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Prices Will Come Under Significant Pressure If Everyone Heads For The Exit At The Same Time

A report from CNBC. “The Federal Reserve now owns more than a third of the agency mortgage-backed securities, or MBS market. At the start of 2019, the Fed held $1.6 trillion in agency MBS. It tapered that down to $1.37 trillion by mid-March of 2020. Then, when the economy and housing market were suddenly in Covid free fall, the central bank began buying more again. As of last week, the Fed held $2.2 trillion of agency MBS. ‘They’ve continued on autopilot. I don’t think there’s been any discussion within the Fed. The Fed is just afraid to change because they don’t want it to be seen as a form of taking their foot off the pedal,’ said Peter Boockvar, chief investment officer at Bleakley Advisory Group.”

From Market Watch. “Wall Street’s comeback story in U.S. housing finance has hinged on lending to self-employed borrowers and others who don’t quite fit the mold. It financed millions of homes in recent years using alternative forms of documentation to gauge a borrower’s ability to afford a mortgage. But the small but important corner of housing finance referred to as the ‘non-qualified mortgage’ (non-QM) segment has impairments that remain stubbornly high when compared with the rest of the U.S. housing market.”

“‘You really have self-employed borrowers struggling from day one,’ said Vadim Verkhoglyad, an analyst at dv01, of the pandemic setting off a deluge of late payments and loan modifications. ‘Investor loans struggle because so many tenants aren’t paying rent,’ he said of another key area of stress.”

“Therein lies the hitch of the non-QM borrower, someone with good credit akin to Wall Street’s ‘Alt-A’ category, before standards collapsed in the run-up to the 2008 global financial crisis. ‘It’s like a jungle,’ said Caroline Chen, a senior research analyst at Income Research + Management in Boston, about the hodgepodge of loan types and borrowers in the non-QM group. ‘They all have some story behind them. Some are self-employed borrowers who can’t provide full documentation,’ Chen said, referring to the standard two years of W2s and tax returns often required for a conventional mortgage, as well as other proof of income, assets and debts.”

From WTBW in South Carolina. “Eric Michaels has owned his property at Grand Strand Resorts III since 2006. Michaels says he’s been leasing the home since 2010. Michaels said the tenant’s lease ended in January, but are still living in the home rent free. His bank is offering forbearance on his loan, but says if the back pay isn’t paid in full by September, he could lose the property. Michaels said other landlords are in similar situations. ‘I think in the long haul it’s going to cause more foreclosures and financial duress,’ Michaels said.”

From ABC 7 New York. “Some small landlords on Long Island are facing foreclosure and bankruptcy due to non-payment of rent from their tenants during the pandemic, Eyewitness News has learned. ‘The people that are being hurt are these mom and pop landlords,’ said Long Island real estate attorney John Lynch. ‘I have clients who now can’t pay their mortgages and are in danger of being foreclosed upon.'”

“In June 2019, Louis DiPasquale, of Westhampton Beach, rented out the home he bought for his son in Sound Beach because his son was being deployed with the Army to Cuba. DiPasquale said the last full rent payment he received from the tenant was in January 2020. He said the tenant paid only $1,100 of the $2,150 rent in February. He moved to evict her in March 2020, but the courts closed due to the pandemic.”

“DiPasquale said he is out $32,000. His son is back from deployment and can’t return to the house. ‘My son would be homeless right now if he couldn’t come live with us,’ he said. ‘I just want my house back.'”

The Davis Vanguard in California. “Someone shared with me a CoStar Analytics report that looked at Davis’ retail vacancy rate compared to the Sacramento average. It shows the retail vacancy rate, which had been under 4 percent from 2012 until 2017, soaring to over 8 percent—the first time it passed the regional average in at least a decade. ‘Apartment vacancies in Davis have similarly soared to an all-time high, indicating students have opted to live with family, cohabitate with friends, or live in a more cost-effective area. Davis’ apartment market is easily the most expensive in Sacramento,’ they note.”

From ABC on California. “Vacant office space in San Francisco has skyrocketed during the coronavirus pandemic. Now, there’s a question of whether or not some of that available space can or should be converted into residential units. The San Francisco Chronicle reports the amount of office space up for lease in the city now could fill 11 Salesforce Towers. That’s compounded by recent plummeting rents on residential units in the city and across the Bay Area. New data from rental listings website Zumper shows median rent for a one-bedroom unit in San Francisco is down 24% from a year ago, though it is still the highest in the U.S. among big cities.”

“Rent also has fallen 20% year over year in San Jose and about 18% in Oakland. Other Silicon Valley cities such as Sunnyvale (-32%), Santa Clara (-29%) and Redwood City (-29%) are seeing even larger declines.”

