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A Brief History of Stock Market Crashes
Stock market crashes have punctuated economic history with sudden downturns that reshape public confidence, policy decisions, and financial systems. From the Great Depression to the 2008 financial crisis, these events have not only disrupted global economies but also exposed systemic vulnerabilities and sparked reforms. As markets face ongoing volatility and new risks, understanding the history of stock market crashes—and the factors behind them—is vital for investors, policymakers, and the general public. This topic offers journalists compelling opportunities to explore financial history, economic psychology, and risk management. Key story angles include: The Great Depression (1929): Analyzing the causes of the most infamous crash in history and its lasting impact on global economic policy. Black Monday (1987): Investigating the role of computerized trading and investor panic in one of the largest one-day percentage drops in stock market history. Dot-Com Bubble (2000): Exploring how tech speculation and investor overconfidence led to the collapse of early internet startups. The 2008 Global Financial Crisis: Examining the role of housing market speculation, subprime lending, and financial deregulation in triggering a global recession. Behavioral Economics and Market Psychology: Understanding how fear, speculation, and herd behavior contribute to market volatility. Are We Due for Another Crash? Looking at current economic indicators, tech valuations, interest rates, and global tensions that could signal future instability. With markets continuing to respond to global events and economic shifts, revisiting the history of crashes offers valuable insights into how financial systems react under pressure—and how societies can better prepare for what comes next. Connect with an expert about the History of Stock Market Crashes: To search our full list of experts visit www.expertfile.com
Data Analysis: Commercial Real Estate Troubles Threaten U.S. Banks
The U.S. banking system is on a precipice as exposures to commercial real estate grow and banks grapple with high interest rates, according to an analysis by a finance professor at Florida Atlantic University. Of the 158 largest banks, 59 in the country are facing exposures to commercial real estate greater than 300% of their total equity capital, as reported in the fourth quarter 2024 regulatory data and shown by the U.S. Banks’ Exposure to Risk from Commercial Real Estate screener. “Regulators have been putting pressure on banks to reduce their exposures. However, it’s a very difficult thing to do without sending a signal of weakness to the market and creating more problems,” said Rebel A. Cole, Ph.D., Lynn Eminent Scholar Chaired Professor of Finance in FAU’s College of Business. “To get around this, many banks are ‘extending and pretending’ by restructuring their loans.” The U.S. Banks’ Exposure to Risk from Real Estate screener, a part of the Banking Initiative at Florida Atlantic University, measures the risk to exposure from commercial real estate at the 158 largest banks in the country with more than $10 billion in total assets. Using publicly available data released quarterly from the Federal Financial Institutions Examination Council (FFIEC) Central Data Repository, Cole calculates each bank’s total CRE exposure as a percentage of the bank’s total equity. Bank regulators view any ratio over 300% as excess exposure to CRE, which puts the bank at greater risk of failure. Troubled debt restructuring for commercial construction, multifamily, owner-occupied and owner-non-occupied mortgages tripled since 2023. They reached $18 billion in the fourth quarter of 2024, up from $6 billion in Q2 2023, according to data from the FFIEC. While non-owner occupied nonfarm, non-residential accounts for more than half of these amounts, there is also serious deterioration in multifamily and commercial construction loans. “Banks choose to extend these loans, hoping interest rates might drop. While the Fed did cut rates,” Cole said. “If a loan is maturing from five years ago in today’s rate environment, rather than refinance it with today’s terms, they will restructure the loan under the same terms from five years ago for another year. This all depends on interest rates falling, which is not likely to happen this year.” Among banks of any size, 1,788 have total CRE exposures greater than 300%, up from 1,697 in Q3; 1,077 have exposures greater than 400%, up from 971 in Q3; 504 have exposures greater than 500%, up from 426 in Q3; 216 have exposures greater than 600%, up from 166 in Q3. For comparison, the aggregate industry total CRE exposure is 132% of the total, unchanged from the third quarter of 2024. Looking to know more? We can help. Rebel Cole is available to speak with media about commercial real estate and the potential threats to the American banking system, Simply click on his icon now to arrange an interview today.
