The American dream now comes with 23% interest



You may not know Steve Eisman’s name, but you should. He was the investor who bet against Wall Street in 2008 and won big — to the tune of $800 million, with a current net worth in the neighborhood of $1.5 billion. If you saw “The Big Short,” Steve Carell played him as Mark Baum.

Americans are past living paycheck to paycheck. They’re living loan to loan.

These days, Eisman hosts “The Real Eisman Playbook” on YouTube. And like in 2007, he’s warning again — this time about the fragile state of the American consumer.

He isn’t alone. In a recent episode, Eisman spoke with Lakshmi Ganapathi of Unicus Research, who shares her grim view of the U.S. economy. Their conversation, combined with the data, paints a picture more alarming than most headlines dare admit.

Consumers are broke

“If you deduct the AI expenditures,” Eisman said, “... the U.S. economy is not even growing, really, 50 basis points, outside of AI.” In plain English: Without the artificial-intelligence boom, growth would be nearly flat at around 0.5% growth — likely even lower — not the 3.8% the Bureau of Economic Analysis reported for the second quarter of 2025.

Ganapathi didn’t mince words either. “Consumers are broke,” she said. “The monthly budget math no longer works.”

That’s what happens when Washington spends decades pretending math doesn’t matter. During COVID, federal “stimulus” checks poured roughly $800 billion into households. The cash wave briefly made millions look creditworthy — even as the underlying economy collapsed.

“Subprime consumers became prime,” Ganapathi explained. With reporting on student-loan and credit-card delinquencies suspended, millions suddenly looked like perfect borrowers. Credit scores soared to 700 and 800.

“They got a check that made them look richer than they actually were,” Eisman noted.

Banks then bundled those inflated loans into asset-backed securities — the same shell game that fueled the 2008 meltdown. The illusion of “prime credit” returned, this time wrapped in COVID relief and moral hazard.

The debt pyramid

Ganapathi described auto loans now stretching to 84 months — seven years — at 22% to 23% interest, which is credit-card territory. Americans collectively carry $1.2 trillion in card debt and $676 billion in car loans.

Add mortgages and student loans, and the numbers turn grotesque. Americans owe $20.83 trillion on homes, with an average interest rate of 6.37% on a 30-year note, and $1.81 trillion on student loans. We pay roughly $1.6 trillion a year in interest alone.

And since Washington nationalized student lending under Obama, it can now garnish wages indefinitely. “If you file for bankruptcy,” Eisman said, “your student loan stays with you.” A debt you can never escape — courtesy of your government.

The federal government owes $38 trillion but somehow pays a third less in interest. Fairness, D.C.-style.

Kicking cans and eating debt

Ganapathi noted that 90-day-plus credit-card delinquencies have doubled since 2021. Consumers are defaulting on car loans. Banks, desperate to avoid repossession losses, simply “modify” the loans and call them current — the same can-kicking that defines Washington’s budget process.

At this point, 69% of Americans live paycheck to paycheck. Nearly a quarter of them now use “buy now, pay later” services to pay for their groceries.

RELATED: Jerome Powell proves the Fed’s ‘independence’ is a myth

Photo by Douglas Rissing via Getty Images

Yes — groceries.

Eisman spelled it out: People are literally financing food. They buy a week’s worth of groceries, then spend the next two or three months paying for them — often at interest rates that can hit 36% after a single missed payment.

Americans are past living paycheck to paycheck. They’re living loan to loan.

The illusion of prosperity

This is the real economy hiding beneath Washington’s sunny numbers — an economy where debt props up demand and borrowed time props up debt. It’s 2008 in slow motion, but this time it’s ordinary households, not hedge funds, holding the toxic paper.

When the middle class needs “by now, pay later” to eat, the “strong economy” line collapses into farce.

America’s consumers are tapped out, overleveraged, and fresh out of illusions. The only question left is how long the lenders — and leaders in Washington — can pretend otherwise.

Jerome Powell proves the Fed’s ‘independence’ is a myth



One of the least understood but most consequential aspects of American government is the United States Federal Reserve System. Bankers, investors, and even the president sit with bated breath, waiting to see how the Fed will manage interest rates.

