Anthony Scaramucci, financier, explains the housing crisis: “Half of the people in the U.S. can’t afford their house”
The founder of SkyBridge Capital sat down for a chat at Hunt and Fish Club where he talked about the state of the U.S. economy and what’s broken in America.
Americans have been suffering through an affordability crisis that is getting worse on a daily basis. This can be seen at the gas pump with the national average over a dollar more than it was a year ago.
Another place where higher prices can be felt acutely is in housing. The median price of a house in the U.S. has come down somewhat since peaking at the end of 2022. However, it is still above $400,000 according to Federal Reserve data.
Half of the people in the U.S. can’t afford their house
Anthony Scaramucci, the founder of SkyBridge Capital, explained to Dan Nathan and Guy Adami on their The RiskReversal Podcast that the average American household needs to bring in $160,000 a year in order to afford a house, “pay the mortgage, and have a little bit of cash left over so that you’re not house rich and cash poor,” he said.
However, he pointed out that the median annual income is $84,000 in the U.S. “So, that means half of the people in the United States, they can’t afford that house,” Scaramucci observed. “They’re skipping dentistry. They miss a prescription drug or maybe the car got dented and they can’t bring it to the repair store.”
Inflation destroying the working class
The financier also raised concerns about the national debt swelling to unsustainable levels. “We’re overextended as a welfare state,” he noted. “We have a group of politicians that have overpromised the electorate and undertaxed them.”
Scaramucci pointed out that politicians have decided that we are going to pay off the debt “in the most pernicious and regressive way, and that’s through inflation.”
“This pernicious inflation, this regressive tax is hurting people, and they’re angry,” he added.
Restoring the American dream
While those with assets and investors on Wall Street are relatively protected, he said lower middle-income families with no assets are “getting destroyed” as the value of the dollar decreases. It’s also helping to drive an ever-larger wealth gap, which in order to fix the root causes must be dealt with.
One of those he traces back to globalization and the offshoring of so many jobs. While he and other investors were applauding the move at the time, he said that the people protesting the World Trade Organization meeting in Seattle in July 1999 were right.
The other is the entrenched duopoly of power in Washington that makes it impossible for third part candidates to run successful campaigns. Scaramucci highlights that the two major parties have secured their control on power through gerrymandering and that “they’re not focused on the little guy.”
“So you need to reform those two aspects,” the financier explained. “And until you do that, you’re not going to recreate that American dream in the country.”
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