Can America Resist a Global Recession? w/Moody’s Mark Zandi

On The Market

BiggerPockets

News, Investing, Business, Education

4.8 • 820 Ratings

🗓️ 3 February 2025

⏱️ 37 minutes

🔗️ Recording | iTunes | RSS

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Summary

With evidence of a global recession piling up, Americans have just one question—will we be affected? So far, everything is going well for the US. Job growth continues, unemployment is low, and asset prices are high, but with the global economy becoming increasingly interlinked, could a crash in Europe or Asia pull us down with them? Mark Zandi, Chief Economist of Moody's Analytics, has a contrarian viewpoint that defies the masses. But Mark has bigger worries than a global recession taking down the US economy. We could be our own worst enemy as “tinder” for an interest rate fire begins to pile up, and the bond market may be more than ready to light it. Even with President Trump’s push for lower interest rates and the Fed pausing rate cuts, could we see mortgage rates fly up higher, defying the system meant to keep them in check? Plus, what does DeepSeek’s entry into the AI race mean for the US economy? Could this cheaper, sleeker AI bring serious competition not only to the US AI market but also to chip manufacturers whose stock prices have been carrying the market to record highs? It’s a lot to unpack, but Mark does a phenomenal job laying it all out. In This Episode We Cover Whether the US’s strong economy could falter during the next global recession DeepSeek’s threat to the US tech market and whether we’re facing another “dot-com bubble” scenario Why interest rates are scarily close to rising again as the bond market gets increasingly frustrated The catalyst for home prices to drop with so many “locked-in” homeowners Are stocks way too overvalued with price-to-earnings ratios at record highs? And So Much More! Links from the Show Join the Future of Real Estate Investing with Fundrise Join BiggerPockets for FREE Find Investor-Friendly Lenders Dave's BiggerPockets Profile On the Market 285 - Bond “Vigilantes” Hold Interest Rates Hostage as Rate Cut Hopes Shrink Mark’s X/Twitter Grab the Book, “Recession-Proof Real Estate Investing” Jump to topic: (00:00) Intro (00:44) An “Exceptional” Economy, But… (04:53) Tariffs Could Cost Us (08:13) Why America is Winning (10:46) Global Recession? (12:44) Massive Interest Rate Risk (20:23) Could Home Prices Fall? (23:30) DeepSeek Changes AI Race Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/on-the-market-292 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [email protected]. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	The U.S. economy is by all measures strong, but is it strong enough to resist a global recession?
0:07.7	That's exactly what we're unpacking today.
0:15.1	As many other international economies struggle, America appears to be holding steady. But with recent news about
0:22.8	deep seek and other foreign market updates, could that be about to change? And if the global
0:28.5	slowdown does finally hit our shores, what does that mean for jobs, for growth, and for your
0:33.8	investments? I'm Dave Meyer, and in today's episode of On the Market, I'm joined by
0:38.1	Mark Zandi, chief economist at Moody's Analytics to break it all down. Let's jump in. Mark
0:45.0	Zandi, welcome back to On the Market. Thanks for joining us. Dave, it's fantastic to be with you.
0:50.4	Thanks for the opportunity. This is a treat for us. We talk a lot about the housing market
0:54.5	on this show, but I'm excited to just talk more broadly about the economy. So maybe, Mark,
1:00.9	we can start there. And you can tell us a little bit about your view of the American economy right now.
1:07.1	Trump just took over second term. How would you describe the economy at this pivotal point in the American society?
1:14.6	Exceptional, at least in the aggregate.
1:17.6	All the numbers look about as good as they get, right?
1:21.6	Strong growth, GDP, jobs, low unemployment.
1:24.6	We've been at 4%-ish for three years, which is just amazing.
1:29.5	Across every demographic, you know, so forth and so on. The one blemish had been inflation,
1:34.5	but that's kind of sort of back in the bottle, and we can talk more about that.
1:38.2	Stock markets at a record high, pretty close, housing values at a record high,
1:43.0	crypto is at a record high. I mean, it's like, you know, I mean, you can at a record high, crypto is at a record high.
1:44.8	I mean, it's like, you know, I mean, you can find issues and problems.
1:49.3	There are definitely things to think about,
	...

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