The Fed is so important to the world economy that the president sometimes may feel the need to voice his administration’s position and hope the chairman of the Federal Reserve will acquiesce to his wishes. Sometimes, however, he may point out issues with the chairman’s performance, puncturing the claim of central bank independence. President Donald Trump recently accused Federal Reserve Chairman Jerome Powell of being too late with interest rate cuts “except when it came to the Election period when he lowered [interest rates] in order to help Sleepy Joe Biden, later Kamala, get elected.”

Powell was clearly willing to play political games that cost Americans their businesses and their ability to feed their children.

Americans had suffered through continued elevated inflation, in part, because Jerome Powell wanted to keep his job.

With the president’s attempted firing of Fed Governor Lisa Cook, Powell has jockeyed himself a position as the white knight of central bank independence. He alleges that tariffs, which have no connection with monetary policy on their own, are the cause of an increase in inflation. He seems intent on keeping interest rates high.

Whether that is a good decision is a different subject altogether (the Mises Institute’s Ryan McMaken takes on that idea). But what is clear is that Jerome Powell is not the principled opponent to Trump he claims to be; he is just as much a political actor as the president and Congress.

Powell’s politicization

Powell’s politicization is clear in how the Fed functions today. Economists and political scientists stress the importance of central bank independence as a hedge against what is called “political business cycles.” These cycles occur when monetary authorities pump the economy full of easy money to suppress employment problems and create an illusion of prosperity. This eventually results in higher inflation. Politicians reap the benefits of this illusion and blame inflation on something else: energy shocks, supply shocks, disasters, tariffs, etc.

The root of the problem is when new money is created to push down interest rates. Politicians who have control over the monetary authorities are incentivized to push for easier monetary policy to relieve unemployment in the face of elections. If they lose, their opponents reap the consequences; if they win, rates might be allowed to rise to fight inflation, and the illusion is dispelled.

By insulating the central bank from political pressure, the Fed is supposed to be able to pursue its mandates such as low and stable inflation or low unemployment. While this appears sound at first glance, reality shows that the Federal Reserve has never truly been independent.

A history of faux independence

The crowning moment that defines U.S. central bank independence is the Treasury-Fed Accord of 1951, which severed the support the Fed had given the Treasury Department in financing World War II and the Marshall Plan. But as Jonathan Newman has uncovered, this accord was a declaration of independence in name only.

The chairman of the board of governors, Thomas McCabe, by all accounts did appear to favor the separation of the Federal Reserve’s functions from that of the Treasury’s. Yet McCabe was not present at the Accord meetings. Moreover, McCabe resigned in protest soon after they concluded.

Treasury stooge William McChesney Martin Jr. was then appointed Fed chairman. Martin paid lip service to the idea of an independent Fed but ultimately revealed his cooperation with the Treasury Department in a 1955 interview. President Kennedy even renominated him for having “cooperated effectively in the economic policies of [his] administration.”

The Treasury and the Fed have had a revolving door ever since. Martin had chaired the Export-Import Bank in addition to serving as assistant treasury secretary. G. William Miller left his role as Fed chairman to serve as the secretary of the treasury. Paul Volcker served in Nixon’s Treasury Department before joining the Fed.

Particularly egregious was Janet Yellen, who served on President Bill Clinton’s Council of Economic Advisers and then was appointed to the Federal Reserve by both Clinton and later President Barack Obama. She ultimately would become secretary of the treasury under President Joe Biden. Even Jerome Powell served in President George H.W. Bush’s Treasury Department before returning to the private sector. Barack Obama appointed Powell to the Federal Reserve Board, and President Trump later nominated him as Fed chairman.

The constant revolving door between the CEA, the Treasury Department, and the Federal Reserve is no different from agencies like the Food and Drug Administration, Centers for Disease Control, and Department of Energy. It reeks of corruption and political influence and certainly proves the Federal Reserve is not truly independent.

Playing political games

Examining Jerome Powell’s own actions when his job was on the line shatters the illusion of so-called central bank independence.