Drops in the Bank of Canada rate will not solve housing affordability.
Summary: The Bank of Canada’s interest rate cuts won’t resolve Canada’s housing affordability crisis. Factors such as skyrocketing home prices, unaffordable down payments, and stagnant wage growth are other primary challenges to address. A personal example offered by the author shows how the price of her Toronto home surged over 1,000% from 1983 and 2024 while her wages during the same period rose only 142%. While some see this issue as a consequence of Baby Boomers remaining in their homes, it's more nuanced than that. We have systemic barriers in Canada that necessitate targeted policy changes. It’s time to tackle affordability and implement effective solutions. The Bank of Canada met today, to determine interest rates for the last time this year. They announced a drop of .50 basis points. This is part of a broader effort to stimulate economic growth in Canada, which faces challenges, especially a softening labor market and persistent inflation. Why Should You Care? Interest rates determine how affordable our debt will be and what return we can expect on our savings. Since mortgages represent most consumer debt, interest rates directly impact affordable housing costs, making them very newsworthy. However, interest rates only tell part of the story. When the Bank of Canada lowers its rate, it primarily impacts variable-rate mortgages. These are tied directly to the BoC's overnight rate, so a rate cut can reduce the interest costs on these loans. Homeowners with variable rates would likely see a reduction in their payments, with more of their payments going toward principal rather than interest. People without debt and savings (primarily seniors) will see a drop in their investment returns. In contrast, fixed-rate mortgages, which are not directly tied to the BoC's rate, are influenced more by the bond market, particularly the 5-year government bond yield. The current trend in bond yields suggests that fixed mortgage rates could also decrease over time. Let’s pause here and talk about the affordability of houses and how interest rates are not the reason housing is out of reach for most first-time buyers. A walk down memory lane might offer some perspective. I purchased my first home in the fall of 1983 for $63,500 (insert head shake). I was 27 years old, and before you do the math, yes, I am a Baby Boomer. My first serious (so I thought) live-together relationship had just ended, and I was looking for a place to live. I had finished school and had a good full-time job with Bell Canada. A rental would have been preferred, except I had a dog. Someone suggested that I buy a home. I did not know very much about purchasing real estate or homeownership, for that matter. But I was young and willing to learn. I had been working full-time for two and a half years. During my orientation at Bell Canada, my supervisor told me to sign up for their stock option program. She said I would never miss the money or regret signing up for the plan. She was right. When I purchased my home, there was enough money in my stock account for a down payment and closing costs. My interest rate was a terrifying 12.75%, yielding a mortgage payment of just under $670 monthly. The lender deemed this affordable based on my $18,000 annual wage. Life was good. This was in 1983, when the minimum down payment for a home purchase in Canada was typically 10% for most buyers. However, a lower down payment could be possible with mortgage insurance (provided by organizations like Canada Mortgage Housing Corporation (CMHC), which allowed buyers to put down as little as 5%, provided they qualified for insurance. This was commonly available for homes under $150,000, with stricter terms for higher-priced homes. If you had a higher down payment of 25% or more, mortgage insurance wasn't required, and you could avoid extra costs associated with insured mortgages. This was part of broader efforts by the government to make homeownership more accessible, especially amid the high interest rates of the time. So let's do the math. Circa 1983 I first needed to prove that I had saved $3,175 in down payments and $953 in closing costs for $4128. In the 2.5 years I worked at Bell Canada, I saved $4,050 (including Bell Canada’s contribution) in stocks. I also had another $5,000 in my savings account. $9,000 was enough to complete the transaction and leave me with a healthy safety net. Fast forward to 2024 Let’s compare what the same transaction would look like today. Using the annual housing increase cited on the CREA website, the same house would be valued at approximately $700,000 today. Interest rates are much lower today, at 4.24%, yielding a mortgage payment of $3,545. 1. The down payment rules have changed. For the first $500,000, The minimum down payment is 5%. 