1871: Mortgage Credit Availability Index Drops! MacroVoices Patrick Ceresna: Long Inflation Cycle

Jul 20, 2022

55:47

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Episode notes

Welcome to today's episode of The Creating Wealth Show where Jason Hartman reminds you that there is an important distinction to make between interest rates, housing affordability and the ability to qualify for a loan based on the usual things, such as credit score and debt-to-income ratio. There's a general overriding concept of credit availability, not directly related to interest rates: this is the willingness of lenders to lend and the ability of borrowers to borrow, measured by the Mortgage Credit Availability Index (MCAI). The credit supply is down, meaning it is now harder to get a mortgage than it used to be.

Jason Hartman welcomes Patrick Ceresna, Founder of Big Picture Trading and host of the MacroVoices Podcast to the show today to talk about the current macroeconomic picture we are facing today. Patrick explains why our inflation problems are not going away anytime soon. The only mechanism which the central banks have to slow an economy is the cost of credit, reflected in interest rate policy. However, the problem in this cycle is that when the inflation is not driven by massive demand, but rather supply issues, then the ability for monetary policy to actually have an impact diminishes.

Key Takeaways:

Jason's editorial

0:00 Welcome Empowered Investors from 189 countries world wide

1:45 Mortgage Credit Availability Index (MCAI)

2:58 The Great Recession, the mortgage meltdown and The Big Short

5:50 Credit supply in a credit based economy

6:30 Empowered Investor Pro - EmpoweredInvestor.com

8:42 Wall Street is the modern version of organized crime

9:52 Regulating the food supply

11:49 Messaging apps and insider trading

14:31 Last week, the Euro reached parity with the dollar

17:40 Downward pressure on the inflationary spiral