In 2021, as inflation began to climb, Powell dubbed the phenomenon “transitory.” The Biden administration had just taken office a few months prior, and rampant inflation was likely to stick around for the midterm elections. Thus, blame had to be cast elsewhere. It’s also noteworthy that Powell’s four-year term was set to expire in 2022. If you are up for a performance review, you might choose to kiss up to your boss so that you aren’t fired. Central bankers are no different.

Inflation continued to rise through November, climbing to 7% year over year. Americans demanding relief could not turn to Jerome Powell, who kept the Federal Funds Rate at 0%, attempting to hide the real state of the economy for Biden, who renominated him that same month. It was only then that Powell dropped the term “transitory” to describe inflation.

The first rate hike of 0.5% happened in May 2022, after the Senate Banking Committee had advanced Powell’s nomination. Soon after, with rates still low, Powell was confirmed by a Democrat-controlled Senate. Only two months after his confirmation, the Fed finally began to hike interest rates at historic speed. Inflation had peaked in June at 9% year over year. Americans had suffered through continued elevated inflation, in part, because Jerome Powell wanted to keep his job.

RELATED: Ron Paul exposes how the Federal Reserve keeps up its scam

Photo by Laura Segall/Getty Images

A Fed that was hawkish on inflation would have raised interest rates higher and faster than Powell did, not allowing inflation to run rampant. Powell was clearly willing to play political games that cost Americans their businesses and their ability to feed their children.

The Fed has never been independent — it has always been political. Economists would do well to admit this and argue their case rather than pussyfoot around the question of what interest rates should be or if interest rates should be set at all.

Editor’s note: This article was originally published at the American Mind.

Market soars after Fed finally cuts interest rate



The Federal Reserve cut interest rates on Wednesday, sending at least one stock market soaring.

On Wednesday, the Fed announced that it had decided to cut the federal funds rate by a quarter of a point, bringing the new rate range down to 4-4.25%. The committee made the decision to reduce the rate despite continued "uncertainty about the economic outlook."

'He should have cut them a year ago.'

While the committee apparently continues to worry about reportedly slowing "job gains" and a slightly higher unemployment rate, at least one market rallied in response to the news. The Dow Jones immediately jumped over 400 points, though those gains soon moderated. As of mid Wednesday afternoon, the NASDAQ and S&P were down.

Late last month, when Fed Chairman Jerome Powell teased a possible upcoming rate cut, President Donald Trump indicated that any such cut would be too little, "too late."

"He should have cut them a year ago," the president said at the time. "He's too late."

RELATED: Powell’s tight money policy is strangling the US economy

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Trump has also lately referred to the Fed chairman by the nickname "Too Late." "'Too Late' MUST CUT INTEREST RATES, NOW, AND BIGGER THAN HE HAD IN MIND. HOUSING WILL SOAR!!!" the president wrote on Truth Social on Monday.

Blaze News reached out to the White House for comment.

This is a developing story.

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Trump’s Fed Pick Clears Hurdle Before Critical Meeting On Interest Rates

The Senate voted to cut off debate on chief White House economist Stephen Miran’s nomination to serve on the Federal Reserve Board on Monday evening in a near party-line vote, teeing his confirmation up for a vote on final passage. Senators voted 50 to 44 to confirm Miran to an open seat vacated by Biden-appointed […]

America’s ‘prosperity’ is built on broken families and debt



Ever since the COVID “Great Reset,” the American economy has functioned like a silent depression for two-thirds of households and most businesses. Washington pumped out biblical levels of spending and easy money, and a cycle of debt, high prices, and stagnation has crushed consumers.

Meanwhile, a handful of well-connected corporations — propped up by cheap credit, regulatory favors, and asset bubbles — keep the stock market afloat, creating the illusion of growth. The result is an economy that looks healthy on paper but feels like collapse on Main Street.

Enough. A nation cannot live on financial tricks and asset bubbles forever. Let the recession come.

The time has come to let it crash. No more bailouts. No more “too big to fail.” If we want a free-market recovery built on broad opportunity and wage-based wealth, we must let the bubbles burst.