5% X 500,000=25,0005\% \times 500,000 = 25,0005% X 500,000 = $25,000 2. The minimum down payment for the portion above $500,000 is 10%. 10% X (700,000−500,000) = 20,00010\% \times (700,000 - 500,000) = 20,00010% X (700,000−500,000) = $20,000 3. Total minimum down payment: 25,000+20,000 =4 5,00025,000 + 20,000 = 45,00025,000+20,000 = $45,000 Thus, the minimum down payment for a $700,000 home is $45,000. Here is the comparison: 1983 Scenario 2024 Scenario Variance Purchase Price: $63,500 $700,000 up 1002% Down Payment: $3,175 $45,000 up 1317% Loan Amount: $60,325 $655,000 up 986% Interest Rate: 12.75% 4.24% down 200% Monthly Mortgage Payment: $670 $3,545 up 429% Wage: $18,000 $43,500 up 142% Gross Debt Service Ratio: 44.6% 97.8% up 119% Time to Save for Down payment: 2 years 12.4 years up 520% *Please note that this example does not include mortgage insurance The real problem As you can see, housing was much more affordable for me in 1983 and far from cheap in 2024. During the past 41 years, wages have increased by 142%, yet interest rates have dropped by 200%. But the most significant impact on affordability has been the over 1,000% increase in housing prices. So why is all the focus on interest rates? At the risk of oversimplifying a complicated issue, I believe the media often uses interest rates as a "shiny penny" to capture attention, diverting focus from deeper housing affordability issues. This keeps the spotlight on inflation and monetary policy, aligning with economic agendas while ignoring systemic problems like down payment barriers and the shortage of affordable homes. Indeed, a movement in interest rates often has an immediate and noticeable impact on borrowers' affordability, making it a hot topic for news and policymakers. However, the frequency and consistency of the Bank of Canada meetings on interest rates give the impression that rates are the primary issue, even though they are just one part of a complex system. For example, even if the Bank of Canada dropped interest rates below zero, it would do little to solve today’s homeownership affordability issue. The real problems: 1. Down Payment Challenges: With housing prices skyrocketing, the 5%- 20% down payment required has become insurmountable for many, particularly younger buyers. High rents, stagnant wage growth relative to home prices, and rising living costs make saving nearly impossible. 2. Lack of Affordable Starter Homes: Due to profitability and zoning restrictions, housing developments often prioritize larger, higher-margin homes or luxury condos over affordable single-family starter homes. 3. Misplaced Generational Blame: Blaming Baby Boomers for "holding onto homes" oversimplifies the issue. They are staying put due to limited downsizing options, emotional attachments, or the need for housing stability in retirement, not a desire to thwart younger generations. 4. Political Challenges: Addressing structural issues like zoning reform or incentivizing affordable housing construction requires political will and collaboration, which can be slow and contentious. A broader lens is needed to understand and address the actual barriers to home ownership. Interest drops are merely a band-aid solution that misses the central issue of saving a down payment. The suggestion that we have an intergenerational issue needs to be revised. The fact that Baby Boomers are holding on to their homes should not surprise anyone. However, Real Estate models that predicted copious numbers of Baby Boomers selling their homes to downsize got it wrong. Downsizing was a concept conceived in the 1980s. Unfortunately, it did not account for record-setting home price increases or inflation, leaving it undesirable for today’s seniors. Although this is a complex issue, a few suggested solutions are worth exploring. What can be done? Focus on Policy Innovations: To create housing, increase supply, curb speculative investments, and provide targeted assistance for builders to build modest starter homes. To create rentals, homeowners should also receive income tax incentives to build Accessory Dwelling Units (ADUs). These could be used as affordable rentals or to house caregivers for senior homeowners. Today, The federal government announced a doubling of its Secondary Suite Loan Program, initially unveiled in the April 2024 budget. This is a massive step in the right direction. To create down payments, adopt a policy allowing first-time home buyers to avoid paying tax on their first $250,000 of income. Then, they could use the tax savings as a down payment. Focus on Education and Advocacy: Include a warning that helps consumers understand that withdrawing from RSPs results in a significant loss of compound interest related to withdrawals and how this can harm income during retirement. Encourage early inheritance to create gifted down payments. Normalize the concept by emphasizing the benefits to the giver and the receiver. Educate the