WICHITA, Kan. (KSNW) – There are now record high gas prices, mortgage rates at their highest in more than a decade and the war in Ukraine driving up demand and prices in the world market. Is this another repeat of 2008?
In 2008, the US was waging two wars, the real estate market was hot and gas prices were over $4 a gallon in much of our country.
On Tuesday, AAA reported a new all-time high in gasoline prices: the national average for unleaded gasoline is $4.37 a gallon and $5.55 for diesel. Most gas stations in Wichita sell unleaded for $3.99, while some sell it for $4.09 a gallon.
Some economists are warning that we could face a fate similar to that of 2008 when the market crashed, leading to the 2009 recession and mortgage crisis.
KSN spoke to Dr. Ted Bolema, an economist at Wichita State University, and while acknowledging the similarities between this year and 2008, he mentioned another time we should be concerned about.
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“I’m old enough to remember the last time we had a serious inflation problem and it took a serious, really serious recession in the early ’80s to pull us out of it,” Bolema said.
Bolema stressed that inflation is the big difference, and now it’s rising to a point where the cost of living isn’t keeping up and some are struggling to find solutions to money problems.
“We are now hearing from people who are struggling to make ends meet and who are renting out parts of their houses and rooms so they are becoming more popular as people who own houses and are struggling to make ends meet after a are looking for an additional source of income and people who do not have a home are looking for a place to stay,” said Bolema.
There is some relief on the housing front as some feel the sweltering market could be starting to cool, a real estate agent told NewsNation.
“In both years there are many concerns about the general economic situation,” Bolema said. “Right now, inflation is around 8 or 9 percent and wage increases are closer to 5 or 6 percent.”
“Now we’re seeing about three or four really solid offers, maybe even one great offer, but definitely not ten or twenty or more,” said Allison Ziefert, a New Jersey real estate agent.
The other big difference between 2008 and today is the job market. Bolema said job seekers have more choices today than they did 14 years ago, and companies are starting to negotiate more flexible options.
“We’re getting through these things, I think it’s going to take a while, but we’re talking about 2008 and we’ve recovered from that problem,” Bolema said.
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