August 11, 2022 • 12 mins
With inflation, rising interest rates, and historic market volatility do we need to be worried about the possibility of a recession? In this episode, Gregory and Dwayne Stein discuss if a recession is a possibility in this economy.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Podcast Intro / Outro (00:00):
Hey welcome. I'm your host Gregory
Ricks a financial advisor hereto answer your questions and
help you win with your money.
On today's episode of the AskGregory Podcast, we have Dwayne
Stein joining us from MortgageGumbo, and today he'll be
discussing with Gregory theimpacts of a possible recession
and what that can say for oureconomy. Also, we have a couple
(00:21):
of battery download waiting foryou on this topic. If you go to
gregoryricks.com/podcast94Again, that is
gregoryricks.com/podcast94
Gregory Ricks (00:33):
You know where are we own a recession, kind of
some outlook some some takesfrom first trust that they were
noting into the second half ofthe year. And that's their
article and we'll read from it alittle bit as we head into the
second half of 2022. The latesthot topic appears to be whether
(00:58):
or not the US economy is on thecusp of a recession. Real GDP
growth did come in at anannualized negative 1.6% In the
first quarter of this year.
According to data from theBureau of Economic Analysis, the
technical definition of arecession is two consecutive
(01:20):
quarters of negative GDP growth.
opinions on this topic vary.
Some pundits believe the USeconomy is already in recession.
Brian Westbury, Chief Economistof first trust is not one of
those was berry notes that theofficial arbiter of recessions
(01:40):
the National Bureau of EconomicResearch considers other factors
beyond just the real GDP,including job market,
manufacturing activity and realincomes subject to change.
wesbury does not currentlyforesee a recession arriving
until late 2023 or 2020. Forinflation, the war between
(02:07):
Russia and Ukraine and supplychain problems continue to
dominate the headlines, as wellas the next hurdle could be mid
term elections on Novembereighth. Dwayne Stein, welcome to
the show, and host of moralgumbo also, hey, I'm doing
(02:27):
really good this morning. Howabout yourself, man?
Dwayne Stein (02:34):
Man? Look, it's it's been absolutely a little
crazy. I know you're hearingabout it and everything that's
going on right now. So you knowwhere we're staying. I feel like
I'm getting into your realm,Gregory in the financial side.
Because, you know, on my show, Ithink it's so important. And you
(02:56):
taught me this is just makingsure that you get information
out to folks that that's what'simportant, whether it's good or
bad, it is what it is right. Andyou know, I can remember when
all those security changeshappened years ago. I mean, you
are on the forefront of that.
And that's kind of where we'reat right now. What I'm trying to
help people understand is, whereare you getting your information
(03:17):
from? Because the inflation isreal. I hope to gosh, the guy
that you just named, that said,the recession, he's looking at
2023, the end of 2023 early, Ihope he's really wrong. I hope
unfortunately, that it's here alot sooner, right. So we can
sort of get on the back end ofthese things. Because if people
(03:38):
think it's it's bad now, westill, in my opinion, have not
even come close to peaking whenit comes to these inflation
numbers. And so it's somethingthat we're keeping an eye on.
And what I'm asking folks is,where are you getting your
information from? Or are youjust kind of moseying along,
going, hey, we'll see how thisworks. And figure it out from
(04:01):
there. Where are you gettingyour info from? That is the key
right now.
Gregory Ricks (04:08):
You know, we saw consumer spending is increased
by 1% in data that I was readingthis morning, as well. And so
that's kind of surprising. It'sit's actually people aren't
letting this inflation stop themin spending might have been
(04:29):
increasing more. So it's been awhile back Psalm. But I, I think
what scaling are, that's theslow way. And what are you
seeing from the housing side?
