Dear Kay: I Just Saw The Banking News. Are We Screwed?


Kay Smythe News and Commentary Writer
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Dear Kay: I just saw that a bunch of banks failed last week. I just bought a new home in 2022 at a high interest rate and mortgage. Are we in a recession? Is my family screwed? — Sincerely, Financial Novice 

Dear Financial Novice,

Your self-awareness is really humbling. I’m sure, like so many other people I know, you were swept up in the rush of owning a beautiful home for your family.

While I’m not personally convinced you’ll be able to keep that home (unless you can buy it outright today) there’s also no telling how bad or good things could get from here. So here’s some general information, tips for future education, and what I would do if I was in your position.

We’ve been heading into a financial crash or “recession” for quite a while. It took major financial institutions until the start of 2023 to concede that things are not going well for the economy. Back in August 2022, financial expert Michael Burry (yes, the guy Christian Bale portrayed in “The Big Short) sold off all but one stock and warned of a major market crash.

Burry’s predictions were quickly echoed by the likes of Dr. Nouriel Roubini — who also foreshadowed the 2008 financial crisis — and billionaire investor Stanley Druckenmiller. Aside from these huge, highly educated voices screaming their concerns, you’re alive and breathing. You knew there was something wrong with the economy because the cost of all goods has gone up seemingly day after day since the pandemic.

Don’t listen to the experts the media and government tell you to listen to… ever. Personally, I don’t believe the pandemic caused this financial crisis. I am not educated enough to explain why I feel this way, but I listen to a lot of very smart people who feel similarly. I listed at least three of those experts in my previous paragraph.

The mainstream banking sector and government depend on you, the average consumer, being stupid and greedy. That’s how they make their money. When you want real financial advice, listen to those who earn nothing from you. (RELATED: Expert Economist ‘Dr. Doom’ Predicts ‘Long And Ugly’ Recession That Could Change The World)

You’re not screwed. But you may need to rethink your current expenditure. There’s no telling where the economy is going from here, nor what the government and Fed will do to make things (probably) worse. My biggest concern right now is how this economic upheaval will impact our day-to-day lives.

Goldman Sachs only said in January that at least four major housing markets could crash in 2023. But anyone who bought a home in the last few years under current interest rates needs to seriously reconsider whether they want to keep that purchase. I highly recommend listening to this very short clip from Newsmax host Carl Higbie on why:

Cutting down on all unnecessary expenditures is what everyone should be doing right now. Keep as much of your cash flow accessible, or use it on items that do not devalue. Your home, while you might think you own it, you literally don’t unless you’ve bought it out-right.

It’s time to adjust what brings you joy. The easiest way to weather any type of financial upheaval is to adjust your expectations of “fun.” Instead of going out to dinner, events, and vacations, stay local and spend local in the coming months. Do anything you can to save money and bring yourself joy, because this won’t be a short-time lifestyle switch.

And if you suffer from Fear of Missing Out (FOMO), just remember that all your friends continuing to live like nothing is wrong could be back living with their parents by Christmas. (RELATED: NYT Idiots Ignore Dire Financial Warnings For 2023 From Leading Experts)

Now is the time to get sentimental, and realize your purpose on this planet is to create a legacy for future generations. The moment we stop spending like we’re keeping up with the Kardashians, a lot of our financial and mental health issues go away. Not all of them, but a lot.