Episode 55

A Chief Economist Projects Inflation and Rising Interest Rates

with Ryan Severino

March 24, 2022

Ryan Severino
Chief Economist, JLL

Ryan Severino is the chief economist at JLL where he manages the economics team and is responsible for global and regional economic research, analysis and forecasting as well as property market forecasting.​

Prior to JLL, Ryan served as senior economist and director of research at Reis in the research and economics department, the team responsible for the firm’s market forecasting, valuation, and portfolio analytics services. Ryan also served as the Associate Director of Research at MetLife Real Estate Investments where he was responsible for macroeconomic and real estate market analysis, formulating portfolio strategy, and conducting deal reviews. Before joining MetLife, Ryan served as the Director of Investment Strategy and Market Research at Starwood Capital Group where he directed the entire research effort at the firm. Ryan has also held research positions at Prudential Real Estate Investors and UBS.

Additionally, Ryan currently serves as an Adjunct Professor of finance and economics at Columbia University and New York University teaching courses such as Urban Economics, Portfolio and Risk Management, Microeconomics, and Macroeconomics. He also has experience in real estate asset management, portfolio management, and acquisitions.

Ryan’s original research has appeared in a number of journals such as the Wharton Real Estate Review and The Real Estate Finance Journal. His assessments of market conditions have appeared in international publications like The Economist, The Wall Street Journal, The New York Times, and The Financial Times and on business networks such as CNBC and Bloomberg. Ryan is a member of the CFA Institute, the American Economic Association, ULI, and NCREIF.

Ryan holds a master’s degree from Columbia University, where he studied International Finance and Economics, a bachelor’s degree from Georgetown University, where he studied Finance, Japanese, and Economics, and is a CFA Charterholder.


The parts of the economy that aren't going to be impacted by technology, if there are any, will be small.



[00:00:06] Gary Bisbee, Ph.D.: How do we best understand and anticipate the effects on the economy of inflation, interest rates, COVID, and the war in Ukraine? The answer is to speak with a chief economist. Today, we welcome Ryan Severino, Chief Economist at JLL. Ryan is also an adjunct professor at Columbia University and NYU. And he speaks economics so those of us who are not experts can apply what we learn. The Federal Reserve held its March meeting several days ago and Ryan shared the Fed’s view of inflation and its strategy to raise interest rates. We discussed the demand and supply factors in the economy, including job growth, wage increases, federal COVID stimulus of $6 trillion, and pent up spending due to COVID, all of which have contributed to the increase in inflation. For young leaders, ryan advises them to be adaptable. The world is changing more rapidly than ever. Being resilient, flexible, and a constant learner is key to success.

Well, good afternoon, Ryan. And welcome.

[00:01:11] Ryan Severino: Hey, Gary, how are you?

[00:01:13] Gary Bisbee, Ph.D.: I’m well. We’re pleased to have you at this microphone. Boy, I was thinking right before our interview, as the Chief Economist, your life has been active in the last several months. You’ve got COVID. You’ve got inflation. Now we’ve got interest rates. Now we have a war in Ukraine. How are you holding up, Ryan?

[00:01:34] Ryan Severino: You know, it’s not dull. I’ll say that. It’s not always easy. And somehow finding the time to get everything done feels a little impossible. But boy, it has certainly not been, it’s not been dull for the last couple of years. I can honestly say that.

[00:01:48] Gary Bisbee, Ph.D.: Yeah, that’s for sure. Well, of course, with healthcare being, these days, 19% of the GDP, things that happen with the economy affect healthcare, whether it’s healthcare policy or politics, or our institutions, or us as consumers. So we’re eager to dive in here. And since you’re an adjunct professor at Columbia and NYU, just consider this economics 101, Ryan, we’ll be off and running. So can you share with us, what does a chief economist do? What does that role do?

