You Say Recession - I Say Poppycock!

While on the side of "there will be a recession within the next year" (depending on just how much rate cutting and economic stimulus takes place between now and then) ---- my message always includes a disclaimer on housing - home prices tend to go UP (or at least stay flat) during a recession.  Check out this history - in the last recession, a dip in home values CAUSED the recession (the bursting of a bubble), not the other way around.  Historically, home ownership is one of the best places to park money in a recession.

I do believe one is coming and that's OK. Market corrections are necessary to control irrational exurberance and excessive monetary policy. Life goes on and let's not confuse this with the Great Recession.

Everybody still seems to have the right idea as I come back to this one from yesterday! :)

I don't see a recession upon us either and boy did I see the early signs the last time!  I agree with you, there is way too much fear-mongering! I refuse to have the media dictate to me as well.  I am sticking to my business plan and I'm doing very well - especially over the past 3 years!  Carpe Diem!

Hi Patricia Feager, MBA, CRS, GRI,MRP,

Congratulations on your well-deserved feature!

I just got the numbers August to August and this August was slightly better in all categories. 

I believe the talk of recession is a scare tactic designed to harm the President. I don't think it will work - not with unemployment this low, wages rising, taxes lower, etc.

Some believe that if they say it long enough and loud enough, consumers will respond and quit spending money. I doubt it. So to your Poppycock, I'll add Balderdash!

I love the statistics given here in comments that show housing does well in a recession. So perhaps those who believe the hype will help you become even more successful!

Those are fun words, aren't they Patricia?

Although not in the investment business directly, I have been watching the markets and cause/effect over the last 4 decades via the lense of lending, Patricia Feager, MBA, CRS, GRI,MRP.  Little I see currently fits historic patterns.  Reactions seen and felt by the markets are not "normal".  That is being reported by the media.  No matter who ... no matter what party is represented in the White House, that is their role.  

Gene

With all the fear mongering ... it's still LOCAL ... and my clients rely on my expertise.  I don't believe there is any recession to be fearful of.  Correction? Yes, it has to happen and it is.  But the correction is good and expected.  Fear? No. This is not like 2008 ... 

I am often amazed how many agents will just parrot whatever popular lines have spread at their offices but have no clue what they are talking about. Prices in NYC have come down signficantly in the last year or so. Most agents were spouting this is because of the changes in the tax code disallowing full deductions of their property taxes- limiting them to just the first $10,000 (and a few other changes regarding home ownership).  Yes, that was a contributor to the reason why prices have declined- but for most situations- a small one as there were other tax code changes that helped offset this difference (not for everyone- but for a lot of situations).  This view neglected lots of other economic factors - some of which take a few years until the impacts are fully realized and the global political and economic environment.  The average person doesn't realize that in the context of macro economics that political, legal, economic changes can often take years to fully materialize. If congress changes laws today- it often takes a few years before the impacts are seen in the economy.  It can also change far faster- and the President is playing chicken with the economy when it comes to the issue of tarriff's. It's a risky game- and if he wins, he wins big. If he loses- he loses big- causing a recession. Games like this are tools of the business world- but can greater harm than good in a political context.

I don't advocate for most agents to talk too deeply about the economy unless they have the training or experience backing it.

About 5 years before I became an agent- I was viewing a new condo conversion building. I felt the apartments were way overpriced. The listing agent then trying to bolster his pricing argument, proceeded to try to give me a lession on supply and demand. I started laughing- and shut him down quick when I told him that I trained incoming analysts and associates on Wall Street- which sometimes included the basics of economics (depending on the program I was running at the time). While I was right on the pricing- I really hoped that agent learned something out of our conversation.

And the risks of tariffs causing a recession is real- contrary to opinions- this is a an actual risk- and is factored in quantitative modeling. What is "poppycock" is that a recession is looming simply because the expansion has lasted so long. It's also been a long slow climb upward to get to this point.

It's a pet peeve of mine when agents start commenting adding their opinion on economics when they don't understand the larger picture- or when they start injecting their own agenda- financial or political.