The silent depression

Americans live under record-high prices for food, fuel, rent, and electricity. College graduates face the worst job market in decades. Payroll data shows just 1,494 new jobs were added in August — the weakest since the 2008 crash. Layoffs are up 38.5% this year.

For graduates, the outlook is even worse. Fortune reports that 58% of recent grads still can’t land a job or internship. Forty percent of the unemployed last year never even got an interview. One in five job seekers remained unemployed for 10 months or more.

Those already employed are struggling to make ends meet. Thirty-seven percent of workers have tapped retirement accounts for hardship withdrawals or loans. Personal spending, adjusted for inflation, fell 0.15% in the first half of 2025 — the sharpest decline since the financial crisis.

Families are drowning in debt. Household debt sits at $18.39 trillion, up $600 billion in one year. Student loans total $1.64 trillion, with more than 10% delinquent. Credit card debt has hit $1.21 trillion, with average APRs over 22%. Auto loans stretch to seven years for one in five new vehicles. Nearly half of renters now spend more than 30% of their income on housing.

A stock market built on sand

You’d expect Wall Street to slump alongside Main Street. Instead, the S&P 500 posts records. Why? Because 10 mega-cap tech stocks make up 40% of its total market cap. Strip them out, and the picture darkens.

More than 450 large companies filed for bankruptcy in the first half of 2025, the most since the Great Recession. Manufacturing has lost 78,000 jobs. Construction spending has fallen in seven of the past 11 months. Small caps fare even worse: 43% of Russell 2000 firms are unprofitable.

AI hype fuels the illusion. Nvidia’s data center revenue — half of it from just three shaky firms — drives much of the market. The S&P’s price-to-book ratio now tops the dot-com bubble. This is not sustainable growth; it’s speculation on steroids.

The housing bubble must pop

Housing has become the last pillar propping up the economy. Thanks to years of near-zero rates, federal subsidies, and trillions in mortgage-backed securities, the housing market ballooned to $55 trillion — $20 trillion more than in 2020.

But affordability is gone. The frozen market now shows cracks as prices fall in half the country. This is the moment to let it reset. Instead of lowering lending standards or declaring housing “emergencies,” the Trump administration should allow prices to match real wages.

Americans can’t keep using housing as a savings account or demanding 25% annual stock returns while complaining about inequality. You can’t have both free markets and endless asset bubbles.

RELATED: No peace without steel: Why our factories must roar again

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Stop feeding the beast

Wall Street already salivates over another round of stimulus to keep the AI bubble inflated. Evercore ISI predicts the S&P could hit 9,000 by 2026, even while warning this could become the “biggest bubble ever.” By then, the economy would be addicted to corporate welfare, and taxpayers would foot the bill for the richest companies in history.

Enough. A nation cannot live on financial tricks and asset bubbles forever. Let the recession come. Let the bubbles burst. Only then can America rebuild a market economy rooted in work, savings, and production — not in debt and fantasy.

Won’t somebody finally stand up and shout stop?

Trump Was Right To Fire Fed Governor Lisa Cook, And Here’s Why

In public service, integrity is judged in real time, not deferred until a jury renders a verdict.

Fed chair Powell signals potential rate cuts — but Trump says it’s ‘too late’



Federal Reserve Chairman Jerome Powell signaled on Friday that he may consider cutting interest rates in the near future.

During a speech at an annual gathering in Jackson Hole, Wyoming, Powell hinted at the possibility of changes to interest rates at the next September meeting due to a "shifting balance of risks."

'I personally believe the Fed could cut a full percent and still not have policy unleash inflationary pressures, but I don't foresee a cut that substantial in September.'

He contended that the Federal Reserve's "restrictive policy stance" has been "appropriate to help bring down inflation and to foster a sustainable balance between aggregate demand and supply."

Powell blamed "higher tariffs" for introducing "new challenges" to the U.S. economy and "tighter immigration policy" for causing an "abrupt slowdown in labor force growth." He contended that both factors have impacted demand and supply.

"Over the longer run, changes in tax, spending, and regulatory policies may also have important implications for economic growth and productivity," Powell claimed. "There is significant uncertainty about where all of these policies will eventually settle and what their lasting effects on the economy will be."

