lol don’t panic don’t prepare sound like a hidden agenda
FED just care about their brokerage account.
No, Biden is tipping the US into a recession. He is going to our enemies for oil, instead of increasing oil in US. Canada wants to send us oil and is offended.
Biden is increasing food shortages as he is paying farmers to destroy food crops! $1700 an acre! In his budget he wants to increase the budget to pay $2 billion more to farmers to destroy their crops! Then says “the food shortage will be real.” Grocery store CEO said food prices will be up 10% next month.
I can give more! Why is the media cover him up so much? I can’t trust these people
Blablablabla
best comment
The Fed needs to raise interest rates. It’s long overdue. Our economy is not healthy right now as a result of cheap money.
They can’t it’s too late
I have stopped listening these future teller; 99% of them went wrong, they just kill your time.
No questions about the inflationary effect of the FED financing the government’s 1 Trillion+ deficit spending?
The feds have a 3 year plan. That’s a long time!
In order for the Fed to stop inflation it must stop consumption. That is how it works. That means, yes, there must be a recession. It is as certain as when temperatures fall below 32 degrees things freeze. The problem is that current investors have enjoyed a Fed supported stock market, and believe that is its sole purpose. Unfortunately, that is not true.
Either raise interest rates well above inflation or cause shortages to stop consumption.
3.5% Fed funds rate does nothing to stop the +10% rate of real inflation (including food & energy) that presently prevails in the U.S. And that rate will get worse as energy sanctions in Europe begin to bite. The Fed funds rate must rise to be greater than the rate of inflation in order to bring inflation under control. That is simply an economic fact. You need to talk with economists rather than bankers, stock market investing professionals, consultants, talking heads, stock market news channel ‘experts’, or wishful thinking investors. Economists know how it all works. Too bad there isn’t any economists here for as far as the eye can see. But, maybe that’s something Yahoo Finance just does not want to deal with nor hear.
I wish I could like twice
Spot on! 3.5% funds rate will do squat!!
I agree with the guts of what yo said. However, I thought some bankers are qualified economists?
@hon liong yes they are unless they’re biased
Recession is always a year away.
Question: The US Fed has given banks very low interest rates for quite a while, BUT the banks have not raised the interest paid on saving’s accounts and/or lowered interest charged on charge cards. The Question: Are the banks in financial trouble and/or are they just plain greedy?
What is “Greed”? Of course none of us are greedy it’s always the other guy. The banks also kept interest rates on homes and cars very low during the easing period. Credit card rates were high long before, but they didn’t raise them. Interest rates are determined by the supply and demand of loanable funds. If the banks arbitrarily charged 20% for home loans how much business would they get? What if they charged 100%? The market determines the rates not greed bankers.
@Donald Kinsey a. “What is “Greed”?” You don’t know?
b. If banks don’t want to pay interest on saving’s accounts that at least keep up with the true cost of inflation, then less people will save less money with those banks. Less money saved with those banks, less money that bank can loan out, even with fractional reserve banking.
c. Credit card rates: banks didn’t raise them, but they didn’t lower them either, even though they could have.
d. “The market determines the rates not greed bankers.”
Of which, people that want to save money for future expenses and/or want to get loans, will go elsewhere if they are able to. Even Trump went out of America to get certain loans.
@Charles Brightman You completely missed my point, but most non-business people usually don’t understand.
The banks don’t set the interest rates. They are price takers. The market determines the price.
During the period of low interest rates, how much did you complain about the low interest rates for buying homes or cars?
2:26 is just another reason why no one takes “yahoo news” seriously
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Am interested in this but am a bit skeptical about crypto
@Lucky Morgan Same here I will give him a try 4000usd for a start.
Share the strategy please
You’re not in crypto
Yes. You need to talk to my best mate Bernie Madoff. Above average returned guaranteed. Sadly, he was in jail, and died in jail.
ALL journalist should have their articles labeled as Opinion Pieces,
How can anyone call it “job growth” when it’s just the same jobs reopening after the pandemic? That’s like me dropping a donut on the ground, and then picking it back up and calling it “donut creation”. It’s easy to have job openings when 1 million people die within 2 years from COVID. Plus, you got another 2 million people suffering from long COVID that can no longer work, or at best only physically able to do part-time shifts? Plus, you got several million people quitting their jobs…because those jobs are shitty jobs.