[00:02:22] Ryan Severino: Well, I really think of my role as trying to understand what’s going on big picture in the economy, how we live our lives as consumers, as employees, as employers. What are we really doing on a day to day basis and how does that impact not just ourselves individually, but each other, especially in the context of demographics, what the composition of the world looks like at a particular point in time and, to something that you alluded to, I think even in the context of politics and geopolitics. I’m not a political scientist. I mean, I’ve certainly studied it a bit, but it’s really sort of thinking about how those pieces fit together. The economic activity that we’re partaking in every day. How do we fit into the broader demographic narrative of who actually exists at a given point in time? And then how does the political environment actually provide some feedback onto that? So it’s really sort of the confluence of those things. And then specifically at my employer, thinking about what it means for real estate and different types of real estate that I think most people now are more aware of the importance of real estate on a day to day basis with the pandemic than maybe prior to the pandemic, where they didn’t think a lot about where they were working or where they were living, or where they were shopping and playing, at least not in the acute way that they tend to think about it now.

[00:03:37] Gary Bisbee, Ph.D.: Well, give us a brief rundown on JLL for those of us who may not be that familiar with it, if you could.

[00:03:44] Ryan Severino: Sure. So JLL is a very large S&P 500, Fortune 500 global commercial real estate services firm, really runs the gamut. Almost everything that pertains to physical real estate, JLL gets involved in, whether it’s working with owners, working with tenants, working with investors, whether it’s, you know, to think about how we’re utilizing space or how we could be even creatively thinking about what to do with space in a way that might be different from what we’ve thought of historically. And, I don’t remember how many countries we operate in, but as a global firm, it’s more than I can recall off the top of my head. And we are probably pushing about 100,000 employees around the world. So my job ends up getting pretty involved because, as I’m fond of saying, I’m getting pulled in a million different directions simultaneously because of all the things that we do at the company and different ways that they all utilize economic information.

[00:04:38] Gary Bisbee, Ph.D.: Well, we’re all aware of inflation. And of course the Federal Reserve met last week, just a few days ago. Why don’t you share with us Ryan, if you could, what actually happened at that meeting and what was approved?

[00:04:53] Ryan Severino: So the Fed has a group called the Open Market Committee, and they’re the ones who are responsible for really setting monetary policy. Monetary policy, you can just think of as sort of the Fed deciding what interest rates should look like and really involved, I think to a greater extent than ever, in using capital markets to do that. So traditionally, they were just involved with really setting short term interest rates. Now they’re much more involved in capital markets to try to influence long term interest rates. But ultimately they’re really responsible for helping to set the cost of capital in the economy. And so the Fed met last week and, as you pointed out, in the context of a more inflationary environment than we’ve really seen in the last four decades in the US, to try to understand how they can adjust the cost of capital to try to keep inflation from spiraling out of control, or at least to try to tamp it down. And so, their thought on this process is, and I think most people’s thinking on this process is, as they raise interest rates, as they increase the cost of capital, they create disincentives for individuals and organizations to borrow money, which would help to try to tamp down the side of the economy, because the Fed doesn’t really have any control over the supply side. All they can really do is try to influence the demand side of the economy through raising the cost of capital. So by them meeting and raising interest rates last week, even just marginally, they start to set the economy on a course where the cost of capital is higher, the disincentives to borrowing money start to go up, and in the process, potentially even making people feel, I don’t wanna say less wealthy, but maybe slow down the rate of wealth accumulation, which also incentivizes people to go out and spend money to try to tamp down that demand side of the economy and maybe reel inflation in a little bit over the next 12, 24 months, something like that.

[00:06:46] Gary Bisbee, Ph.D.: Okay, well, as part of that decision, didn’t they basically say, for each of our next six meetings for the remainder of the year, we’re gonna raise rates a bit at each meeting?

[00:06:59] Ryan Severino: Well, that’s what they said. And I guess we kind of have to take them at face value for now, but I would say two things. Number one, the fed is very bad at following up its own forecast with actual interest rate increases. So just keep that in the back of your mind. Since they’ve really moved to telegraphing these to the extent that they can moves in advance by providing a forecast, they haven’t been very good at sticking to it. And the second thing I would say is, the Fed is doing this against a backdrop of what I would still classify as an incredibly uncertain environment. I know maybe the pandemic is not as uncertain as it was 12, 24 months ago, but we’re not out of the pandemic just yet, contrary to how people might feel about it. So that still retains an element of uncertainty that I think is beyond most people’s ability to predict at this point. And we’re dealing with a geopolitical situation that I would objectively argue is more complicated than it was just a month or two ago. And so we don’t know exactly how those things are going to play out. So I would say, yes, taking the Fed at face value, they have said they’re going to raise rates six more times this year, 25 basis points each. As to whether or not they follow through on that, I think the jury is very much out at this point.

