Liquidity and credit are the next two big things to watch besides labor.

If labor started to crack and the Fed is raising interest rates, maybe there's another 75 basis points for sure coming at the July meeting. And then there's another meeting by September. That is making credit more expensive.

There's a difference between credit and cash. Cash on hand is cash. Credit is what banks are willing to offer and extend. And if there's less credit out there because it's more expensive or if more expensive credit causes consumers to buy less goods and services that will slow down the economy.

We're also looking for cracks in the credit. Are there credit defaults? Are companies that have taken out credit like corporate bonds, high-yield bonds aka it used to be called junk bonds. Are they starting to default on their debt?

Credit cracking can have ripple effects.

Credit cracks are a little bit different than liquidity, so we're going to keep an eye on credit quality.

Credit and mortgages are fantastic. The loans and the books have some of the best credit ever seen.

The default rates are among the lowest in history and people are still gainfully employed.

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FHFA made a 50 basis point fee inside universal mortgage-backed securities!

This has threatened the fungibility of universal mortgage-backed security.

We used to have different kinds of coupons depending on which GSE was buying the loan. So you had either Fannie coupons or Freddie coupons. You still have Ginnie coupons.

I've said it before that the secondary market is cold, heartless, and unforgiving. And we now have this cold, heartless, unforgiving 50 basis point fee that is inside securities now.

The Russell Index 1000 and 2000 are basically small businesses around America.

Some fall out of that top 1000 and 2000, and the new ones emerge as businesses grow.

There are ETFs out there that have to buy these companies so it's forced buying into these companies.

There's also a growth versus a value Russell Index. Companies like Meta (Facebook), Netflix, PayPal, and Zoom were growth stocks because they're adding users. Now they're value stocks because they're not adding as many users. But now the metric to look at them is revenue per user (RPU).

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Quad witching is different than triple witching.

Options contracts and futures contracts are expiring on the third Friday of every month. That's called quad witching.

Credit makes the world go round and credit depends on liquidity.

Food and energy have continued to rise and putting a real damper on things.

Will housing slow down as a result of it? Has the Fed gotten so far out in front of where the economy is heading? Are we in a recession already or will we be heading into it? Will we skirt it?

We are officially in a bear market. 70% of the time we've gone into a bear market, we have gone into a recession.

There's a $700 a month increase in median home price.

The Biden administration is getting rid of $6 billion in student debt, in addition to the $25 billion they already wiped out.

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The markets have sold off.

It's been a violent, volatile last couple of sessions and the reason is inflation.

Inflation is an invisible tax on all of us. It will eat and erode the strength of the dollar. It will cut into your budget, it will tear everything that you do apart.

Interest rates for mortgages have gone up. Home price sales have gone down. The Fed cannot control food and energy, which is 20% of all of our inflation.

Inflation has impacted far beyond the reach of the Fed and its rudimentary tools.

The Fed has two tools right now, raising the Fed funds rate, which makes credit more expensive. Credit is about $50 trillion around the world versus cash is only about $3 or $4 trillion. Credit is what makes the world go round.

The inflation data was so high and the Fed has been so data-dependent as they like to say that on Monday afternoon after the market closed, they leaked out to The Wall Street Journal, Axios, and CNB, that they were going to do a 75 basis point rate hike after a couple of months of telegraphing that they will absolutely do 50 basis point rate hikes for three meetings in a row. The largest rate hike since 1994.

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We've seen data saying existing home sales are down.

And you hear this nine months supply number. But our good friend Logan Mohtashami, the lead housing analyst at HousingWire basically broke that nine months down, six of those months are homes that started new construction but were not yet completed.

We're seeing some of the sellers and listing agents change their strategy and wait for the numbers to come down to see a little bit more reasonable and good prices.

Wage inflation was up year-over-year, but it was up less than the prior month.

So maybe wage inflation is cooling off, which means that the price wage spiral that goes up, that keeps feeding itself and feeding inflation nationally may start to cool off.

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Cash supply and money supply are shrinking!

That's what the Fed is doing. They are shrinking the money supply. We're in quantitative tightening.

We've all experienced a lack of supply in housing. There is an opposite effect when you have less supply and overwhelming demand. The demand for U.S. dollars across the world.

Don't think just about us and our economy. Think about the rest of the world.

The demand for U.S. dollars across this country is enormous.

Across the global economies and even greater. So that is playing and wreaking havoc on the stock market. And it is creating issues with inflation and supply chains and it's all interconnected, everything that we do.

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Congratulations to Sandra Thompson, the new FHFA Director!

She's the first African-American female to be appointed to this position, which is quite an accomplishment.

We're seeing wealth gap widening, and the divergence of haves and have nots. We’re also seeing some softening in maybe some of those 11.5 million job openings from the JOLTS reports.

Some people may start to lose their jobs. We're starting to see some layoffs announced by some major corporations, in the headlines.  Will that continue going into the second half of this year?

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BlackRock is holding cash with two hands!

70% of the economy is based on consumer spending. Our consumers are still holding their cash. They're still in a good spot. But we have to continue to watch the haves and the have-nots.

There's been a labor hoarding going on. Cathie Wood from Ark Invest says that a lot of people have been hiring kind of as fast as they can because the employers don't want to pay for higher wages that have been going up the last year.

ICE (Intercontinental Exchange Inc) entered into an agreement to purchase Black Knight for $13.1 billion. The regulator still has to bless the transaction but there's a lot of M&A.

So I'll be interested to see how all those pieces accompany each other out there.

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Advanced GDP has a lot to do with inventory and trade. It was anticipated to be 1% growth and it came in at -1.4%.

So no one is saying that the final Q1 GDP will be negative. That doesn't mean that it won't.

Inflation is still high and persistent so the term stagflation is one where you've got stagnant growth. Not necessarily recessionary growth but just maybe flat. 1% growth is still growth.

Mr. Wonderful, Kevin O'Leary from Shark Tank is calling blockchain technology the 12th sector of the S&P.

Some of us are seeing Bitcoin and Ethereum prices go down by 48% from its peak but there are hundreds of millions of dollars being invested in projects to make blockchain better.

There are 1.9 job openings for every unemployed person. 6 million unemployed people, 11.55 million jobs open. So the economy and the labor market are tight.

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There's growth, slowing growth, and flat-out recession. Recession or the R-word is a very good thing for our business because there's a ton of refinances, low-interest rates, and we start booming.

But right now, we're in that in-between zone, where the expansion of the economy is slowing. We're still expanding. We're still growing.

Our economy is 19% larger now than in 2019. Homeowners have seen rapid appreciation, probably no less than 12% in any market, some markets as high as 28% year-over-year.

This pace of growth is unsustainable so it will slow down. But slowing growth is not recessionary growth. It is not a detraction or loss of growth.

And right now the jobs are very strong, the economy is still strong.

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