Mmmmmmm….donuts!
Truth. Also, consider they keep saying “increase” in average earnings, but neglect to point out that it’s half the rate of inflation. Smh..these people.
Who is this guy kidding?
Shutting down the country for two years, money printing, giving money to people
Not to work, stim checks, who would have thought this would have been bad for the economy 😂. Now I need some expert to tell me this was bad and we are going into a recession because of too much money printing. I knew from the beginning when they started this the outcome was going to be a nightmare and people were going to be worse off. The rich will benefit from this!
I thought the same thing! How could they afford giving millions of people thousands of dollars (not to mention giving women w/ kids even more money) three times !
As expected upon the election of Joe Biden, economic recession.
,..twitter loses money whereas Facebook earns $30b/yr
,,Amazon is fantastic with a lucrative AWS and advertising ($30 billion and growing at 32%), delivers more than UPS.
_ Facebook is fantastic with a P/E 14 and $40b in profits that grows at 34%.
– Google is fantastic company with a lot of moat.
– Microsoft is fantastic with a lucrative Azure cloud and growing fast.
– Apple is a safe company that held its ground while other stocks fell.
– Wells Fargo
Interest rates to the moon. Yeah.
It wouldn’t surprise me if households have begun to shift debt to credit cards to afford the cost of living.. That’ll cause numbers to look better than they actually are if people are holding cash this way.
4 billion in consumer credit on february says it all
@franklin tejeda overwhelming 😔
If FED cared about inflation they would have done something about it by now.
US wants inflation to deal with the debt load
It’s would be stagflation….USA need growth to pay their debt..if not…America just another printing make another more inflation…food product , oil, metallurgy supply already get distrupted by Ukraine war and Russia sanction and America not controlling that…
Fed and Biden is destroying this country like this fake news !!! Fu all
Print $20+ Trillions of fake money in ~3 years and destroy the value of money or invade a country. Which one is worse ? Can they be related?
I believe that the USA does not have 11.5 million job openings/ I believe people are being laid off know! Some people win; and lots will suffer! Biden is a bag man!! No put! Election year; tame inflation or lots of Dems will loose the job! Can’t blame COVID; Putin; Trump collation; they wanted to Govern; the USA will never say they had a fraud election; “greatest country” 80 million Voters for Biden / there so many headwinds/ Biden is a week late on everything. The most corrupt government in the world! Pelosi/ Hunter / inside trading/ Maxine Waters daughter/ fraud!! Biden is a born lier! I wish his mother would have swallowed!
The brainwashing power of these institutions is mesmerizing, maybe this was inevitable for society to finally improve.
Recessions happen and is not bad. To many of these talking heads aren’t old enough to have seen one as an adult.
EV’s in Full production in 2023….* SOLO…3 Wheel EV.Electra Meccanica. Revenue Up 270 % yr to yr.
hopefully, thats what we need.
so we good til the end of next year?
well i remember the fed saying ” there’s no inflation”, this makes me very confident that they’ll send the economy into a recession
great recession for sure . possibility is a depression think pandemic,war, record historic bull run 30tril debt, 100 yrs since depression were in for hard times just depends if its 08 at best or worse
We all as US citizens need to pee on JeromPowel to wake him up, he is an evil, not a hawk, so what hawkish he is talking about I am a layman but I can do better than him, difference is he has hidden agenda, I don’t
he shoudnt be reappointed by the idiotic president
Why is there not enough products that says made in America
💣You are paying more than double for your gasoline since Joe Biden and the democrats killed the Trump economy; check the price of your food stupid. In addition, all that democrats are doing for the USA economy is just selling weapons to kill people in Ukraine.
