Danielle DiMartino Booth, CEO and chief strategist of Quill Intelligence, joins Jack Farley to ring the alarm bell about the housing and auto markets, which by her reading of the data are quickly deteriorating. Booth notes that while the credit quality of mortgages remain high, the mortgage origination market itself falling sharply and, because of a “biblical” quantity of single-family houses about to hit the market, Booth expects housing prices to continue to fall. Booth argues that the car loan market is in even worse condition, as car note defaults mount, the car values plummet and the jubilee-like monetary conditions of 2020 and 2021 wither away. Booth’s description of the car loan market reminds Farley of his reading of the subprime housing meltdown in 2007. Booth and Farley also discuss Bernanke’s Nobel Prize and the means and timing of a Powell pivot.

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Timestamps:

(00:00) Intro

(00:21) The Housing Recession

(09:39) The Brewing Auto Loan Wreck

(19:06) Is The Auto Loan Crisis Systemic?

(23:14) Sponsor ad Bitrex

(24:42) The "Winter" In Investment Banking

(26:38) The Fed Is Not Coming To The Rescue

(31:31) The Recession Started In January 2022"

(43:26) Will The Fed Bail Out The Treasury Market?

(48:37) The Bernanke Doctrine Is Failing

(51:10) Ben Bernanke's Nobel Prize: "The Prize Was Premature"

(53:57) Is Jay Powell Making The Right Move?

(58:38) Closing Thoughts On The Midterms In The U.S.

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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.