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tv   Maria Bartiromos Wall Street  FOX Business  March 11, 2023 9:00am-9:31am EST

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it's easy to get lost in investment research. introducing j.p. morgan personal advisors. hey david! connect with an advisor to create your personalized plan. let's find the right investments for your goals. okay, great. j.p. morgan wealth management. call it racist for what it is and those who are racist but leave drivers alone, come on. >> from the fox studio in new york city, this is "maria
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bartiromo wall street". maria: happy we can all, walk up to the program that analyzes the week that was in helps position you for the week ahead. i am maria bartiromo we have a big show this week in the wall street wiseguys are back steve forbes and andy pozen are here plus famed economist is wording the markets are going to get hit by a perfect storm sheer, he will explain plus the ceo reacts to a new crisis brewing in the housing market. all that coming up but first another surprising jobs report out. 311,000 jobs added to the economy in the month of february versus the expectation of 205,000. the unemployment rate take tire to 3.6% and average wages were flat month over month, joining me forbes media chairman steve forbes and former ckd restaurant ceo andy puzder, great to see you thanks so much for being here.
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let me kick it off with you steve forbes wages seem to be the headline in this report they were up 3107% january and up to tens of 8% in february i would call that a flat showing, what say you. >> it is a flat showing it is been observed a lot of the jobs are being created and industries traditionally with lower pay and it's very strange that a lot of economists are saying g that's a good thing because the fed won't be quite as the aggressive when raising interest rates but wages are going up as much with the perverse environment where the worst economy does the market has a chance to get better because the fed won't bash it so much so it's absolutely perverse anyway wages are not going up the way that they have and it doesn't look like they will. maria: the jobs numbers, 311,000 jobs in february we were expecting a big revision in january and actually january jobs were up 504,000 down from
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the 517,000 number that we saw last month but still an incredible number in january. >> the numbers have been great on job creation, i think the reason is as a government benefits from the pandemic it's beginning to dry up and saving rates below historic and prepare them close and credit card debt above historic ties in pre-pandemic i we are finding that people need to get back to work and it's one of the reasons people are into the retail jobs and those were the job openings are right now and people need cash and back into work in the labor participation rate was up wages were not up as much because the demand for workers lessons if they enter the labor force. the numbers do tell a story and they tell the story of people needing to get back to work. >> at his leisure and hospitality and retail. andy those are lower paying jobs. >> they are lower paying jobs they are entry-level jobs, they
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are meant to get people to experience that they need to get into the labor force and to move up the ladder of opportunity you cannot just jump into a job as a vice president. particular young people having sat out outside of the labor market for the use of the pandemic and sense with the government benefits people have been able to receive their finding out that they need to get back in and they need to get the experience that is required to move ahead in life. this is a good sign this is not a bad sign. >> were also talking about the president's budget and biden set up a fight with republicans with the new budget. his wish list, taxes on the wealthy businesses, investors coupled with a lot more spending he claims it's going to cut the deficit by $3 trillion over the next decade. but the kitty for responsible budget is calling biden spending programs excessive growing the debt to a record share of the economy and only four years with the chamber of commerce says this is a recipe for economic and fiscal disaster.
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steve let me tell you this budget would borrow $19 trillion through 2033. he wants trillions in new taxes and he wants to take capital gains taxes as high as 45%, your thoughts. >> you have to think much about that, this is a formula for disaster and is very lucky that the republicans get a block in the house of representatives because you have a depressed economy going into an election and as jimmy carter can testify not a formula for reelection. this is a big budget, bloated bad budget and republicans are saving them from the. the judge pointed out what the real issues are going to be with the big issues in 2024, what kind of economy do we want do we want a european sluggish economy one maybe 2% growth, and good times and sluggishness after that or do we want the traditional vibrant economy with three and a half or 4% growth which is what were quite capable of if we do what we did under
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ronald reagan cutting taxes and deregulation and curbing on the spending side having so much as a stable dollar, it always works but they always ignore history because they want control or the prosperity. maria: look at the tax increases to talk about corporate taxes going higher. capital gains taxes going higher. he says is not to raise taxes on anybody making $400,000 or more but your 401k is getting ahead. >> also inflati inflation is a f you have 10% sales tax to spend hundred dollars you pay hundred and ten inflation is attacks but it's not over you're still paying for $100 of what you paid before to 110 with this kind of inflation. it is a hidden tax if everyone in the hits disproportionately lower income people. that's a boldface that's a lie when he says under 400,000 not getting hit by taxes. it's called inflation. maria: spent he did the next