public on using financial equity safely and create down payments as an early inheritance for their heirs. This will shift the conversation and initiate an intergenerational transfer of wealth that empowers the next generation to own a home. The Bottom Line While the Bank of Canada interest rate cut may ease some financial strain for homeowners with variable-rate mortgages, it will do little to address the core issue of housing affordability. The media's fixation on interest rates as a "shiny penny" distracts from more profound systemic barriers, such as the inability to save for a down payment and the lack of affordable housing stock. These challenges require targeted policies, structural reforms, and intergenerational collaboration to be tackled effectively. The focus must shift from short-term rate adjustments to long-term solutions that prioritize accessibility and affordability in housing. Without meaningful action, homeownership will remain out of reach for many, perpetuating the cycle of financial inequity across generations. Dont't Retire... Re-Wire! Sue
Covering the new Trump Administration - We can Help
With each day seems to come an new appointee to cabinet or significant role, a new policy twist and even the occasional walk back or withdrawal. The steps leading up to January 20, 2025 when Donald Trump resumes office as President of the United States will be getting a lot of coverage - and UC Irvine has it's own team of experts ready to lend their experience, perspective and expert opinion on what is happening. Louis DeSipio examines how democratic nations incorporate new members, including policymaking in the areas of immigration. Topics of Expertise: Foreign Affairs / NATO Immigration and Deportation Department of Education, EPA, Homeland Security, Department of Interior, NOAA, HHS and FDA Jeffrey Wasserstrom specializes in modern Chinese cultural history & world history, who has written on many contemporary as well as historical issues. Topics of Expertise: Foreign Affairs / NATO Free Speech Department of Education, EPA, Homeland Security, Department of Interior, NOAA, HHS and FDA Eric Swanson is an expert on inflation, recessions and what changes in interest rates mean for the economy. Topics of Expertise: Foreign Affairs / NATO Tariffs Impact of Downsized Government Senior's Health and Social Security Heidi Hardt is an expert on NATO, defense, security, foreign policy, organizations, the EU, UN, operations, gender, climate and change. Topics of Expertise: Foreign Affairs / NATO Climate Change Gender and LGBTQ+ Rights Tony Smith’s knowledge of politics includes Constitutional Law, the U.S. Supreme Court and election law. Topics of Expertise: Free Speech Department of Education, EPA, Homeland Security, Department of Interior, NOAA, HHS and FDA Jon Gould is a distinguished scholar in justice policy, social change and government reform. Topics of Expertise: Deregulation Gender and LGBTQ+ Rights All of these experts are available to speak with media - simply click on a profile now to arrange an interview time today.
Does Donald Trump Like Seniors?
At 78, Donald J. Trump already has 13 years of experience as a senior citizen. During his previous presidency, he occasionally referenced his senior status, particularly when discussing issues affecting older Americans. For example, in the 2020 election campaign, he acknowledged his age and addressed fellow seniors directly in his messaging, sometimes referring to himself as part of the senior community. Looking at his record, Trump appears to have a complex relationship with seniors. While expressing support for essential programs such as Social Security and Medicare, he often weaves the needs of seniors into his rhetoric. Yet some of his policy decisions have created mixed feelings among older Americans and advocacy groups. While pledging to protect these programs, he’s considered budget-cut proposals to reduce the funding of both these programs. Plus, his administration attempted to repeal the Affordable Care Act. While even the smartest of experts have learned it’s difficult to predict what Donald Trump will do on key policy decisions, there are some clues as to how his move back into the Oval Office will impact Canada and, more specifically, seniors. This topic got me wondering. Does Trump (a senior himself), like seniors? Let’s look closer at this demographic. Everyone knows that older people are the most reliable voters. The stats are compelling. According to Elections Canada - 75% of Canadians aged 65-74 voted compared to 48% of those aged 18-24. - The statistics for our US neighbours are similar, with 70% of Americans aged 65+ voting and 50% of Americans aged 18-29 voting. Knowing this voting power of the senior demographic, did Trump pander to this voting cohort? Yes, he most certainly did. He knew that as people age, their concerns narrow to a smaller list of