Politics

Financial Experts Predict A Recession Is Coming Due To Housing Rates And Trump’s Trade War

President Trump has been touting current economic growth as evidence that his policies are good for the country. Recently, he predicted that the 4.1% GDP growth during the April-June quarter would continue into the future. Financial experts do not agree.

Not only do financial experts disagree that economic growth will continue at the current rate, some are predicting a recession. Lindsey Piegza is Stifel’s Chief Economist. She appeared on CNNMoney Wednesday to discuss concerns that a recession may be coming.

Piegza said, “The housing market is throwing up a very large red flag in our opinion, suggesting that maybe this four percent gain that we saw in the second quarter is not sustainable.” Piegza continued saying, “Home sales have actually been on the decline for five of the past six months. and also, one of the biggest concerns is that as we’re seeing whole price appreciation continue to rise, incomes are very stagnant.”

She went on, “We’re seeing a growing divide between the cost of a home and the ability for the average American to afford that home purchase.” Piegza added, “We are not there yet… but eerily similar to what we saw leading up to the housing crash.”

Piegza is not the only financial expert who is concerned that the country may soon face another recession. Warren Buffet, who runs Berkshire Hathaway, has predicted the possibility of an economic crash using his market metric, the “Buffett Indicator.”

According to charts broadcast on MSN Money, the Buffett Indicator is at an all-time high. According to the Buffett Indicator, “nearly 149%, the total market cap to GDP ratio has never been higher. It’s even higher than the 145% peak we saw during the dot-com bubble.”

The Fed recently raised interest rates, a move that upset the president who said in an interview on CNBC, “I don’t like all of this work we are putting into the economy, and then I see rates going up.”

Treasury Secretary Mnuchin tried to manage concerns over the president’s criticism on Sunday when he told Fox News, “We as an administration absolutely support the independence of the Fed, and the president has made it clear that this is the Fed’s decision.”

Truth Examiner
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