[00:08:16] Gary Bisbee, Ph.D.: Okay. Or whether it would be 25 basis points, I suppose it might even be more, depending on how things play out.

[00:08:23] Ryan Severino: It could. And that’s why I say we’ll have to see how some of this plays out because the Fed has a tough job. And I’m not trying to, I’m not a fed hater. I’m not casting aspersions at them. But the Fed is walking a fine line between doing too little and potentially having inflation stay uncomfortably high, potentially causing serious economic problems at some point, or doing too much and actually bringing about an outright recession themselves. And so they are navigating a very narrow and difficult path between too much and too little. Amidst all of this unprecedented events that have transpired, that continue to transpire, they’re going to have to be very careful about how they walk that tight rope between too much and too little over the next 12, 24 months or so.

[00:09:11] Gary Bisbee, Ph.D.: I mean, there’s a growing view of the R word, recession. If it happens that we slip into a recession, at what point will we know?

[00:09:21] Ryan Severino: It’s always hard to say in advance. There are two things I would tell people to watch out for. The first thing I would tell people to watch out for is what’s known as an inversion of the yield curve, which basically is an environment where the yield, or the interest rate if you want to think about it that way, on short term interest bearing securities, especially Treasury instruments, are higher than longer term. That’s usually a negative signal because it means the Fed has probably gone too far, too quickly. And so as a consequence of that, usually it’s a sign in advance that we’re going to start to see a recession. Cutting through a lot of the technicalities about it, it means that the market thinks the outlook for the future is more dour than the outlook for the present, which is why the yield is lower in the future than it is today. Second thing I would tell people to watch out for, really, and I think this is a good way to think about, is pay attention to the labor market, because there are a lot of things in the economy that might or might not be telling you exactly what’s going on, but the labor market is, it’s not a perfect real time indicator, but it’s a pretty good, actually I’d say, leading indicator. It’s a pretty good leading indicator. If there is going to be trouble in the economy, you’ll almost always see it manifest in the labor market before you see it show up in metrics that most people don’t really understand in finite detail, like GDP, something like that.

[00:10:41] Gary Bisbee, Ph.D.: Well, can you describe the labor market for us now? I mean, it’s very tight, isn’t it? Seems like it’s driving inflation right now, isn’t it?

[00:10:53] Ryan Severino: It’s tight in a way that I think the average person probably doesn’t even appreciate because I think most people look at the labor market and say, oh, there are a lot of open jobs right now because of the pandemic. But that’s only partially true. I think a lot of what’s really going on in the labor market is that we’re really going through this structural demographic change in the US. As the baby boomers are exiting out of the labor force, they’re doing so faster than we’re getting new entrants into the labor force. So as a consequence of that, what’s really starting to happen is that the labor force growth rate is slowing down, despite the fact that demand for labor continues to grow along with the overall economy. And so we are in an environment right now where we have more open positions than we have people seeking to fill those positions. That’s a market change from where we’ve been for a lot of the last three to four decades. So as a consequence of that, competition for talent has intensified wage growth, really across the skill spectrum has accelerated. It’s a good time to be in the labor market if you are someone who’s working not so great if you’re someone who has to hire people, but you know, those opposite sides of the same coin for better or worse.

[00:12:03] Gary Bisbee, Ph.D.: What do you feel about the point that’s been made that there’s pent up savings because of COVID? People just weren’t out and weren’t spending money. Now things are loosening up. They’re starting to spend more money. Along the way, we’ve had government pumping money in because of COVID and all of that is creating a push toward inflation. Do you buy into that, Ryan?