critical topics such as Financial Security, Health, and Safety. During his 2024 presidential campaign, Donald Trump focused heavily on appealing to older voters, who historically make up a significant portion of the electorate and are more likely to vote. His campaign emphasized economic stability, protecting Social Security and Medicare, and national security—particularly relevant to older demographics. Let’s take a closer look at how the Trump administration could impact Canada's senior demographic in the following areas: Inflation Background: Inflation has a direct correlation to the cost of living. As the prices of goods and services rise over time, the purchasing power of money decreases – a challenge for many seniors. Critical expenses like housing, healthcare, food, and utilities could increase noticeably, putting pressure on limited retirement incomes and pensions. All this is stressful. According to a 2024 national survey of over 2,000 Canadians (conducted by Leger on behalf of FP Canada), money remains the top stressor for Canadians, with 44 percent citing money as their primary concern; That's up from 40 percent in 2023 and 38 percent in both 2022 and 2021. What This Means: Two of Trump’s biggest promises in his campaign (mass deportation of undocumented immigrants and more restrictive trade regulations) would have a "significant impact," according to an article by Ellen Cushing in the Atlantic. A domestic labour shortage plus double-digit import taxes would raise food prices on both sides of the border. Cushing goes on to say that “deporting undocumented immigrants would reduce the number of workers who pick crops by 40-50%.” While this rhetoric may have played well during the campaign, you can't fake the simple math here. Fewer workers means higher wages. That means higher prices. And the senior demographic will be hit hard because of their fixed incomes. Many will eat less of the expensive grocery store items like fresh meat, fruits and vegetables to make ends meet. Food prices will inevitably climb with these policies. The only question is when. According to a new poll conducted for CIBC and Financial Planning Canada on November 27, 2023, approximately 75% of working Canadians still need a formal financial plan for retirement. And many retirees face economic difficulties. A whopping 25% are still carrying debt into retirement. Many also report they have a substantial portion of debt and report that their retirement lifestyle isn't as comfortable as expected. The impact of inflation could be dire with few solutions; it is different for these older Canadians because they cannot re-enter the workforce. The only saving grace is that many of the hardest-hit Canadians are homeowners with equity options. Interest Rates Prediction: According to Beata Caranci, SVP & Chief Economist of TD Bank, the US is likely to raise interest rates to control growth. Canada is also expected to increase its rates, mainly to keep the Canadian dollar stable against the U.S. dollar. The Bank of Canada could be forced to rescind the projected planned interest rate reductions or at least reduce them. However, it's a delicate balancing act. Our economy could suffer if we don’t mirror the US increases in interest rates. Impact: Increasing Canadian interest rates will impact seniors by increasing mortgage carrying costs. At the same time, older Canadians with investment savings could see increased returns on these savings. A rise in interest rates would also impact housing prices and foreign exchange rates. House Prices Background: Economic, demographic, and policy-related factors influence home prices in Canada. The new Trump administration will undoubtedly impact these factors. To understand this area, let's examine some significant variables affecting housing costs. 1. Supply and Demand When housing supply is limited, and demand is high, prices rise. Conversely, when supply exceeds demand, prices stagnate or fall. Should the new administration adopt more restrictive immigration policies in the US, Canada might see an increased influx of skilled workers and families seeking an alternative place to live. Housing demand will likely increase in major Canadian cities—Toronto, Vancouver, and Calgary- resulting in price increases. 