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year which stretched to $6.9 trillion that is to have trillion above prepaid debit levels. 55% higher. it doesn't look like this is going to go anywhere because i spoke with speaker kevin mccarthy this is instead on arrival. your thoughts. >> is not a governing document a political document to set up for the 2024 election and it's in his best interest that none of this gets implemented because of it to get up limited as steve said it would destroy the economy and certainly bring the republicans back into power. this is a document that makes absolutely no sense. the only thing it was a positive if they got the taxes through then jerome powell can stop raising interest rates because the taxes would destroy the economy, not only bring down inflation but reduce demand and fully enter bring inflation double bring the entire economy down. maria: will keep a spotlight on it, great to see you both. maria: we will talk soon new warnings for the economy from wall street forecaster
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maria: welcome back take a look at where markets ended a volatile week after the jobs report on friday and jay powell's comments that rates could go higher for longer. economist and author of mega threats ten dangerous trends that imperil our future and how to survive them they have warned that markets this year are going to get hit with what he is calling a perfect storm. recession a debt crisis and out of control inflation. he joins me now. it's wonderful to have you this weekend, thanks so much for being here. walk us through the perfect storm that you are expecting. >> the nature of economic monetary and financial risk has changed in the last two or three years. a couple of years ago we were worried about inflation and deflation never worried about inflation. a couple of years ago we were worried about too much savings
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not enough and demand stagnation now we have to worry about stagflation recession and inflation pretty couple of years ago we were worried interest rates are too low now the rising because of inflation and with large stocks of private and public eventually that may become unsustainable, were worried about hyper globalization now we have to worry about the globalization of global supply chains and fragmentation and protection. a couple of years ago we were worried about asset credit bubble and asset prices and now it's a beginning of a bust and a crush and there will be more of it even the economic monetary and financial risk are different for what we had two or three is ago. >> you think the catalyst here is a federal reserve raising interest rates. we are about a year when the fed started this process of raising interest rates the fed started on march 17 the year ago raising
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rates by 25 basis points we have several more meetings and we heard jay powell on capitol hill suggest that we get to see many more rate hikes to come anyway look at 50 basis points versus 25 basis points for the next one how we felt the real true impact of the string of rate hikes yet? >> not yet we have long and valuable logs it takes 12 - 18 months until you reach the impact of the policy on economic activity and they start to solve but not enough unfortunately feel the fed will have to raise rates at least by 50 basis points next time around and push the fed funds rates to at least 6% previous that they thought they could stop it by 25. the problem with the interest rates as high you can have a significant correction further and equity markets bond yields
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are good to go higher, sprinter going to go higher so you have financial distress in the silicon valley bank is an example of the bond portfolios that you obtain were years yields are higher and the price is lower but that's also going to because a hard landing of the economy in its going to make their defaults in the private sector larger and greater economic contraction so that you will feed on each other. either we fight inflation and cause a hard landing in a financial crush were we don't do that and we blink and inflation expectation in the wage and price becomes worse and like the 70s with inflation and recession and stagflation. unfortunately the damage has already been done by decades of mistaken economic policies on the monitor in the fiscal and otherwise facing a hard landing or facing inflation.
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>> the higher rates made everything that much worse. were talking about the president's budget this weekend and what did the committee for responsible budget tell us we are going to see interest payments of $10 trillion. just interest payments on the debt that we hold because of higher rates. you are expecting the stock market to react to this. are you expecting a significant selloff in stocks in d.c. anywhere to hide. if i'm an investor and fully invested, what do i do? >> hopefully there will be a compromise on the budget because if it's not we're going to have a looming crisis on the debt ceiling and that would be terrible for the markets. my main worry inflation is good to be higher than otherwise because you have wage inflation yet the service sector.
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if that happens for markets, the shares would be like last year when inflation is high and rising equities of course are hurt because of the dividends in the bond yields are higher but higher bond yields imply lower price on bonds so any 60 - 40 per folio if you do well on equities and bonds and vice versa that drives inflation lot but when it's rising you lose money on the equity side of the portfolio and you lose money on the bond side of your approval you, what happened last year we saw losses on equities and bonds in my view is likely to continue here. maria: were talk about some of the worst weeks for markets since september in terms of the volatility that we saw this week because of jay powell's commentary what is the most important factor that we need to look for as the market reacts to the slowing economy.