[00:12:28] Ryan Severino: There’s some of that. I think, the inflation story, like a lot of things in economics, there’s a demand side of it and there is a supply side of it. The demand side of it clearly is due to the fact that you did have pent up demand because we didn’t live anything approaching our normal economic lives in almost all of 2020 and, a good part of last year as well. So consumers, I think are still, to an extent, have spent some of that pent up savings, but didn’t spend all of it. And we had massive government spending at the same time. $6 trillion of fiscal stimulus during the last two fiscal years put a lot of money in people’s pockets that, even if they didn’t go out and spend right away, a lot of consumers still went out and and spent it. And so the demand side of it clearly played an important role. I don’t wan to give short shrift to the supply side that I’m sure a lot of people have heard about because there have been disruptions to the supply side of the economy with the pandemic and there continue to be, and there will be, I think for the reasonable future. But I think a lot of what has contributed to how strong the magnitude of inflation in the United States has been because the demand side of the economy’s been so strong. Between government spending, very low interest rates, pent up savings, and a tight labor market, we are dealing at a very strong demand situation in the US, which is, I think, certainly, to blame to an extent for the inflation that we’re seeing.

[00:13:56] Gary Bisbee, Ph.D.: Yeah. Well, government spending, at least for COVID, should come way down, I would think, over the next couple of years and people, once that pent up spending is over. So maybe the demand side will settle down. That doesn’t address your point about the baby boomers turning 65 and using more services on Medicare. But it does feel like the demand side might moderate over the next couple of years. Does that make sense to you?

[00:14:25] Ryan Severino: Yeah. No guarantees in economics ever, but I almost don’t see how it doesn’t. To your point, I don’t see the appetite for the government to keep spending money the way that it did now that the most acute phases of the pandemic are behind us. So that seems like it will take some wind out of the sales of demand. I think it’s going to be very difficult to replicate the kind of spending that we saw from consumers last year. So even though I expect consumers to be a force in the economy, not as much as they were last year, interest rate are now going up as the fed starts to tighten monetary conditions. So that will take a little bit more of the wind out of the sales. And so I think it’s really those things coming together, ch,ange in fiscal policy change in monetary policy, and just, it’s like the law of compound growth. It’s just difficult to sustain a constant rate as the base gets bigger. I don’t see the contribution from spending that we saw last year being sustained, because it’s just, those kinds of growth rates are just not sustainable over any reasonable period of time. I think all of that starts to pull back on the reigns of demand as we move through this year into next year.

[00:15:34] Gary Bisbee, Ph.D.: On the supply side, which you introduced a minute ago, certainly in healthcare, everyone’s familiar with the supply difficulties. And we’ve seen everything from boats in California that can’t unload their products and so on. So there seems to be a supply issue pretty much throughout the economy. Do you see that beginning to moderate, Ryan?

[00:15:56] Ryan Severino: So, as I say to my older daughter, we live in a world of probability, not a world of certainty, but what I would say is, even with all of the things that are going on right now that we don’t have transparency on, we still don’t have full transparency on the pandemic, we think we know where it’s going, but we don’t with a hundred percent certainty. We don’t have full transparency on what’s going to happen geopolitically. I think, even with those things still creating this massive uncertainty in the economy, there’s a much better probability that, by the end of the year, the supply side of the economy’s in a better position than it is today. I think we’ve seen wave after wave of the pandemic be disruptive, but we continue to learn. We continue to adapt. We continue to figure out the things that we can and can’t do safely. And I think, especially as we start to and, not making a political statement, just statement of fact, but as we really vaccinate a lot of the rest of the world, you will see fewer disruptions than we’ve seen in the past. It was great that we were one of the first out of the gate and started vaccinating our population here. But in a very integrated global economy and a global supply chain that only gets us so far if we’re not vaccinating the people around the world who are also producing the things that we need them to produce. That said, I do think there are some constraints that stick around on a more permanent basis. As we were talking about, labor is going to be a constraint to production that we’re going to have to work through on a more permanent basis. Semiconductors are going to be hard and microchips are going to be harder to come by for a while. Not in a permanent way, but in a more durable way. And certainly I think the current geopolitical situation puts energy, I think, in focus in a way that maybe it had only started to become, I think, more on people’s radar screens with the price level running up. But a lot of that had to do with geopolitics even before we had the situation in Eastern Europe really, really start to become a more dire situation.

[00:17:55] Gary Bisbee, Ph.D.: Ryan, looking back on it, we’re not through COVID yet, as you pointed out, but just looking back on it the last couple of years, what effect did COVID have on our economy?