Because I will tell you, I'vesaid this, and I'm not changing
it. But I'm gonna dig into somemore of first trust data and
other data that I'm getting butyou know, as we get closer,
(04:50):
maybe we get an idea but I feellike energy prices have caused
enough for us to hit into arecession has caused enough
slowdown, but there could be youknow, just like wesbury said,
there's some other things thatare offsetting, and I would
(05:11):
rather get through thatadjustment sooner than later,
we're just going to keep thisfear going is relative, oh, now
the recession is coming. Andthen you know, the market would
drop 234 percent in the week,and then a stock, okay, it's
not, then it comes back. Sothere's so much fear that the
(05:34):
news is causing, and I'm kindalike, I think next year could be
a better here, not a worse year,I think the impact of the
elections on November 8, can isgoing to be one of two things is
going to kind of like, Oh, myGod, this didn't go well. And
(05:56):
that can be somebody's take onit. And that way, well, so much
for 2023 getting better, or iskind of like finally, we're we
hope to see some improvement.
But But that's kind of a anestimate, because we're we're
still a long ways away fromthat. And to see the outcome of
(06:19):
that. And in one judgment, wasBarry's kind of saying, Yeah,
we're not seeing improvement.
Next year, is what he's sayingand improvements coming. Another
two years, two and a half yearsout. That's kind of what he's
saying there. And I'm not likingthat.
Dwayne Stein (06:39):
No, not at all, especially when gasoline
Greggory it year over year. Andyou've seen these numbers,
gasoline, 60%, higher than itwas last year, at this time,
energy, like you talked about42%. In just one month, gas went
up 11%. And energy seven and ahalf percent Gregory. I mean,
(07:00):
that is nobody. And it's funny,because I'm sort of going back
to the basics. And I'm puttingtogether a personal budget,
right, and I'm going to sharewhat I put together for myself,
because I haven't had to do thisand gosh, knows how long. And
now it's like, you know what, Igotta get a budget together. And
(07:20):
it goes with what you just said,with retail spending, how many
people are cutting back,everybody still just rockin and
rollin throwing up that creditcard going from there. And
people don't understand thefederal funds rate. They don't
understand what it is. And, youknow, everybody I speak to is
like, hey, well, before the Fedspeaks, I want to get a mortgage
(07:40):
and it no matter eight years,I've been talking about it throw
in a couple years of doing yourshow. It's over 10 years of
trying to explain and peoplejust don't understand, but they
keep throwing up that creditcard. And that's where you
retail spendings up, how manypeople are not getting their
nails done? How many people havestopped eating out how many
people cancelled those streams?
Right? Not many yet. So that'swhy when I say the pain isn't
(08:05):
there yet, nobody's eaten Vianasausage, or potted meat and
sandwiches yet, you know what Imean? So, or ramen noodles,
which aren't even 10 for $1anymore? You know? So, you know,
that's my concern when we'relooking at this. And again, not
trying to scare folks. But youknow, when people talk Oh, well,
you know, you hear Gregorypeople within the housing
(08:25):
market, oh, well, they're goingto have to pull back, they're
going to have to lower mortgagerates to try No way, especially
with this data coming up. And ifthey haven't peaked, there's no
way they're pulling back onfederal funds rate or anything
to do with. I mean, you see whatthe 10 year Treasury is doing?
It's rising.
Gregory Ricks (08:46):
Yeah, you know, I like that. Getting into a good
spot with that. The other fearis the Fed, increasing their
basis 1% Going forward, I bet Ithink that's that was the fear
earlier in the week and impactedthe markets but I I think that
(09:08):
might be dialed back a littlebit. But one of the things I was
just looking at is impact of allproducts. When we we talk about
why I say that. There's how manyproducts are made from petroleum
about 6000 Everyday more than6000 everyday products get their
start from oil includingdishwashing liquid, solar
(09:31):
panels, food preservatives,eyeglasses, DVDs, children,
toys, tires, heart valves, thatthat's just to name a few. So
with oil being double, gosh,that's impacting so many things
in day to day life. And I thinkthat's what we're this continues
(09:52):
forward. But for that to getbetter. I do think it's going to
be a couple years out becausepolicy changes what's going to
impact that?
