Page 9 - Wealth Effect News Today

Right. if you look at interest rates, on the open market, two-year rates, 30 year government paper, which by the way is about equal to the fed fund rate, the rates have come down while the fed is hiking on the notes with respect to september. that tells you the fed has it wrong. what we have to be careful of, folks, if we get this rate cut next week and thats it? because data has started to look better again or do they keep on the rate cutting path that the market expects them to be on. >> one t...

People trying to get into our country, now, i dont think its necessarily a bad idea that our country has borders, think about how we communicate it, its very simple but its also very negative and both of these candidates do that. neil: does sanders tweet? >> he doesnt have the aoc snap on the twitter. [laughter] neil: one of the things the president tries to remind people about, the points that you mentioned, and all of the markets, they are going more his way although he doesnt mention the mark...

City paying rent to buy a house in spokane or somewhere else. it tells you about the wealth effect and the psychology of consumers. it is important that this turns around. what we do know from the home builders is foot traffic is starting to pick up again. one of the keys. once people look, the next thing if they can, they can get a loan theyll buy. >> sandra: china becoming the number one retail market over the united states? >> well, you know, they got a few more people than we do. 1.3 billion...

Economy or wed be in the er. in fact, and this has kind of been i think missed in recent commentary. the american economy is still really strong. the unemployment rate is well below 4%. consumer spending was booming in this retail season. wages are beginning to climb. i think its pretty late in the game to get the wages up but finally were seeing that. consumer spending is 70% of of this economy. if you go to europe, its 65%. china, its 40%. were a big consumer spending economy. were very inquis...

You look at the last inflation numbers. theyre very low. >> bill: so you look at the economic number, new home construction is off more than five points. they blame it on rising interest rates. so that kind of goes to the point he is mange. what do you think? >> also mortgage applications were down 7%. thats a huge decline. theyve been down 8 of the last 10 weeks. thats an important part of our economy. you could argue its even more important than the stock market when it comes to the wealth eff...

Sort of thing, lost in faith and tech stocks, whatever happened it hit stocks this week and they have gone down and donald trump should give himself more credit, deregulation that they did and those tax cuts have put such an enormous base under the economy right now that i kind of expect will be short term. paul: what about the wealth effect, james, they think its gone up, they look at assets and they feel, im feeling pretty good, i think i will go buy that car, you know, take that vacation, if ...

Basically lost a few months worth of gains in a great stock market. if you were in from election night 2016 you still crushed it even despite recent turbulence. paul: so you have to have a really much greater decline in stocks, 20, 30% before you saw tangible impact from a negative wealth effect? >> yeah, i have a hard time seeing that because that underlying economy is so strong. weve got both the st. louis fed and atlanta fed saying 4.2% growth this quarter, so -- paul: third quarter. >> third...

Companies expand and people have basically lost a few months worth of gains in a great stock market. if you were in from election 2016, he still crushed it even despite recent turbulence. paul: you really have to have a much greater decline in stocks. 20 or 30 percent before you see tangible impact from a negative wealth effect? >> i would have a hard time seeing that because of the underlining economy being so strong. we are both the st. louis fed and the atlanta fed saying 4.2 percent growth t...

Been donald trump trade with a weakening chinese economy, european economies go inside -- loss of tech stocks. whatever happened, it hit stocks this week and they have gone down. but i think donald trump should give himself more credit, deregulation they did and those have put such an enormous base under the economy right now. i kind of expect it will be short-term. >> what about the effects, people feel wealthier because they look at the 401(k) and think it has gone up. they look at assets and ...

They think there is better opportunities. why is that? because of the policies when you have deregulation and when you stimulate the economy where you let companies decide how they want to spend their money, which is better than the government. you are seeing it go to higher and better uses. so, when you look at the leading economic indicators like i said new orders index, when you look at the jobs numbers, theyre leading, right? because you are only going to invest in your property, your plant,...