[00:18:07] Ryan Severino: You know, I tend to think of it as an accelerant of a lot of trends. I think that a lot of people have been jumping to, I think call it something that has explicitly caused change, but I think a lot of the changes were actually there before the pandemic, and I think it really stepped on the accelerator. So things like working from home became a grand social experiment, whether you wanted it to, or not out of necessity, I think the use of e-commerce and shopping online, even though I’m not sure I think that’s going to stay at, clearly, it’s not going to stay the levels that we saw at the height of uncertainty because we’ve already seen a decline in e-commerce, but clearly I think acceptance on the part of people in a way that, that we hadn’t seen before. And I think home ownership, in a way that a lot of people were thinking, I think somewhat mistakenly, that young people weren’t going to become homeowners and live in urban areas, being renters, I think the pandemic, I’m gonna be a little harsh when I say this, pushed people who were on the fence off of the fence very quickly. And I think all of those things were going on before this, but I think the pandemic came along and said, hey, these trends that we were kind of flirting with in the years leading up to the pandemic, there isn’t time for that anymore. You kind of have to buy the ring or move on. And so I think it really did a good job of making people decide to commit to some of these things rather than just flirt with some of these things.

[00:19:34] Gary Bisbee, Ph.D.: How about Ukraine? What is the effect on our economy to this point? Maybe not so much because it hasn’t been going on that long, but what do you foresee over the course of, let’s just say this year, that Ukraine will, what effect will it have on our economy?

[00:19:54] Ryan Severino: The most direct way the average person is going to experience this is going to be via inflation. And again, it’s not so much that I think inflation is going to stay elevated for a prolonged period of time. But in the short run, and you’ve already seen this, it does have a bit of a disruptive impact because you saw an increase in energy prices even before, I think, that shooting started in February, in anticipation of that. Since then it’s gone even higher. And I think also, because that part of the world is such an important part of food production for, in particular, a couple crops where it’s a significant percentage of exports to parts of the world, wheat and corn in particular. That’s where I think it will start to show up, I think the most directly for us in the US. Probably higher energy prices than we would’ve otherwise had at least for a while. Probably higher food prices than we would’ve otherwise had at least for a while. And I think that is where you will most directly experience it as consumers and citizens in the US. We’re somewhat removed, obviously, geographically from Europe, but also economically in a sense that we are the major oil producer in the world and we could produce more if we really needed to. And we are one of the dominant food producers in the world and exporters in the world. We do have the ability to rely, I think in a way, on domestic food production in a way that a lot of other countries around the world don’t. We’re not immune to what’s going on in that part of the world, but we are certainly much more insulated to the extent that you’ll probably see it manifest in somewhat higher inflation for a while, but probably not the way you’re going to see more serious disruptions, unfortunately, in some other parts of the world.

[00:21:36] Gary Bisbee, Ph.D.: Another question that people have is the US debt. And given the rising interest rates, is that gonna be not a problem going forward, the paying off the debt that we’ve incurred?

[00:21:50] Ryan Severino: It sort of depends on your timeframe. In the short run, probably not. We’re not at levels where it really starts to become a serious headwind for economic growth, but it’s hard to play this game, ad infinitum, even for the United States where the dollar remains the world’s reserve currency. In the short to medium run, probably not the kind of disruption to the economy that I think anybody’s even going to notice, if at all. In the medium to long run though, at some point, we can’t keep growing debt faster than the overall economy. At some point, that’s going to become a more serious challenge. The problem is understanding where that break point is. And the empirical research is kind of useful on this, but it’s not hard and fast rules that we can follow. I think if anything, what will probably happen with the pandemic and the excess extra borrowing that we were talking about, is it probably pulls that break point forward in time, doesn’t push it farther off in time, because, as we were talking about before, we are going through demo demographic change in the US and that’s a big part of why we’re having these issues. Because we are an older society than we’ve ever been, we have more people who are drawing on Social Security in a way that we’ve never had before. More people are drawing on Medicare in a way that we’ve never had before. And, at least up until recent years, longevity, life expectancy, keeps going up, which means those people are drawing on the system longer than they have historically. And so, and I’m not taking a stance for against any of that, I’m simply saying when you do the math and you have an older society where you have more people drawing on the system for longer than they have historically, that puts a lot of burden on the people who are working and paying into that system who are responsible for funding it at any particular point in time. And I know it’s not as if it’s dollars in, dollars out directly. I’m simply saying the burden on the people paying into the system is going up as you have more people drawing on the system relative to the number of people who are paying into the system. And that is something we’re going to have to really confront at some point if things keep trending the way that they’ve been trending for the last 2, 3, 4 decades.

