SCSU’s Banaian Still Doesn’t Expect a Recession in 2022
The cost of goods and services have been on the rise due to inflation for the past 6 months. King Banaian is the Dean, School of Public Affairs and Economics professor at St. Cloud State. He says with an unemployment rate below 4% and prices rising because people can afford to spend more, he has a hard time believing we're going to have a recession anytime soon. Banaian says it is possible we could see a recession 6 months from now but signs aren't pointing to a recession in the immediate future.
Banaian says largely people still have money after delaying travel during the pandemic and the government stimulus dollars that came in over the past couple of years. He says it is possible the Fed won't raise interest rates more than they have already based on how the market has responded. Banaian says based on this evidence if we go into a recession that it won't be that bad compared to other recessions we've had in the past. He says he certainly doesn't think it will be like the one we had in 2008.
Banaian says home sales could slow with interest rates on home mortgages going up. He says potential buyers just won't qualify to buy as expensive of homes as they were able to prior to the interest rate adjustment. He says if mortgage rates stay in the 6s it may not be so bad for the housing industry. Banaian says there will be some people who will chose now to stay in apartments because of the interest rate increase that prevents them from qualifying for the home they used to qualify to buy.
If you'd like to listen to my conversation with King Banaian it is available below.