Podcast Intro / Outro (10:04):
Thanks so much for listening to Ask
Gregory where we answer yourfinancial questions. You can
find us anywhere podcasts can befound and on YouTube and
Facebook Live every Saturdayfrom 10 to 1!, Subscribe, leave
a review and tune in next time!And don't forget we've got a
couple of literary downloadwaiting for you on this topic.
(10:25):
If you go togregoryricks.com/podcast94.
Again, that isgregoryricks.com/podcast94
Disclosure (10:30):
Gregory Ricks & Associates is an independent
financial services firm thatutilizes a variety of investment
and insurance products.
Investment advisory servicesoffered only by duly registered
individuals through AE WealthManagement, LLC (AEWM). AEWM and
Gregory Ricks & Associates arenot affiliated companies.
Gregory Ricks & Associates, TheTotal Wealth Authority is our
trademarked tagline, it does notpromise or guarantee investment
(10:51):
results or preservation ofprincipal nor does it represent
a certain level of skill.
Investing involves risk,including the potential loss of
principal. Any references toprotection, safety or lifetime
income, generally refer to fixedinsurance products, never
securities or investments.
Insurance guarantees are backedby the financial strength and
claims paying abilities of theissuing carrier. This radio show
is intended for informationalpurposes only. It is not
(11:12):
intended to be used as the solebasis for financial decisions,
nor should it be construed asadvice designed to meet the
particular needs of anindividual’s situation. Gregory
Ricks & Associates is notpermitted to offer and no
statement made during this showshall constitute tax or legal
advice. Our firm is notaffiliated with or endorsed by
the U.S. Government or anygovernmental agency. The
information and opinionscontained herein provided by
third parties have been obtainedfrom sources believed to be
(11:33):
reliable, but accuracy andcompleteness cannot be
guaranteed by Gregory Ricks &Associates. Any media logos
and/or trademarks containedherein are the property of their
respective owners and noendorsement by those owners of
Gregory Ricks & Associates isstated or implied Gregory Ricks
& Associates has a strategicpartnership with tax
professionals and attorneys whocan provide tax and/or legal
advice. AEWM, Gregory Ricks &Associates, WJ Blanchard Law,
(11:54):
LLC, J Heath & Co. and MortgageGumbo are not affiliated
companies. This show is a paidplacement.
Hey welcome. I'm your host Gregory
Ricks a financial advisor hereto answer your questions and
help you win with your money.
On today's episode of the AskGregory Podcast, we have Dwayne
Stein joining us from MortgageGumbo, and today he'll be
discussing with Gregory theimpacts of a possible recession
and what that can say for oureconomy. Also, we have a couple
(00:21):
of battery download waiting foryou on this topic. If you go to
gregoryricks.com/podcast94Again, that is
gregoryricks.com/podcast94
Gregory Ricks (00:33):
You know where are we own a recession, kind of
some outlook some some takesfrom first trust that they were
noting into the second half ofthe year. And that's their
article and we'll read from it alittle bit as we head into the
second half of 2022. The latesthot topic appears to be whether
(00:58):
or not the US economy is on thecusp of a recession. Real GDP
growth did come in at anannualized negative 1.6% In the
first quarter of this year.
According to data from theBureau of Economic Analysis, the
technical definition of arecession is two consecutive
(01:20):
quarters of negative GDP growth.
opinions on this topic vary.
Some pundits believe the USeconomy is already in recession.
Brian Westbury, Chief Economistof first trust is not one of
those was berry notes that theofficial arbiter of recessions
(01:40):
the National Bureau of EconomicResearch considers other factors
beyond just the real GDP,including job market,
manufacturing activity and realincomes subject to change.
wesbury does not currentlyforesee a recession arriving
until late 2023 or 2020. Forinflation, the war between
(02:07):
Russia and Ukraine and supplychain problems continue to
dominate the headlines, as wellas the next hurdle could be mid
term elections on Novembereighth. Dwayne Stein, welcome to
the show, and host of moralgumbo also, hey, I'm doing
(02:27):
really good this morning. Howabout yourself, man?
