CNBC Guest: ‘The Economy Is Actually Pretty Strong Right Now’

EXCERPT:

ACKMAN: "You know, I think the economy’s actually quite strong right now. The question is where it’s going to be in 6 months or 12 months. You know, we’re at full employment, there are plenty of jobs available, wages are going up, Howard Hughes Company we own is opening a food hall, the Jean-Georges food hall at the South Street Seaport, we’ve had to hire 600 people and they’ve been working really hard to do it. We've only hired 350 people in the last couple months, so if you’re looking for a job, there’s a good one there. So I think the economy itself is very strong, I had the opportunity to see Jamie Dimon this weekend — I apologize, I do — I still am a little congested from Covid. And Jamie talked about, number one, this is the lowest default rate, period, in history for the consumer part of the bank. And there are a full spectrum of people that they, you know, poor to rich, that bank with JPMorgan Chase and so on, are in the best position they’ve ever been. So I think we've got well-capitalized consumers for the most part, although I do think lower-income people are getting a lot of pressure from higher gas prices, higher food prices, higher rental rates. And I think the biggest problem for the economy is inflation, and inflation is roaring, it’s continued to rage, and unfortunately the steps taken by the Federal Reserve have not been effective. Since June, the first 75-basis-point increase, financial conditions have eased enormously. The stock market’s up, depending on the market, 10-11 percent or more. You know, you look at the two-year treasury, which is the kind of good indicator of kind of where Fed funds should be over the next eight quarters, it's under 2.9%. And what the Fed today called it 2.5%, basically the market is saying that the Fed funds will average only 40 basis points above the current rate over the next two years. And that implies, really, no financial tightening at all. Just at the last meeting, Jerome Powell said that the Fed was now comfortable that it reached a sort of neutral level of rates, which, again, a fairly extraordinary statement in a world with 9% inflation.”