2. Population Growth An increase in population or immigration boosts housing demand, particularly in urban centers, consequently increasing home prices. Canada welcomed 485,000 immigrants in 2024, many of whom settled in cities like Toronto and Vancouver. This influx has driven up demand for housing, contributing to price increases. The Canadian government has recently reduced the number of immigrants we allow into our country, dropping the number from 500,000 to 395,000 in 2025. Current immigration numbers plus any overflow from the US should keep demand buoyant and we could see home prices continue to rise. However, Canada needs more housing, especially in high-demand urban areas. In addition to immigration, slow construction timelines and zoning restrictions are contributing factors. Canada's ongoing housing shortage and the potential impacts of Donald Trump's election win in the U.S. could exert upward pressure on home prices, particularly in major cities like Toronto and Vancouver. These cities, already grappling with limited housing and high prices, will likely see further price increases due to increased demand. Without robust policy interventions to increase the housing supply, Canada’s housing prices, particularly in major centers, will likely continue rising. And there will be winners and losers here. This is great news for seniors wishing to sell and exit the market by finding other living arrangements, such as renting, moving in with family, or entering retirement homes. It is even better news for seniors wishing to age in place as they will have more equity to fund their retirement. But it’s disappointing news for those wishing to downsize and stay in the same communities. They may be able to sell high, but they could also be forced to buy high. 3. Foreign Currency Trump's policies, such as tax cuts and protectionist trade measures, have historically strengthened the U.S. dollar. If similar policies are reintroduced, the U.S. dollar could become more robust due to increased investor confidence and perceived economic growth in the U.S. That’s bad for Canadians traveling or living in the U.S. Trump's potential trade disputes, particularly with China, and his aggressive geopolitical stance could also create uncertainty in global markets. While this might temporarily strengthen the U.S. dollar as a haven, long-term concerns about trade wars and deficits could cause fluctuations, impacting the Canadian dollar's stability against the U.S. dollar. This volatility directly impacts Canadians, especially those with significant financial exposure to the U.S. dollar. A second Trump presidency will likely impact the exchange rate between Canadian and U.S. dollars, which is especially relevant for 85% of Canadian Snowbirds, who, according to Snowbird Advisor, spend winters in the United States. This number was estimated to be 900,000 in 2023. These seniors may face increased expenses for property taxes, utilities, and other daily living costs in the U.S. If exchange rate volatility persists, locking in more favourable rates or using specialized currency exchange services, US credit/debit cards with lower transaction fees, and using US dollar accounts might be wise - especially for more significant financial transactions. The Bottom Line One thing is certain. Trump's second term has the potential to impact many Canadian seniors if he implements the policies he discussed during his election campaign. While some could benefit financially from higher home equity and investment returns, many may need help with increased living costs, especially food and foreign exchange challenges, particularly Snowbirds and those on fixed incomes. While we are all watching this situation unfold, one thing is sure. It's difficult to predict if Trump’s second term will make Canadian or US seniors "great again."
NATO, Russia and a New Approach to Foreign Policy
The election of Donald Trump for a second time as the President of the United States may have come as a surprise to many, for world leaders it means an immediate shift when it comes to global issues. Trump campaigned on dealing with the war between Russia and Ukraine and the wars Israel is fighting on multiple fronts himself, and resolving these delicate and complex conflicts with little regard to those at NATO or other leaders around the world. Trump has also indicated that serious changes will be coming to how America handles trade -which will also put how his administration deals with President Xi Jinping in China and the newly elected President of Mexico, Claudia Sheinbaum in the spotlight on center stage. There is already a lot of speculation an even a few glimpses at what lies ahead for US foreign policy, and if you're a reporter covering the lead up to this much hyped event - then let our experts help with your coverage. Louis DeSipio examines how democratic nations incorporate new members, including policymaking in the areas of immigration. Jeffrey Wasserstrom specializes in modern Chinese cultural history & world history, who has written on many contemporary as well as historical issues. Eric Swanson is an expert on inflation, recessions and what changes in interest rates mean for the economy. Heidi Hardt is an expert on NATO, defense, security, foreign policy, organizations, the EU, UN, operations, gender, climate and change. Tony, Jeffrey, Eric and Heidi are available to speak with media - simply click on either expert's icon now to arrange an interview today.
How Will Rate Cuts Affect the Election?
