Saturday, April 01, 2023

After weeks of early morning selichos, two days of commemorating Rosh Hashana, and just completing a full day of fasting and repenting on Yom Kippur – we are all tired! But, before you take that breath to catch up, Succos will be here with so much to do. It is the most intense weeks of the Jewish calendar, and this would be an opportune time to thank our wives, members of our families, and leaders of our shuls for all of their tireless work in making these days memorable and successful.

Shifting fronts, this article headline also references the recent commentaries that I have been reading that say people are simply tired and worn out from all that has been thrown at them since the start of Covid in 2020. We couldn’t even catch our breath post-COVID, vaccine dramas, and returning to everyday life when we were smacked in the gut with a forty-year high inflation crisis. With it, massive rate hikes and impending recession dooms.

Bankrate.com just published, “Americans have recession fatigue — and it’s keeping them from preparing for the next downturn.” According to the commentary, “Experts are calling it ‘recession fatigue,’ and it might be why nearly a third of Americans say they’re not prepared for a recession.” A Bankrate poll from August found that most aren’t taking any steps to prepare for an economic downturn. Even worse, that number jumps to 42 percent for the Americans who say they’re not at all equipped for a recession.

As of September 30th, the end of the third quarter of 2022, the S&P 500 was sitting at 2-year lows, down 23% this year, less than Nasdaq’s drop of 31% thus far. Mortgage rates were reported to have reached over 7% last week as economic uncertainty continues to plague the markets. The only good news, for now, is that gas prices have suddenly dropped from their recent highs.

If these dire statistics weren’t convincing enough, last week, we logged the final reading for Q2-GDP, which came in at 0.6%. After a negative -1.6% reading in Q1, we are now in what has been historically identified as a recession. Since 1947 there have not been two consecutive quarters of negative GDP that have not been classified as a recession, and in time, I am sure this will not be any different.

For some odd reason, the official “referee,” the NBER (National Bureau of Economic Research), has not yet classified this as an official recession, as they decided they now need to see a certain level of economic contraction that has “a certain depth, duration, and diffusion.” If you ask me, that’s just another way to stall, perhaps to give Americans time to catch their breath.

I believe everyone is tired of hearing that we are in a recession because no one is giving any practical advice. Instead, they use doom and gloom headlines as clickbait to continue spreading fear and panic. We are now at the point where everyone is simply immune to these discussions or frozen with fear. While I am not a certified financial advisor, I have been helping my friends and clients with practical suggestions to help during these challenging times.

My recommendation is to conserve cash and prioritize paying down debts whenever possible. Reevaluate spending and reduce any avoidable expenditures. This sounds obvious, but so many households are on autopilot with their bills and never bother to review expenses. For those with extra cash, look for alternative higher-yielding options such as government ibonds (offering 9.6%) or high-interest rate savings accounts (now over 3% yields). If you have the stomach, keep dollar cost averaging your stock market investing. There are plenty of other suggestions, feel free to reach out directly to me for more.

More than anything, I highly recommend that people manage their mindset and be diligent with the news they consume. There is much negativity out there, and it’s very easy to become paralyzed with doubt and fear. In this environment, where your invest your time is more important than how you invest your money. Wishing you all a Chag Sa’meach.

Shout out and happy birthday to Lonny Bardash, Avi Berger, Rabbi Aharon Ciment, Naftali Cohen, Adam Ehrenreich, Dovid Engel, Reuven Escott, Alan Finkelstein, Efrona Hagler, Naphtali Hoff, Miriam Kaminetzky, Deena Katz, Michal Krug, Mark Lipner, Aviva Orlofsky, Sylvia Nachtigal, Lahav Reznik, Aliza Rosansky, Karen Rubin, Penny Samuel, Roni Schwartz, Arun P. Thomas, Avi Tsadok, Mark Watson, and Stacey Younger

Shmuel Shayowitz (NMLS#19871) is a highly regarded Real Estate & Finance Executive, Writer, Speaker, Coach, and Advisor. He is President and Chief Lending Officer of Approved Funding, a privately held national mortgage banker and direct lender. Shmuel has over twenty years of industry experience, holding numerous licenses and accreditations, including certified mortgage underwriter, licensed real estate agent, residential review appraiser, and accredited investor, to name a few. Shmuel has successfully navigated through many changing markets and business landscapes, making his market insights and experience well coveted within the real estate industry. He can be reached via email at [email protected]

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