[00:24:04] Gary Bisbee, Ph.D.: Yep. Feels like that for sure. Another question, Ryan, that people are interested in is AI and machine learning. And in healthcare, we look at it in administrative terms or clinical terms, but how do you look at it from the standpoint of the economy? Do you expect AI and machine learning to actually have an impact on our economy going forward?

[00:24:28] Ryan Severino: I think it almost has to and it goes back to what we were saying about the labor shortage. In a world where we can’t clone people, or we can’t just, you know, grow them like in The Matrix, you know, assuming that we’re not already likely plugged into the Matrix and kind of ignorant of it, we’re going to have to do something else in order to grow the economy. And the other way we can grow the economy is by being more productive. Each of us as workers can produce more per hour. And one of the best ways to do that is to invest in the kind of technology that makes us more productive. And I know that there’s this kind of popular wisdom out there, conventional wisdom, that says technology is this job destroying juggernaut that’s going to come along and take all of our jobs away. And I can see that technology does. destroy jobs over time. I mean, there are positions that just don’t exist today that that existed generations ago. But it also creates jobs in the process. And I think what’s interesting for those of us who work in services, technology is really good at making us more productive. I would have a much more difficult time doing my job today than I would a generation or two ago. I’m sure I could say the same of healthcare professionals with all of the technology that exists today, how, how advanced different forms of MRIs have gotten over decades as opposed to what was available 60, 70, 80, 90 years ago. And so I think of it as, A, it’s a necessity because we’re not going to be able to just hire more people, to keep growing the economy. B, it is going to make us more productive in the process. And C, it’s a really good way to actually incentivize, I think, investment and innovation in a way that, I think if you start to think of it more as not something that goes out and explicitly destroys jobs, but changes the economy for the better in the long run, with the caveat that they’re always going to be winners and losers in, in that process, then I think that’s the important way to think about it. So I don’t see how we don’t have that kind of technological investment and utilization. I almost think the parts of society and the economy that aren’t going to be impacted by it, if there are any, will be small relative to the percentage of the economy that is going to be impacted by it.

[00:26:43] Gary Bisbee, Ph.D.: That’s a great way to put it. Let me ask a question, Ryan, about the healthcare sector versus other sectors of the economy. And you know a lot about healthcare, probably more than you ever wanted to know, but you know a lot about healthcare. How do you compare the healthcare sector versus other sectors of the economy?

[00:27:03] Ryan Severino: In that sense. I almost think the healthcare sector is going to have to rely on it maybe more than other sectors. And I’m not trying to scare anybody. Again, I see it as an opportunity. But when you think about healthcare, you mentioned it, it’s such a huge part of our GDP. But also when you think about the people providing healthcare, moreso than almost any other occupation, they are very highly trained and specialized. The human capital that goes into taking care of people is, it’s incredible in ways I think that the average person can’t possibly comprehend. And I emphasize that because, if you think it’s hard to go out and hire people to be accountants and financial analysts and paralegals, go out and try to hire doctors, right, especially specialists who have to go through internships and residencies and very specialized training even on down to nurse practitioners. This is not a plug and play kind of solution. It takes years of education and experience to be able to actually care for people. Not surprisingly, it’s not something that even, I think, intelligent, diligent people often want to go into. You really have to have that desire to really want to care for people and understand how you can do that as a professional. And so to me, I think that is an area of the economy where they will almost have to rely on technology to help them because it’s not easy to just come up with, you know, new doctors and nurses and nurse practitioners. It’s going to be a challenge because a lot of the rest of the world faces the same demographic situation. And when you think about the quality of the training, that has to go into that, there’s a certain minimal level that has to go into that. Again, this isn’t like, and I’m not trying to belittle this, but I’m not sure that I want, you know, my brain surgeon to have gotten their medical degree online, you know, practicing, you know, digitally. Maybe at some point, the technology will help them, but I think most people want their doctors to have been in physical classrooms, taught by other doctors, you know, practicing under strict supervision before they get to the point where they’re starting to perform surgeries or take care of people. And so I think that’s where there’s a tremendous opportunity for technology to have a huge impact on the healthcare sector in the US.