RELATED: Powell’s tight money policy is strangling the US economy

Photo by Chip Somodevilla/Getty Images

He argued that "risks to inflation are tilted to the upside and risks to employment to the downside." Powell called it a "challenging situation" given that the Fed's "framework calls for us to balance both sides of our dual mandate," referring to the labor market and price stability.

However, he indicated that with the policy rate "100 basis points closer to neutral" compared to last year and stability in labor market measures, the Federal Reserve may "proceed carefully as we consider changes to our policy stance."

"Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance," Powell said.

RELATED: Trump orders Labor Statistics chief to be fired over revisions in weak jobs report

Photo by Chip Somodevilla/Getty Images

President Donald Trump has repeatedly urged Powell to drop interest rates.

"He should have cut them a year ago. He's too late," Trump said Friday afternoon in response to Powell's speech.

Blaze Media contributor Carol Roth told Blaze News, "Reading between the lines, it certainly sounded like Powell was signaling a higher likelihood of a September rate cut, something that the market had already been expecting. In terms of the Fed's stated 'dual mandate,' the pendulum seems to be swinging to more concern over the labor market than inflation, although certainly not ignoring inflation, but rather wanting to avoid a stagflation scenario," Roth said.

"Powell is definitely late to a rate cut, both in terms of supporting the economy and giving the Fed room in terms of future ability to raise rates in the face of any potential spikes in inflation," Roth continued. "While 25 basis points (one quarter of a percent) is the likely size of a cut, it probably isn't enough to be meaningful in terms of consumer or business behavior — it seems more symbolic. I personally believe the Fed could cut a full percent and still not have policy unleash inflationary pressures, but I don't foresee a cut that substantial in September."

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The rate cliff is real — and Washington created it



It’s never been more unaffordable to buy and finance a home in America. And yet, government officials seem confused about the cause, chasing “solutions” that will only make things worse. They want more building, lower rates, and more subsidies. But none of that fixes the core problem.

We don’t have a shortage of homes. We have an affordability crisis driven by government intervention — one that’s inflated yet another asset bubble. Housing, like education and health care, has been hijacked by easy money, fake pricing signals, and federal subsidies designed to mask structural rot.

You can’t paper over decades of distortion with another round of Fed intervention.

The solution isn’t more easy money. It’s pulling the plug on government policies that distort markets. Enough with near-zero interest rates. Enough with the Federal Reserve buying mortgage-backed securities. Enough with Fannie, Freddie, and the FHA inflating demand that the market can’t sustain.

Cause and effect

Remember the late ’90s? Mortgage rates sat between 7% and 8%. Nobody panicked or complained much about the cost of living. People bought homes. Prices were reasonable. Inflation was low because deficits were shrinking and money wasn’t being printed into oblivion.

Then came the dot-com crash, George W. Bush’s post-9/11 spending spree, and the Clinton-era “affordable housing” schemes coming due. The Department of Housing and Urban Development’s footprint expanded. The Fed, under Chairman Alan Greenspan, dropped rates to near zero — the same path Trump wants now — and we inflated the first major housing bubble of the 21st century.

From 2001 to 2006, Washington juiced the market at every turn. M2 money supply growth topped 10% and stayed above 8% into 2003. The Fed funds rate plummeted from 6.25% to 1%, where it stayed for a full year. Real rates were negative for two and a half years.

No surprise what followed: Real estate loans at commercial banks surged at a compound annual rate of 12.26%. Cheap money and inflated supply pushed prices through the roof. The result was a bubble built not on demand but distortion.

Then came the collapse.

And what did Washington do? Bailouts for big banks. Bailouts for Fannie and Freddie. Dodd-Frank. Obamacare. Trillions in new debt. The Fed held rates near zero for six more years, planting the seeds for the next wave of asset inflation — especially in housing.

Then came COVID.

The government printed $7 trillion and subsidized nearly everything. Rates dropped back near zero. The Fed bought trillions more in mortgage-backed securities. Freddie, Fannie, and the FHA expanded their subsidies even further. By 2021, we had the biggest housing bubble in American history.

