If Rates Spike in the First half of 2022 and Then Roll Over What Does That Mean for US Economy 2023?

Video Closed Captioning:

good morning good afternoon good evening

michael zuber one rental at a time it is

wednesday and yes that means we bring

back the one and only matt the mortgage

guy how you doing buddy i’m doing great

i wore a purple shirt i got a purple

background god we are just we are

aligned brother our brands are in sync

that’s pretty awesome hey uh one thing i

wanted to do is i got a lot of questions

from our conversation last week about

barry habib’s prediction right we we

spent a lot of time talking about barry

habib’s the man he’s won this crystal

ball award multiple times

he just

very good at what he does and then we

talked about his prediction which was

hey rates are going to go up in the

short term but they’re ultimately going

to roll over and go down and then we

kind of ended the interview people are

like well what does that mean so i

thought maybe

we should break it down a little bit for

people and i don’t know has barry

changed his opinion at all no and you

know that uh

came out i think me and you add a little

bit of our own color to it maybe rates

go up a little bit higher a little bit

faster and so when they when they

retract if and when they do it’s to a

higher point than than maybe he had

predicted i think you know for quick

recap for anybody you know we talked

about um all the stuff that the fed’s

gonna do currently and they’ve already

talked about you know tapering and and

once they’re done tapering

actually hiking up the fed funds rate

rates go up and what barry was saying we

talked about previously is once uh

you know measures are put in place to

fight inflation and inflation comes down


then we’re gonna see

mortgage rates

go back down and uh you know i i don’t

recall what it was like offhand

specifically but you know he was talking

about rates going up to 3.75 but then

maybe towards the end of 22 coming back

down to three yeah and that’s and that’s

the key that i want to talk about

because again i don’t agree with them

but again he’s got the awards i don’t he

does this for a living i don’t so you

know hey

i’m gonna go i’m gonna go with him

so so to me though right so the fed does

its thing it does its little happy dance

rates get all the way up to 3.75 and

then they roll over

and they get back down to three to me

that’s a fast turnaround right we’re

talking about 11 and a half months

and again i was trying to think you know

based on the questions where i’m like

well what would really cause that well i

think the only answer is

i don’t know if it’s an official

recession meaning two negative quarters

but it certainly means a slowdown of

probably epic proportions i mean that’s


i mean that i mean right today they’re

the mortgage rates like 3.3 or 351 or

something right yeah and over the last

week we’ve seen it

you know go up faster than most people

thought i don’t think anybody predicted

what you know the last week and a half

that would go from three and a quarter

to i think on one of these um

you know

national surveys of rates it’s like 3.64

on a 30 year um and so

you know up faster than most people

thought and so


you know we see

q1 into q2 four percent which i don’t

think is that we’re not that far away

we’re no we’re really not that far away

then uh you know if and when that comes

i think me and you agree that it it

would feel

really fast to see that you know

retraction of rates happen this year

because i agree with you as well we’re

gonna end the year with an inflation

number that’s still four or five percent

i don’t know what your guesstimate was

but i think i’ve listened to enough of

your stuff where

you know we’re not going to go from

seven to two no chance this year no

chance right no um and so so i agree

with that that like if if it plays out

how barry talked about and a humongous

fan of barry followed barry forever i’ve

paid for his advice for years so that

tells you something yeah


you know i see it playing out but maybe

it’s a 24 month or a 30 month window

versus a 12 month yeah that’s that’s

exactly my thing i think i think barry

was on to something just for me at 20

added that in 22 right that full cycle

up and down in in a calendar year just


feels rushed and i’m almost concerned

what it would mean for the broader

economy if that were to happen right

yeah i mean it almost needs to be uh a


you know downturn recession yeah like

return for that stuff to play out right

now that quick yeah that’s that’s what

i’m thinking and again i actually every

wednesday the more as you know the

mortgage backers association puts out

their notes and i just happened to look

at him this morning last week 3.33

this week 3.52 that’s almost a 20 basis

points move

and and you know what mike i think when

they put it out on wednesday they’re

talking about last friday oh geez so

that three point that 3.52 is is is

closer to 3.64 and you know it’s it’s

it’s been

red candle after red candle um

it’s that that’s that’s that’s probably

a whole other topic where you know it’s

going to take consumers a while of me

showing a 3625 and going wait wait no no

i just saw on an advertisement 299.

yeah you saw that three or four weeks

ago and that was paying a point

today’s you know rates you’re you’re in

the mid threes on a prior residence

unless you plan on paying points and

then of course you know the 299 is

always available it’s going to be

available it’s just going to cost you

more yeah pre-paid that’s what that’s uh

again the fact that we talk weekly

the fact that people can go back to your

playlist on my channel and see that we

were talking six weeks ago about like it

locket uh the fact that we were talking


extracting dead equity at three percent

now if you’re gonna do to it it’s much

more costly i just love the fact that we

do this weekly uh i don’t know about you

but i think rates go higher from here so

again you may 3.52 or 3.62 might feel

high i want to remind you that i’ve done

deals north of seven

um so again 3.62 kind of feels okay i

fact just did an office refi at 3.99 so

yeah pretty crazy yeah i mean i think

too the the thing about it is i hear

very often in my seat talking to

consumers day in and day out nah it’s a

little bit high i think i’ll wait yeah

that hasn’t worked out and and and i

just honestly don’t believe it’s going

to you know as much as i

love barry and it might play out over

two or three years and we might see a

retraction if we go to four and a

quarter and then that stuff plays out

and we retract to three and a half

you’re right right back where you

started today and by the way

we might go up and never come back just


anybody who was talking in 2018 and

somebody said i wouldn’t buy now it’s

pretty frothy house prices are high

don’t buy now

we most likely never see 2018 home


ever again right we’re already

40 50 percent above that um in most

markets and even with

a large correction that nobody sees

except for a few youtube channels out


we’re not going back

no i’m not going back

yeah so again this

when i when i look at when i

so again barry’s prediction up and then

down inside of a 12 month period to me

the way we get there is frankly a fed

induced accident meaning gdp contraction

maybe not an official recession because

it’s not two quarters in a row uh but

gdp consumers are hit


yeah that basically that means that

because i think right now powell is

trying to be paul voker he’s trying to

be tough i’m going to beat inflation

give me my job back for four years right

he told he was trying to get confirmed

yesterday or having his

meeting and um

i don’t think he can go back on that i

don’t i don’t think he can be paul

volcker one week and then go be great

greenspan the next week i think that’s a

very bad look yeah i think he’s already

uh had his his uh mistakes and blunders

and yeah calling stuff transitory

he doesn’t want to keep making mistakes

and making headlines for the wrong

reasons yeah exactly exactly so folks if

you saw last week’s episode thank you

for bringing your questions you helped

with this topic uh if you are looking to

buy get qualified perhaps you’re one of

the few left that could refi i’d

strongly suggest matt the mortgage guy

he’s a part of my uh private facebook

group part of the course he’s even

created free content bonus section for

the course how to read a mortgage

statement mortgage proposal things of

that nature how do you want people to

reach out go to greatmortgagebroker.com

we’ve created a simple form makes it

really easy for you just a few quick

questions who you are where you’re at

how we can get a hold of you how we can

help and we’ll be in touch

very shortly very cool man thanks again

yeah thanks mike