[00:29:27] Gary Bisbee, Ph.D.: This has been a terrific interview, Ryan. Why don’t we learn a little bit more about you? I know our audience would be fascinated with your background. Let’s kick that off with, what was your life like growing up?

[00:29:39] Ryan Severino: You know, I think, in many respects, it’s fairly typical like American childhood. I came from kind of a, you know, working class blue collar background, the way a lot of people do. And so, I grew up in New Jersey, in the, almost literally in the shadow of Manhattan. And so I, grew up at a time when Manhattan was still kind of a dirty, dangerous place, when I wasn’t always honest with my parents about where I was going sometimes

[00:30:05] Gary Bisbee, Ph.D.: You don’t to go far down that path, Ryan.

[00:30:09] Ryan Severino: They would not have been, always excited about knowing what I was doing and where I was going. You know, I didn’t get arrested or do anything untoward, but I was fortunate in that sense, because I did have in many respects, I had a great family and a very, in some respects, a typical American childhood, but also the opportunity to go into Manhattan, one of the most important cities in the worldm in a way that I think is probably somewhat incongruous with my family’s background. My parents never went into New York. They didn’t particularly like New York. But I got exposed to it at a young age because I had easy access to it with my friends and we went out and we did things that, that the average you know, 15 year old American kid couldn’t do. And I think that exposed me, not just to a big city, but made me appreciate that there was so much more to the world than just the town I grew up in or the surrounding towns. And it really, for the first time, exposed me to the idea that there’s a much bigger, wider world than just sort of your parochial life growing up.

[00:31:06] Gary Bisbee, Ph.D.: So your undergrad degree was from Georgetown, your master’s from Columbia in New York, of course. You’ve studied both economics and finance and you’ve worked in both economics and fiance. How did you end up making a decision to become a chief economist?

[00:31:23] Ryan Severino: It was kind of a grand accident, but I say grand accident because there was some logic to it. It’s funny. You mentioned undergrad. I went to school where I did, in Georgetown and DC specifically because, despite going to kind of a run of the mill, blue collar, middle class high school, we actually had a Japanese teacher. And so I thought, boy, I don’t wanna look like every other kid from New Jersey trying to get into the same 15, 20 universities. I should study this and do something about it. And again, it’s sort of being exposed to New York, I think, was probably part of that process. I studied Japanese in high school. I was an exchange student. I lived in Japan for a while. And so I thought, I wanna do something with my career that pertains to Japan. So I explicitly went to the university that I did in the city that I did thinking about that. If you look back at the last 30 years of Japanese economics, it hasn’t really been conducive to that. And so once I found the opportunities more limited than I thought they were going to be when I first started studying Japanese and I fell in love with it, I thought, alright, well, what else do I like? What else am I good at? And what can I do with that? I say this without any pride, necessarily. I’ve always been a good student. I’ve always been good at mathematics. Whether that’s fate, luck, karma, genetics, divine intervention, whatever we want to ascribe it to, I’ve always been very strong in mathematics and I’ve always enjoyed it. And I thought, okay, I don’t envision myself as a mathematician. What do I like that utilizes mathematics? And I really like economics and I really liked finance. I’ve just increasingly found myself becoming kind of more technical and nerdier over time. I fell into real estate by accident. I ended up really liking it, but increasingly I’ve found myself in more technical positions where I could utilize my skillset in mathematics and in programming. And it just, you know, at some point I stopped swimming upstream, and I said, if the shoe fits, I should wear it. And so I found this kind of niche in the commercial real estate world where I’m not like the average person who’s out wheeling and dealing all the time. I’m mostly sitting around reading, writing programs, crunching numbers. As I said earlier, I’m trying to think about what’s going on big picture in the world and understand what the implications of that are for all of us living our daily lives, but then all of us who have to utilize real estate, which is most people in the world, especially people in the developed world.

[00:33:50] Gary Bisbee, Ph.D.: As I mentioned, you’re adjunct faculty at Columbia and NYU. Did you ever think about a full-time faculty role, Ryan?