ROME (AP) — Prices for food commodities like grains and vegetable oils reached their highest levels ever last month largely because of the sanctions impose on Russia by the EU and USA the “massive supply disruptions” is, threatening millions of people in Africa, the Middle East and elsewhere with hunger and malnourishment, the United Nations said Friday
After 2014 government change in Ukraine by USA, they sold Ukraine to Rothschild and Comp. and started HOMOSEXUAL PARADES, AND NOW THEY BROUGHT UKRAINE TO THE STATE OF SODOM AND GOMORRAH!!!! PUTIN = TRUMP = AN ANGEL OF GOD!!!!yes
There’s a Recession every 9th year of every Decade, this Recession is Past Due……1929, 1939…..1969, 1979, 1989, 1999, 2009,….
* Well where’s 2019(aided by the Pandemic, Foreclosure/Rent Eviction Moratorium, extra EDD Benefits and extended EDD Benefits, 3 Federal Stimulus Checks, CA issued it’s own Stimulus Checks so for CA it’s 4th Stimulus Checks)
ALL these Government interventions just help delay the inevitable on the Horizon….
There will be a HOUSING CRASH Worst than 2008 because 2008 affects ONLY the Lenders/Borrowers/HomeOwners/Banks/etc…..This ONE effects ALL industries, including Hotels, Travel, Tourism, Casinos, Outlets, Malls, etc… Except for Trucking, Produce, Farming, Markets, and parts of Food/Restaurants….
The HOUSING CRASH is Coming, “if” y’all been saving $$$ for affordable and 1st time Home Ownership, YOU DON’T HAVE TO WAIT TOO LONG BUT DON’T JUMP IN JUST YET…
WAIT UNTIL ALL THE GOVERNMENT HELP, FORECLOSURE/RENT EVICTION MORATORIUM EXPIRES…..6 months after that is a good time to start Looking for bargains…..
The FEDs are expected to raise interest rates a few times this year to stomp inflation and this indeed will make Homes mortgages a lil more expensive so Home prices will eventually fall……
we heard that before.
Always crack heads on Yahoo. We are already in a recession. Europe especially
Who really is the fed?
What did they do for me ?
To much inflation and job market heating up to beyond full employment causes the U.S. FED to raise interest rates so the economy is put downward to raise unemployment rates and lessen buying product and services in the economy! Recession now is suppose to great for the U.S. economy I guess. Who know what they are up to? It is the Biden’s Administration after all!
3.5% is this guy serious ?
At 2.75% in 2018 when all was good the market fell 18%!
Isn’t Deutsche Bank Drupmpfs default lender? Third rate bank
They have to cause recession because it is the only way to fix the mess we are in. Don’t get me wrong I have tried like hell to blame one single person or one single Institution for what’s about to happen but I realize and understand fully that it is the effect of so many causes. Truth be told it is the fault of broken system, capitalism, greed, covid, Ukrainian War, Ulta low inventory on homes in the entire country just to name a few… but the main reason why is because it’s inevitable, it’s the way it was always going to be and the way it has always been in history. The expiration of every currency is generally around the hundred year mark. The currencies that have much success pay for their own arrogance
There is a housing shortage in America…. if you raise rates, Americans will stop buying houses and the builders will stop building…. WTF…. Inflation will go down once we fix the fcuking supply chain and inventory shortages and delays. Increasing rates is so fcuking myopic. Raising rates isn’t going to bring rental prices down…. its going to force prospective first time home buyers to continue to be outpriced out of the market and keep rental rates high…. the Fed is full of blind, deaf, mute idiots.
Les recomendé un corredor profesional hace algún tiempo, ¿puedo encontrar a una persona que haya invertido con ella?
Comenta abajo
vamos
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Yo también lo dudaba antes de intentarlo… Y no fue arrepentimiento.
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God of ribah & the dentist of the Hells are happy enough.
Interest: management fees & development charges.
“Worried about inflation”…the epitome of shortsightedness. Anyone with a rudimentary understanding of macroeconomics said this was a certainty on March 23rd 2020 when the fed “backstop” was announced to stop the economic impact of covid. You can’t inject trillions into the economy and not have runaway inflation, it’s very basic economics that’s well demonstrated throughout history. History we continue to choose to ignore. Time to stop and smell the tulips
Biden strategy…blame others.
good luck and godspeed
consumer spending = double dip recession ??
Funny Trumplicans blaming Biden for gas, inflations, recessions when its actually happening in all countries in the world. BrainIess sheeps.
The American economy is permanently FUCKED!