On September 18, the Federal Reserve established the first interest rate cut since the Covid pandemic in 2020. The Fed lowered the federal funds rate by half a percentage point – a much larger change than the typical quarter percentage point cut. Dr. Jeff Haymond, dean of the Robert W. Plaster School of Business at Cedarville University, shared insight about the motivations behind this rate cut in a recent interview. Here are some key points: The United States' national debt has been described as a "ticking time bomb." What impact will this and future interest rate cuts have on the national debt? In light of this recent move, current presidential candidate Donald Trump has articulated his economic plan to put a cap on credit card interest rates. Would this bring down the cost of living in the United States, or will it lead to less options for the consumer? This slashing of the interest rate comes only a short time before the presidential election, with many claiming that this cut was, in fact, a political move. Will it affect the decisions of voters as the election draws near? If you are covering the recent interest rate cut or potential for future cuts and need to know more, let us help with your questions and stories. Dr. Jeff Haymond is an expert on this subject and is available to speak to media regarding the action of the Federal Reserve and what this means for families in the United States – simply click on his icon or email mweinstein@cedarville.edu to arrange an interview.
Covering the Fed's Interest Rate Decision? Our Expert can Help
The Federal Open Market Committee has three meetings left in 2024 and markets expect interest rates to be cut. This could have a serious impact on the economy as inflation trends downward and restrictive monetary policies are now ready to be loosened. There will be a lot of media attention and speculation around the September 18 decision and its anticipated effects on the global economy. It's why experts like Florida Atlantic's William Luther are ready to help with any questions or coverage. William J. Luther, Ph.D., is an associate professor of economics at Florida Atlantic University, director of the American Institute for Economic Research’s Sound Money Project, and an adjunct scholar with the Cato Institute’s Center for Monetary and Financial Alternatives. The Social Science Research Network currently ranks him in the top five percent of business authors. *** Recent Media: Fox News: GOBankingRates: Newsweek: William Luther, Ph.D., an assistant professor in FAU’s Economics Department, has expertise in economic growth, monetary policies, business cycles and cryptocurrencies. Luther’s research has obtained media interest across the nation, including recent coverage by The Wall Street Journal, Politico and Florida Trend. If you're looking to know more - let us help. Simply click on William's icon now to set up an interview today.
Is Florida becoming more affordable for renters?
Between high interest rates, an influx of newcomers eager for housing and inflation taking a toll on the cost of almost everything - it's been an expensive year for anyone living in Florida. But it appears the tide might be finally turning on high costs and the price to rent a place in the Sunshine State might be going down. It's a trend that has media looking for answers and experts like Florida Atlantic's Ken Johnson getting calls to provide his insight, opinion and expertise on the topic. Florida Atlantic University recently released a new study showing that the state’s rental markets might be stabilizing. In the release, FAU officials announced that rents in areas like Palm Bay and Jacksonville have recently gone below their long-term pricing trends. Meanwhile, the data indicates that other major cities in the state — such as Cape Coral, Orlando and Deltona — saw only slight increases in rent prices, with price increases gradually slowing down. As such, it could be a sign that many renters statewide could soon see lower prices. “While these measures are small, they are a positive sign of where the rental market could be heading in the future,” said Dr. Ken Johnson, a real estate economist with FAU’s College of Business. “These Florida cities are renting at a discount compared to their historical averages, and others appear to be heading in that direction, suggesting that rental markets around the state are stabilizing.” June 06 - Click Orlando.com Florida may be an interesting case study on what lies ahead. Will these rental trends in Florida start to appear nationally? Who will best benefit from lower rents and what will it mean for the economy? Will lower rents attract more people to Florida and could that reverse this trend? There's a lot to know and understand about the rental market. And if you're a journalist covering the topic or looking to know more - then let us help. Ken H. Johnson, Ph.D., an economist and associate dean in FAU’s College of Business, is available to speak to the media. Simply click on his icon to arrange an interview and time.
