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In this short clip, Patrick Bet-David, Bas Rutten and Adam Sosnick talk about the household wealth dropping by 13.5 trillion dollars.
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Household wealth drops ready 13 and a Half trillion dollars from January to September second worst destruction on Record this is a market watch story page Eight American also lost about 6.8 Trillion dollars in wealth in the first Three quarters of 2022 the stock market Shed more than 25 percent of its value The Federal Reserve reported Friday Nominal net worth fell four point six Percent to 143 trillion dollars as a Market value of assets fell by six Trillion dollars and liabilities Rose by 900 billion dollars household balance Sheet assets minus liabilities were Popped up by 10 increase in home equity Which is a greater source of wealth for Most American families but the loss in Real wealth from January through September was about twice as large as The nominal loss thirteen and a half Trillion dollars In current dollars after accounting for Rapid inflation experience this year Inflation makes both debts and Liabilities worth less in terms of Purchasing power notice what it says Here that most people's wealth is tied To what home equity right home equity Um that's going to disappear in 2023 for A lot of people let me say that one more Time That's going to disappear for a lot of People in 2023 that Equity I know people
Don't want to talk about it here's the Thing uh uh you know if you're if you're Living in a house you're like what do I Do with 300 000 you know I have equity In the house do I sell it do I not sell It are you planning on living in this Place for 10 years yes don't worry about It don't worry it's it's meaningless It's pointless oh okay got it hey what Do I do I got 300 000 in equity how long Do you plan on living in this house Probably another year and a half Max Okay worry about it okay because you got To figure out a way to do something with That part there so it's it depends on What situation you're in you know we Were looking at the rates of a house Because my my guy flew in Goldman Sachs Again we're having a conversation with Our quarterly meeting and he was telling Me you know what we locked in your rates At in the show he says you know what it Would have been today It's meaning people that are buying Today to the rate the difference in Payment is not a small it's Astronomically different in payment this Is what you're you know my guy was Paying six grand a month this could be Same thing could be a nine twelve Thousand dollar uh payment for same Exact value of a loan by the way until You cannot take on me oh home's Gonna Keep the values they're not 2023 is
Going to be rough for a lot of Realtors And loan officers and and I don't think It's going to slow down so about 1824 Will be the first year of relief so what You're saying is basically I bought a House for 400 000 right I put I made Upgrades I did whatever it's worth 500 000 now now because what you what you Guys are saying is now the the value of Houses is dropping so you got to get rid Of this oh only like only because rates Are skyrocketing so so people remember Rule of thumb we've talked about this Many times rule of thumb people don't Buy a house based on the loan amount or The interest rate people buy a house Based on the payment no one goes to the Bank and says give me a 600 000 loan They go and say I can't afford five Thousand dollars a month what size loan Does that qualify for no one goes and Says I want a million dollar loan they Ask they solve for payment so the Payment just doubled give or take so the Average person's like hey I can't afford A eight thousand dollar payment six Thousand dollar payments okay good luck You went from an 800 000 home to now 600 000 home what are you talking about I Can't get nothing for 600 without Totally get it but that's what just Happened but but reality is going to Sink in in 2023. yeah this is there's Something else below the surface here to
Step on this is that Americans we already talked about Um over the past month we've talked a Couple times about how Americans credit Card balance is Pat are right back up Remember they went down when all that Money came from the government and now They've popped right back up well why Are they been popping up because Inflation they've been using credit Cards for things and it shows here and All the discussion about the 13.5 Trillion in wealth houses and stuff There was 900 billion dollars in real Liabilities by the U.S consumer that is On credit cards They don't have short-term loans they Don't have signature loans you know it's A few people have home equity loans but The majority of the rank and file of America is 900 billion dollars and Interest rates are going up so are Paying more interest on that so the talk About the real recession next year isn't Just because oh the narratives off the Election the midterm elections so it's Safe to talk about it it's that this is What's coming Americans now have as much Or more debt as they had before covid as Much or more before all of the bailouts Point one interest rates are higher so What they're paying the interest on that Is higher inflation is made basic goods And services gasoline down I said it yes
It's a good thing but everything else is Still up and still growing so I can't Afford my life I'm more in debt and Interest rates are up and be paying so The spending is going to go down Consumer spending is going to be Dropping and that's what's going to drop Us into recession when the engine of the Economy the consumer can't afford to buy Things because they're more in debt the Interest rates and the debt is up You see how that all comes together it's A simple little puzzle and that's and That's where it's going the other Interesting thing is right now uh before Covid the average inventory of vehicles On Lots was around 3 million cars in any Given week would be available on Lots Total total yeah any given any given Week to be about three million finished Cars available for sale right now There's about a million cars available For sale which is up significantly Because remember the middle of covid we All learned that when chips are Expensive or you can't get chips oh yeah You could build the whole car but then You needed like the five chips that go Into the dashboard system yeah and they Had to wait for those well now some of That supply has come back there's a Million cars available out there but We're still almost at an all-time high And the car car loans are now up at
Eight percent so guess what the million Cars were sitting there consumers have a Lot of debt they can't afford to do it So all of these things are going to Represent what the real recession is Coming and I believe the numbers that We're seeing on job losses that there's About two million jobs are going to be Lost by mid-year Two million jobs are going to be lost by Mid-year so that's the real you're Saying real recession because right now This is like the kind of like man Recession well we're going for like You're talking about like like Armageddon I'm saying that arm again no No would you bet on the consumer the Next six months pumping up the spending To help the economy I don't think so I Don't think so yeah they can't so what All the craziness taking place I believe Future looks bright if you believe Future looks bright get your latest Future looks bright hat of valuetaining It says future looks bright here future Looks bright here we got them in white We got them in Black we got them in red Are black on black sold out these are About to sell out if you haven't ordered One yet we had a person in Michigan but One then he bought three then when those Three people wore it in the office they Had to order 58 of them because people Wanted the future looks bright hat
Especially during times like this Because ain't nobody's saying future Looks bright toward your future looks Bright hat click over here and to watch The entire podcast click here take care Everybody Foreign [Music]