The Current Housing and Lending Market

Over the course of this year, there have been a lot of questions and concerns about inflation,interest rates, and the economy in general. We haven't been sure how to answer these questions up to this point. But it seems things are becoming a little more clear over the last several weeks. The current economic climate is entirely different than what we saw in 2008. In 2008 the recession was driven by bad bank loans. , which in turn caused banks to run out of cash and filebankruptcy or stop lending. So how are banks doing today? Well, over the last week, the large national banks have been releasing their "third quarter" reports. And they are reporting phenomenal earnings! JPMorgan Chase (JPM) – the biggest U.S. bank – reported its highest quarterly net interestincome ever. The bank also raised its guidance for the year, which indicates a positive outlook. According to JPM's CEO Jamie Dimon, the bank is sitting on 1.2 trillion in cash. With trillions of dollars at their disposal, banks have a lot of money on the sidelines to lend and invest.These banks have both the ability and the willingness to lend. Remember, banks make money when they lend... That's their primary business model. We simply don't have a credit issue like we did in 2008. Yes, inflation, the war in Europe, and supply-chain constraints are all big problems. But in our opinion, they're not catalyzing a financial crisis that would devastate the entire economy.