Ask the expert: 2024 economic outlook
Although the economy has improved since the COVID-19 pandemic, inflation has been a challenge for many Americans throughout 2023 and the economy remains a top issue ahead of the 2024 election. Experts are already making predictions about interest rates, inflation and the market for next year. Antonio Doblas Madrid is an associate professor in the Department of Economics in Michigan State University’s College of Social Science. He reflects on the economy this past year and answers questions about what you can anticipate about the economy in 2024. What are a few of the most memorable economic events of 2023? The economy in 2023 reminds me of Rocky Balboa, the boxer with a strong chin from the Rocky films who, despite getting hit over and over, keeps moving forward. A year ago, the consensus prediction among investors and professional forecasters was slower growth and higher unemployment. Inflation was still above 6%, the Federal Reserve increased interest rates to one of the highest rates in 40 years, and the stock market ended 2022 in the red. Many observers said a ‘soft landing’ was a pipe dream and a recession inevitable. The year 2023 brought its own set of challenges. To name a few, a debt ceiling standoff started in January and continued until May, bringing the government dizzyingly close to default and causing a ratings downgrade. In March, the failure of Silicon Valley Bank started a crisis that, had it not been contained by a historic expansion of deposit guarantees, would have spread through the system and taken down the economy. A war broke out in Gaza. A large-scale auto workers strike temporarily shut down large parts of the sector. And the economy of China, a major trading partner, decelerated. Given all this, it is remarkable how good the numbers look right now. Inflation has steadily fallen to around 3% and is now within striking distance of the 2% target. The most recent gross domestic product, or GDP, report shows a robust 3% year-on-year growth rate, the unemployment rate remains at 3.7%, and the stock market has made a roaring comeback. The numbers look stronger than those of other major advanced economies, such as the eurozone, the United Kingdom, Japan or Canada. However, it is too early for a victory parade. The fight against inflation is not over, monetary policy has long and variable lags and, even in a strong economy, many people are struggling. But, thus far, it is hard to imagine a softer landing than 2023. What’s expected to happen with the economy in 2024? With the usual caveat that even the best predictions have a margin of error, professional forecasters see the economy still growing in 2024, albeit more slowly. The numbers hover around 1.5% for real GDP growth and 4% for the rate of unemployment. This paints a picture of moderate growth, and a labor market that, while no longer crushing records, is still within the range of what can be called full employment. What’s predicted to happen with inflation? Forecasters and market-based measures of expectations both predict that inflation is likely to continue falling gradually in 2024, to about 2.5%. Thus, the inflation shock that hit the economy is expected to continue fading, although it may take some time to go that last mile from 3% to 2%. The Fed also appears to be quite optimistic on inflation, given its latest forward guidance. What will happen with interest rates in the new year? The Fed expects inflation to fall quickly, so quickly, in fact, that it has started to reverse the hawkish policy of the last two years in its forward guidance. This means that, although the Fed has not lowered interest rates yet, it has started talking about the possibility of rate cuts — three of them — in 2024. With the economy still at full employment, this clearly means that the Fed is expecting inflation to continue to fall. How could the presidential election affect the economy? There is a popular belief that election uncertainty is detrimental to the economy, but we do not really see that in the GDP data. Growth rates in presidential election years are not lower than average. On average over the last few decades, there is a small negative effect on the stock market in election years, but it disappears in the 12 months following the election, regardless of which party is elected. What economic words of wisdom can you share for 2024? It seems to me that the perception of the economy is worse than the reality. So, I would recommend stepping away from the noise and looking at the data for some objective measures. As far as saving for retirement goes, I think mainstream financial advice is solid. So, listen to your financial advisor if you have one. If you don’t, that’s okay, it is not that hard. There are many free tools, like retirement calculators, to help you figure out how much to set aside monthly. Take advantage of employer-provided and tax incentives. Invest mostly in stocks when young, gradually switching to fixed income as you age. For equities, follow a passive strategy. Buy and hold index funds. Do not try to pick stocks or time the market. If you are at the fixed-income stage, you may want to open a high-interest CD to lock in a high rate before the Fed starts cutting rates again. Finally, set up your contributions automatically draw, stop thinking about money for a few months and invest instead in nonfinancial assets, like relationships and health. Looking to know more about the economic outlook for 2024 or do you want to connect with Antonio Doblas Madrid? To schedule an interview - simply contact Jack Harrison, Public Relations Coordinator today.