The West Island Blog in Canada. “An amazing promotion listing an apartment near Concordia University’s downtown Montreal is among outstanding adverts that stood out on the Rentals.ca website. According to Paul Danison, the website content director, the promotion offered tickets for sky diving, free helicopter rides, and a two-month free rent. The Rentals.ca team says that the incentives started six months ago and include rentals in Montreal and Toronto.”

“Danison says that the landlord’s time is over, and it is now the tenant’s market. ‘It used to be a pretty market where the landlords were in control, its tenants’ market right now, and landlords are competing for the best tenants.'”

The New Straits Times on Malaysia. “Since 2019, the property market has been flooded with auction units spanning from Kuala Lumpur to Johor Baru. According to property agents, 4,000 to 6,000 units of properties are flooding the market every year. Some units still fail to be sold off despite five or six rounds of price reduction. I came across one apartment in Puchong, Selangor, that went through almost 10 rounds of price reduction before it could be sold off.”

“To put this into perspective, every reduction usually amounts to 10 per cent off the previous price. The heaviest consequence is faced by property owners, whose dream-come-true moment of purchasing a new property ends in a nightmare. Additionally, the number of auctions is not just high, but has surged to a new level, turning individual purchasers’ nightmare into a nationwide one.”

“I say so because property purchase is typically the biggest life decision for most people. As such, a wrong decision will definitely entail consequences severe enough to ruin one’s family and even nation. Worse still, property transactions are gearing base, meaning that almost all transactions are sealed via bank borrowing by the purchaser. Therefore, a plunge in property prices not only erodes owners’ wealth, but pushes the borrower into limbo as well. If momentum builds in this direction, banks will encounter plenty of non-performing loans, jeopardising their balance sheet.”

“A few years ago, a young individual (A), in his 30s, bought a luxury apartment unit at a staggering price of RM900,000 for 775 sq ft — approximately RM1,161.29 per square foot. This pricing rate in Cyberjaya is shocking, but what is even more alarming is that there were many more properties launched at the time with such prices. Purchasers were still bullish in their outlook despite sky-rocketing prices. Unsurprisingly, these property purchasers’ bullish stance has turned into a catastrophe, particularly in the last two years. To illustrate, A had secured a loan for RM800,000, equivalent to approximately a RM4,000 monthly loan installment.”

“However, the market rental price could only stretch up to RM1,500 a month for that unit. Expectedly, after three years, A was unable to serve the loan commitment. In 2020, A’s unit was auctioned off at a mere RM265,000. In conclusion, A did not just lose the apartment unit through the forced auction sale, but has also slumped into outstanding debt of around RM500,000 that will impact his life. Certainly, this case depicts only the tip of the gargantuan iceberg that is the property market.”

“Two questions stand out in my mind. How were developers possibly allowed to sell at outrageous prices? How did banks allow such high valuations?”

From Good Returns New Zealand. “BNZ chief economist Stephen Toplis says it should come as no surprise the Government’s patience has been exhausted and a full attack on prices is underway. ‘Whether the measures will have the desired impact or not is neither here nor there. If this set of policies fails then more will be introduced as the Government cannot be seen to fail. The Government has now fully exposed its intention to do what it takes in terms of moderating house price inflation. It will almost certainly win in the end.'”

“In contrast, the fundamentals of true demand and supply have actually been going the ‘wrong way,’ says Toplis. Thanks to Covid, population growth has plummeted alongside the slump in net migration. The increase in demand for housing is way less than expected. Even when borders do reopen it is unlikely the shortfall in demand generated will be quickly reversed, he says.”

“‘But while true demand has been much less than anticipated the pace of housing construction has accelerated beyond expectations,’ he says. ‘Right now, one new house is probably being built for every one person increase in population. This is clearly not sustainable.'”

“The risk is that no government, or central bank for that matter, has ever been able to fine tune an asset market so the balance of risk is that a decent correction in prices occurs. For all but new buyers this matters little as it will simply reverse some of the recent exceptional capital gains.”

“Independent economist Tony Alexander says from a new investor’s point of view before the new policies it meant if buying a property delivering $20,000 per annum in rent, financed with debt costing $15,000 in interest, then ignoring all other costs, taxable income would have been $5,000. The tax bill would be $1,650 at 33% and the investment would be cash flow positive.”

“Now, tax will be levied on the entire $20,000 of revenue delivering a tax bill of $6,600. The tax bill goes up $4,950 and the property is now cash flow negative. ‘The returns to investing in residential property have altered – not just for the 24% of people purchasing investment property with a mortgage, but many of the 12% who pay cash. They would pay cash having raised debt on other properties they own in many instances. That debt will eventually be affected,’ says Alexander.”