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>> we certainly have to see whether inflation is going to fall or not because otherwise the fed will have to keep i rates. importantly i think commodity markets are going to remain tight for geopolitical reasons and labor costs are good keep on raising and that can increase wage inflation and service inflation. the key thing we have to keep in mind is geopolitics of russian invasion of ukraine where the spring is good get worse it could lead to other shorts of energy market and fertilizer prices and the fact that china reopened is going to increase the demand for commodities in the looming price by the market more than 50% that this year they're going to strike iran iran is the threshold nuclear state there on the verge of adding enough uranium to build a
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bomb and islam cannot wait. maria: always a pleasure to see you. thank you so much. new challenges ahead of th ♪ my relationship with my credit cards wasn't good. i got into debt in college and, no matter how much i paid, it followed me everywhere. between the high interest, the fees... i felt trapped. debt, debt, debt. so i broke up with my credit card debt and consolidated it into a low-rate personal loan from sofi. i finally feel like a grown-up. break up with bad credit card debt. get a personal loan with no fees, low fixed rates, and borrow up to $100k. go to to view your rate. sofi. get your money right. ♪
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>> welcome back big challenges for homebuyers as were weeks away from the most important season for the industry the homebuying spring season, prices are declining the atlantic federal reserve says housing portability is at the lowest level more than a decade as of december average american household would have to spend 42.9% of the total income to afford a median priced home the chairman president and ceo jointly now to assess. it is great to see you thank you
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very much for joining us. >> happy to be here. >> how would you assess the housing market today, i know it's bifurcated depending on what you are and what kind of price home you're talking about have you seen a change when rates started rising and serious demand destruction when rates went all the way up to close to 7%. >> absolutely there's been a lot of movement when rates went from 3% to 6% and up to 7% last year there's no question the boom we've experienced up and dramatically. since september, november up to january january and february have been outstanding and strong not like the boom of 20 and 21.
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>> 20 expecting as most people expect an economy to slow down we saw the jobs numbers this weekend and expectation in a slowdown in economic growth this housing follow suit. >> i think housing is going to be the steady force if you ask me six months ago i would say we are in for a bad difficult recession, i believe in the soft landing theory that's what were feeling were seeing our cost level which is good decrease that will be good for inflation, home prices are holding steady after rising a lot over the last three years that could be good for inflation and a good we are seeing sales happen in a very solid way and feeling more optimistic than i was six months ago is a supply of new homes and
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stock and dropping what about the supply how does that play into things. >> everything is about supply versus demand in the new homefront and we have a built as much and very important resale supply is down to historic lows, normally you can find 2.1 million homes for sale around the country at any one point time. that is normal right now 870,000 available. less than half of normal and that's very helpful for the balance of demand and supply. >> have home prices, obviously they come off the highs. >> yes, absolutely they came off of the highs starting around june of last year. interestingly around january we started to see more strength and
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about a third of our communities across the country we actually bumped up prices modestly but that's a big change from the trend that we had been seen for a few months. maria: would you say is the federal reserve continues to raise interest rates it will impact the housing market negatively? >> the fed is talking about short-term rates, what is important for our business or long-term rates specifically the mortgage rates which are based on the ten year treasuries hopefully if everyone is comfortable that inflation gets under control long-term rates will stay steady. it's important to step back we've been spoiled by 3% rates they are not normal. when i started in the business early on in my career in 1981 mortgage rates were 18% as many home started then, as they are
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right now pre-people adjust their expectations they may not be able to buy at 3000 square-foot home with all the fancy finishes if they need housing they need housing, the 3000 may get adjusted down to a smaller 2500 square-foot home and maybe the granite countertops go down a notch the people adjust the expectation. that's what we've seen as rates go up and down and you see it on the building process, thank you only at vanguard, you're more than just an investor you're an owner. that means that your goals are ours too. and vanguard retirement tools and advice can help you get there. that's the value of ownership. when aspen dental told me that my dentures were ready,
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dad, we got this. we got this. we got this. we got this. life is for living. we got this. let's partner for all of it. edward jones maria: will come back one thing you need to know ahead of next week saturday night may be the last time we set our clocks ahead for daylight savings time senator marco rubio gets his way he is reintroducing his sunshine
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protection act which would make daylight savings time permanent pointing to studies that show the change could have a number of positive effects on the economy in crime and our health including a reduction in car accidents, heart attacks and depression. the senate unanimously passed the bill last year but nancy pelosi never brought the legislation up for vote in the house, maybe this year we will be springing forward or good. we will watch that, don't forget to set your clocks forward. i will see you at 10:00 a.m. sunday morning on the fox news channel for friday morning features exclusive interviews with house speaker kevin mccarthy and has oversight james, south dakota governor kristi noem and i'll be speaking with the florida governor ron desantis. we will get into a live sunday 10:00 a.m. eastern. that will do it for us for now, thank you so much fo i will see you again next time have a great rest of the weekend.


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