Growth in the U.S. slowed considerably during the first three months of the year as interest rate increases and inflation took hold of an economy largely expected to decelerate even further ahead. According to the Commerce Department, gross domestic product (GDP) rose at a 1.1% annualized pace in the first quarter. Economists surveyed by Dow Jones had been expecting growth of 2%.
In this episode of The Higher Standard, Chris and Saied examine this news and determine the effect it will have on the economy as a whole.
They discuss a report stating that U.S. home prices, as measured by the seasonally adjusted Case-Shiller National Home Price Index, rose 0.15% between January and February. This month-over-month national home price uptick comes after national prices had declined every month between June 2022 and January 2023.
Chris and Saied look at news showing the continued decline of First Republic Bank's stock, an ongoing rout that has erased 60% of its value just this week on concerns about the bank's financial health in the wake of two other bank collapses.
They also offer some thoughts on the apparent end of the severe contraction in the US housing market over the past year, a bottoming-out which is raising hopes on Wall Street that America could avoid a recession altogether.
Join Chris and Saied for this fascinating and informative conversation.
What You’ll Learn in this Show:
The definition of gross domestic product (GDP).
Why businesses have been drawing down inventory and cutting equipment purchases.
Why home values don’t just drop across the country at the same time.
Why historically, housing has been a critical driver of the broader business cycle.