[00:33:58] Ryan Severino: You know, Gary, if I could go back and have a conversation with my 19, 20 year old self, that’s probably what I would’ve done, controlling for my personal life because there’s nothing I would trade to, to alter anything about my personal life. But, that not withstanding, in a different world, I would’ve been a full-time professor. I toy with the idea sometimes, in quasi retirement, maybe thinking about that. I don’t think I will want to work in an office ad infinitum, if that’s even possible with science and medicine someday, but I will teach as long as I can. I enjoy it in a way that’s above and beyond anything that either of those universities are paying me, you know, the satisfaction that I derive from helping other people, being able to influence their lives, maybe getting them to think about a career in a way that they otherwise wouldn’t have. I look at it this way. It’s hard for me to pay back my teachers who served me. So I am a byproduct of so much, including the teachers that I was able to study under. I can’t explicitly pay them back. So I think, can I pay that forward to someone else and maybe make a difference in their lives? The way that my elementary school teachers, my middle school teachers, my high school teachers, my undergrad teachers, my graduate school teachers, my mentors in the real world, and then obviously, my parents, my family have all been teachers on some level at some point. I can pay some of them back, but I can’t pay all of them back. That’s how I think about it. If I can’t pay it back to them, I do my best to pay it forward to someone else and then maybe make a difference in their lives the way somebody’s made a difference in, clearly made a difference in mine.

[00:35:37] Gary Bisbee, Ph.D.: Well, that’s just a very cool sentiment, Ryan. Very cool. This has been a great interview, as I said before. I’ve got two questions remaining, if we could. Both of them involve asking you about advice .The first one is, for a young person that might be interested in that economics as a career, what kind of advice would you give them?

[00:36:00] Ryan Severino: My best advice is to study as much mathematics and computer programming, especially statistical computer programming, as you can. Even, if you don’t think you wanna become an economist per se, because the world is becoming more technological, more digitally oriented, where you’re starting to quantify almost literally everything that we can, all of that’s going to be analyzed by someone. And so the better you understand the mathematics of it, the better you understand how the computers are looking at it, again, whether you want to do that explicitly yourself or not, it will really help you understand how the overall economy works. And when somebody comes out and makes a forecast about the economy or some aspect of the economy, you’ll have insight into it that the average person doesn’t have. So I’d say, in addition to studying as much economics as you can, my best advice is to understand the more technical aspects of it because it’s almost impossible to understand the economy without understanding the math of the economy. And increasingly, we have to use computers to do that because there’s just too much data these days. There’s been too much data for 50, 60, 70 years, but especially these days, there’s just too much data to ever try to sift through it and understand it without utilizing a computer to do it.

[00:37:12] Gary Bisbee, Ph.D.: What advice would you have for up and coming leaders? Just general advice.

[00:37:16] Ryan Severino: I think my general advice would be to be as adaptable about the world as you can. And it dovetails a little bit with what I was saying about my own career. Like I said, I went to Georgetown to be in DC to do some kind of, I don’t know what I thought I was going to do, US/Japan business diplomacy, something like that. And when that didn’t work out as well as I’d hoped, I wasn’t defeatist about it. I said, okay, like, well, what else do I like, what else can I do well that I could turn into a career? And I think a lot of people, I don’t wanna say that they’re not resilient, but I think a lot of people get hung up on something. And when that doesn’t pan out, they have a hard time being flexible and adapting. So I would say to people, be as adaptable as possible. The world is changing, probably in some respects faster than it ever has. People are probably going to have to be constant learners throughout their career. They might have to retrain for different careers or positions throughout the entirety of one career. Don’t be inflexible. Try to be as flexible and as adaptable about your life, about your career, as possible. In a world where change is accelerating, I don’t even wanna make it sound like it’s going to be a luxury for young leaders. It’s probably going to be a necessity for young leaders over the next 50, 75, 100 years and beyond. So to the extent that people can be flexible and adaptable and be constant learners, they will serve themselves really well, not just in their careers, but I think in their lives, in addition to how well I think it will serve them in their careers.

[00:38:44] Gary Bisbee, Ph.D.: That’s excellent advice, Ryan. Thank you so much for being with us. We really appreciate your time.

[00:38:50] Ryan Severino: No, thanks for having me, Gary. This has been great.

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