Dwayne Stein (02:34):
Man? Look, it's it's been absolutely a little
crazy. I know you're hearingabout it and everything that's
going on right now. So you knowwhere we're staying. I feel like
I'm getting into your realm,Gregory in the financial side.
Because, you know, on my show, Ithink it's so important. And you
(02:56):
taught me this is just makingsure that you get information
out to folks that that's what'simportant, whether it's good or
bad, it is what it is right. Andyou know, I can remember when
all those security changeshappened years ago. I mean, you
are on the forefront of that.
And that's kind of where we'reat right now. What I'm trying to
help people understand is, whereare you getting your information
(03:17):
from? Because the inflation isreal. I hope to gosh, the guy
that you just named, that said,the recession, he's looking at
2023, the end of 2023 early, Ihope he's really wrong. I hope
unfortunately, that it's here alot sooner, right. So we can
sort of get on the back end ofthese things. Because if people
(03:38):
think it's it's bad now, westill, in my opinion, have not
even come close to peaking whenit comes to these inflation
numbers. And so it's somethingthat we're keeping an eye on.
And what I'm asking folks is,where are you getting your
information from? Or are youjust kind of moseying along,
going, hey, we'll see how thisworks. And figure it out from
(04:01):
there. Where are you gettingyour info from? That is the key
right now.
Gregory Ricks (04:08):
You know, we saw consumer spending is increased
by 1% in data that I was readingthis morning, as well. And so
that's kind of surprising. It'sit's actually people aren't
letting this inflation stop themin spending might have been
(04:29):
increasing more. So it's been awhile back Psalm. But I, I think
what scaling are, that's theslow way. And what are you
seeing from the housing side?
Because I will tell you, I'vesaid this, and I'm not changing
it. But I'm gonna dig into somemore of first trust data and
other data that I'm getting butyou know, as we get closer,
(04:50):
maybe we get an idea but I feellike energy prices have caused
enough for us to hit into arecession has caused enough
slowdown, but there could be youknow, just like wesbury said,
there's some other things thatare offsetting, and I would
(05:11):
rather get through thatadjustment sooner than later,
we're just going to keep thisfear going is relative, oh, now
the recession is coming. Andthen you know, the market would
drop 234 percent in the week,and then a stock, okay, it's
not, then it comes back. Sothere's so much fear that the
(05:34):
news is causing, and I'm kindalike, I think next year could be
a better here, not a worse year,I think the impact of the
elections on November 8, can isgoing to be one of two things is
going to kind of like, Oh, myGod, this didn't go well. And
(05:56):
that can be somebody's take onit. And that way, well, so much
for 2023 getting better, or iskind of like finally, we're we
hope to see some improvement.
But But that's kind of a anestimate, because we're we're
still a long ways away fromthat. And to see the outcome of
(06:19):
that. And in one judgment, wasBarry's kind of saying, Yeah,
we're not seeing improvement.
Next year, is what he's sayingand improvements coming. Another
two years, two and a half yearsout. That's kind of what he's
saying there. And I'm not likingthat.
Dwayne Stein (06:39):
No, not at all, especially when gasoline
Greggory it year over year. Andyou've seen these numbers,
gasoline, 60%, higher than itwas last year, at this time,
energy, like you talked about42%. In just one month, gas went
up 11%. And energy seven and ahalf percent Gregory. I mean,
(07:00):
that is nobody. And it's funny,because I'm sort of going back
to the basics. And I'm puttingtogether a personal budget,
right, and I'm going to sharewhat I put together for myself,
because I haven't had to do thisand gosh, knows how long. And
now it's like, you know what, Igotta get a budget together. And
(07:20):
it goes with what you just said,with retail spending, how many
people are cutting back,everybody still just rockin and
rollin throwing up that creditcard going from there. And
people don't understand thefederal funds rate. They don't
understand what it is. And, youknow, everybody I speak to is
like, hey, well, before the Fedspeaks, I want to get a mortgage
(07:40):
and it no matter eight years,I've been talking about it throw
in a couple years of doing yourshow. It's over 10 years of
trying to explain and peoplejust don't understand, but they
keep throwing up that creditcard. And that's where you
retail spendings up, how manypeople are not getting their
nails done? How many people havestopped eating out how many
people cancelled those streams?
