Consumer Debt Hits New High, Burry Believes in Bank and JP Got Bars

Total consumer debt hit a fresh new high in the first quarter of 2023, pushing past $17 trillion even amid a sharp pullback in home borrowing. According to a report from the New York Federal Reserve, the total for borrowing across all categories hit $17.05 trillion, an increase of nearly $150 billion, or 0.9% during the January-to-March period. That took total indebtedness up about $2.9 trillion from the pre-Covid period ending in 2019.

In this episode of The Higher Standard, Chris and Saied examine this news and determine the effect it will have on the economy as a whole.

They discuss news that famed short-seller Michael Burry and his hedge fund, Scion Asset Management, snapped up 150,000 shares of First Republic prior to its purchase by JP Morgan, worth about $2 million at the end of the first quarter.

Chris and Saied look at A Gallup poll indicating that 36% of US adults say they have a “great deal” or a “fair amount” of confidence that the Federal Reserve chairman would do or recommend the right thing for the economy, a precipitous drop which is now at or below his predecessors’ as the central bank wages its war against inflation.⁣

They also offer some thoughts on recently-released Federal Reserve data, showing that deposits at U.S. banks climbed to $17.16 trillion in the week ended May 3, up about $67 billion, ticking up from the lowest level in nearly two years while bank lending was little changed at a record level.

Join Chris and Saied for this fascinating and informative conversation.

Enjoy!

What You’ll Learn in this Show:

Why inflaton in Argentina has sped up to 109% as currency weakens before the election.
The three steps to a Federal Reserve pivot.
Why Warren Buffett and Michael Burry are doubling down in the banking sector.
Why the FOMC needs to see inflation going down on a fast enough trend.
And so much more...

Resources:

"With $1B in back rent due, LA landlords struggle to survive" (The RealDeal via Instagram)

"Consumer debt passes $17 trillion for the first time" (CNBC via Instagram)

"Michael Burry loaded up on bank stocks during the banking crisis" (Bloomberg Business via Instagram)

"Paul Tudor Jones says the Fed is done raising rates, stocks to finish the year higher" (CNBC via Instagram)

"Confidence in Jerome Powell has plunged to a record low" (Bloomberg Business via Instagram)

"What happens when the prophecy of the blockchain fails?" (Bloomberg Business via Instagram)

"U.S. bank deposits rise in early May, lending little changed at record high" (Reuters)

"US real estate investors are losing money on roughly 1 in 7 homes they sell — among the worst since 2016. And they're most likely to take a hit in these 5 cities" (Moneywise)

"A problem for the housing market: People won’t quit their cheap mortgages" (The Washington Post)

"US Households Show Signs of Stress as New Delinquencies Rise" (Bloomberg)

"Argentina to Hike Rates in Bid to Stem Inflation Crisis" (Bloomberg)