Welcome to the rate cliff

Now, we’ve hit the wall. The Fed had to raise rates to fight inflation. That created a generational rate cliff. Sellers don’t want to give up their 2% and 3% mortgages. Buyers can’t afford homes at today’s prices — prices that are still artificially high thanks to 15 years of easy money and government meddling.

And yet, housing starts have held up decently. The problem isn’t inventory — it’s liquidity and affordability.

In June, existing home sales dropped to their slowest pace since 2009. But it’s not because no one’s selling. Redfin reports 500,000 more sellers than buyers — a 33.7% gap, the widest since 2005. Total inventory rose to 1.53 million units, up nearly 16% from last year. Vacancies have spiked 28% since the second quarter of 2022. New home supply has ballooned to 9.8 months.

RELATED: Government broke the housing market — only this will fix it

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In a real free market, prices would drop sharply. But when government, either directly or indirectly, backs 90% of the U.S. mortgage market, that’s not how it works. Subsidized mortgages and distorted demand keep prices frozen — even as sales crater.

Sellers want prices buyers can’t afford. According to the Atlanta Fed, a household now needs $124,150 in “qualified income” to afford the median home. But the median household income is just $79,223.

Lowering interest rates again won’t fix this. It’ll just stoke inflation and feed the next bubble. And with the Treasury dumping trillions in debt onto the market, 10-year yields — and therefore 30-year mortgage rates — aren’t coming down anytime soon.

Absent a 2008-level crash, housing prices aren’t dropping meaningfully. We’re stuck.

You want lower rates? Cut spending

If you want rates to fall, slash spending and debt. That’s how you bring prices down. You can’t paper over decades of distortion with another round of Fed intervention.

Live by Fed money printing, die by Fed money printing.

'Stubborn moron': Trump calls for the Federal Reserve Board to 'assume control' from Powell — on one condition



Tensions have continued to rise between President Trump and Chairman of the Federal Reserve Jerome Powell since Trump's visit to the bloated construction project at the Fed's headquarters last week. Trump's criticism of Powell's leadership and refusal to lower interest rates has led to some heated exchanges between the two leaders.

On Friday morning, Trump posted two messages directly calling out the chairman of the Federal Reserve: "Jerome 'Too Late' Powell, a stubborn MORON, must substantially lower interest rates, NOW. IF HE CONTINUES TO REFUSE, THE BOARD SHOULD ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE!"

'I believe that the wait and see approach is overly cautious, and, in my opinion, does not properly balance the risks to the outlook and could lead to policy falling behind the curve.'

In another Truth Social post, Trump lashed out again: "Too Little, Too Late. Jerome 'Too Late' Powell is a disaster. DROP THE RATE! The good news is that Tariffs are bringing Billions of Dollars into the USA!"

A Wednesday press release recounted a vote on monetary policy. While nine members of the committee voted to "maintain the target range for the federal funds rate at 4-1/4 to 4-1/2 percent," this decision was not unanimous. Michelle Bowman and Christopher Waller dissented from this action, preferring to lower the federal funds rate by 1/4 percentage point. This, however, is still far below the rate cuts that Trump is aiming for.

RELATED: Jerome Powell’s luxury Fed is failing the American people

Photographer: Al Drago/Bloomberg via Getty Images

On Friday, Board member Waller explained his dissent from the majority "wait and see" approach, calling it "overly cautious" and claiming it "does not properly balance the risks to the outlook and could lead to policy falling behind the curve."

Bowman, likewise, gave a statement on Friday explaining her dissent: "I see the risk that a delay in taking action could result in a deterioration in the labor market and a further slowing in economic growth."

Trump's aggressive tariffs have stimulated the economy and have secured many trade deals. However, Powell has reportedly said that this short-term success is not indicative of long-term stability. “We’ve learned that the process will probably be slower than expected,” Powell said. “We think we have a long way to go to really understand exactly how” the tariffs will affect inflation and the economy.

The Federal Reserve Board declined Blaze News' request for comment.

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Jerome Powell Pressed On Why Fed Isn’t Lowering Rates To Help Americans Afford Homes

'How do you justify that?'