Right? Not many yet. So that'swhy when I say the pain isn't
(08:05):
there yet, nobody's eaten Vianasausage, or potted meat and
sandwiches yet, you know what Imean? So, or ramen noodles,
which aren't even 10 for $1anymore? You know? So, you know,
that's my concern when we'relooking at this. And again, not
trying to scare folks. But youknow, when people talk Oh, well,
you know, you hear Gregorypeople within the housing
(08:25):
market, oh, well, they're goingto have to pull back, they're
going to have to lower mortgagerates to try No way, especially
with this data coming up. And ifthey haven't peaked, there's no
way they're pulling back onfederal funds rate or anything
to do with. I mean, you see whatthe 10 year Treasury is doing?
It's rising.
Gregory Ricks (08:46):
Yeah, you know, I like that. Getting into a good
spot with that. The other fearis the Fed, increasing their
basis 1% Going forward, I bet Ithink that's that was the fear
earlier in the week and impactedthe markets but I I think that
(09:08):
might be dialed back a littlebit. But one of the things I was
just looking at is impact of allproducts. When we we talk about
why I say that. There's how manyproducts are made from petroleum
about 6000 Everyday more than6000 everyday products get their
start from oil includingdishwashing liquid, solar
(09:31):
panels, food preservatives,eyeglasses, DVDs, children,
toys, tires, heart valves, thatthat's just to name a few. So
with oil being double, gosh,that's impacting so many things
in day to day life. And I thinkthat's what we're this continues
(09:52):
forward. But for that to getbetter. I do think it's going to
be a couple years out becausepolicy changes what's going to
impact that?
Podcast Intro / Outro (10:04):
Thanks so much for listening to Ask
Gregory where we answer yourfinancial questions. You can
find us anywhere podcasts can befound and on YouTube and
Facebook Live every Saturdayfrom 10 to 1!, Subscribe, leave
a review and tune in next time!And don't forget we've got a
couple of literary downloadwaiting for you on this topic.
(10:25):
If you go togregoryricks.com/podcast94.
Again, that isgregoryricks.com/podcast94
Disclosure (10:30):
Gregory Ricks & Associates is an independent
financial services firm thatutilizes a variety of investment
and insurance products.
Investment advisory servicesoffered only by duly registered
individuals through AE WealthManagement, LLC (AEWM). AEWM and
Gregory Ricks & Associates arenot affiliated companies.
Gregory Ricks & Associates, TheTotal Wealth Authority is our
trademarked tagline, it does notpromise or guarantee investment
(10:51):
results or preservation ofprincipal nor does it represent
a certain level of skill.
Investing involves risk,including the potential loss of
principal. Any references toprotection, safety or lifetime
income, generally refer to fixedinsurance products, never
securities or investments.
Insurance guarantees are backedby the financial strength and
claims paying abilities of theissuing carrier. This radio show
is intended for informationalpurposes only. It is not
(11:12):
intended to be used as the solebasis for financial decisions,
nor should it be construed asadvice designed to meet the
particular needs of anindividual’s situation. Gregory
Ricks & Associates is notpermitted to offer and no
statement made during this showshall constitute tax or legal
advice. Our firm is notaffiliated with or endorsed by
the U.S. Government or anygovernmental agency. The
information and opinionscontained herein provided by
third parties have been obtainedfrom sources believed to be
(11:33):
reliable, but accuracy andcompleteness cannot be
guaranteed by Gregory Ricks &Associates. Any media logos
and/or trademarks containedherein are the property of their
respective owners and noendorsement by those owners of
Gregory Ricks & Associates isstated or implied Gregory Ricks
& Associates has a strategicpartnership with tax
professionals and attorneys whocan provide tax and/or legal
advice. AEWM, Gregory Ricks &Associates, WJ Blanchard Law,
(11:54):
LLC, J Heath & Co. and MortgageGumbo are not affiliated
companies. This show is a paidplacement.
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