“To put the coming price declines of uncertain magnitude in context – prices in February on average were ahead 25% from May and 21% from a year earlier. If prices on average now fall 10%, they will go back to where they were in October. If they fall 5%, they will be back to where they were in the first few days of February and 15% takes them back to August last year.”

“The possibility of a substantial correction is multiplied, says Toplis, if the potential oversupply diagnosis and new policies have a substantial negative impact on sentiment. ‘House prices will come under significant pressure if everyone heads for the exit at the same time.'”

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This Post Has 132 Comments

  1. ‘Some are self-employed borrowers who can’t provide full documentation,’ Chen said, referring to the standard two years of W2s and tax returns often required for a conventional mortgage, as well as other proof of income, assets and debts’

    Ahem…

      1. “…Those baseball card collections should count as assets!…”

        Especially if those cards don’t really exist, but only a binary file locked to non-fungible token (NFT)

        So why not extend the concept to housing? I will sell you a binary mega-mansion for only $5mm. Housing “shortage” solved! Think of it, no lawns to mow, no roofs to replace, just a wonderful series of dots to stare at and enjoy on your computer screen.

  2. ‘Purchasers were still bullish in their outlook despite sky-rocketing prices. Unsurprisingly, these property purchasers’ bullish stance has turned into a catastrophe, particularly in the last two years’

    There shouldn’t be bulls and bears with housing. If there is you end up with A. Malaysia is a good example of QE being deflationary. For many years it was well known they were building way too much (at a terrible human and environmental cost BTW, so much for globalist climate change horsesh$t).

    But on they go. Probably turning out hundreds of thousands of new unsold airboxes as I type.

  4. ‘Two questions stand out in my mind. How were developers possibly allowed to sell at outrageous prices? How did banks allow such high valuations?’

    ‘The risk is that no government, or central bank for that matter, has ever been able to fine tune an asset market so the balance of risk is that a decent correction in prices occurs’

    Central bankers (and their guberment stooges) are dangerous idiots.

  5. ‘the promotion offered tickets for sky diving, free helicopter rides, and a two-month free rent’

    Ooo, I know, free skydiving out of helicopters. That’s the spirit!

  6. ‘To put the coming price declines of uncertain magnitude in context – prices in February on average were ahead 25% from May and 21% from a year earlier. If prices on average now fall 10%, they will go back to where they were in October. If they fall 5%, they will be back to where they were in the first few days of February and 15% takes them back to August last year’

    I’ve been sayin’ for a while: can all these experts not see double digit price increases are insane? Yet the media is shouting “hurrah” and stampeding weak minded fools into this buzz saw. It’s either not true, an indication of widespread appraisal and mortgage fraud, or some combination. And here we see market watch straight out admit it’s fraud. No documentation, no income, which I found years ago. Recently I posted a report about loans for unemployed – now that’s sound lending!

    2. i check in on occasionally on various ‘investor’ forums (biggerpockets etc). No matter how analytical they seem, it seems not to be the actual investors —– but basically the middle men (mortgage brokers) etc, that have figured out ‘approaches’ to get the loan approved for these investors.

      There is no way out – either the property keeps appreciating, or they are in a world of hurt.

    3. “…here we see market watch straight out admit it’s fraud.”

      …while continually cheerleading high rates of home price appreciation.

    4. Speaking locally, homes like the one our landlord sold in fall 2019, just before the COVID-19 Quantitative Easing measures kicked in, are currently selling for 35% higher than when they cashed in on their 2004 investment.

      They made next to nothing after HODLing costs, thanks to bad luck of timing!

    1. SF Gate — ‘I’ve never owed this much money’: The real-life depths of Bay Area debt (3/30/2021):

      “In the United States — and in the Bay Area — debt has ballooned into a near-universal experience. If you don’t have it, you know someone who does. The pandemic brought debt to the forefront of local and national discussions. About student loans, the $1.7 trillion bubble that everyone knows is about to burst. About medical debt, which has led to a cottage industry of GoFundMe pages and, worse, scares people out of seeking healthcare in the first place. About back rent owed to landlords who will try to kick you out of your home even when they’re not allowed to do so.”

      https://www.sfgate.com/local/article/bay-area-debt-package-16061425.php

      A near-universal experience? I have ZERO debt.

      Bay Aryans you’re getting exactly what you voted for, and ZERO sympathy from me. The government you elected did this to you, not an alleged pandemic disease with a 99.98% survival rate.

      1. “I have ZERO debt.”

        So you have imputed income, which means you’ll be tapped to bail-out these “debt donkeys.”

        1. This is why certain technocrats are starting to talk about wealth tax. So even if you have saved up, and now have less income, they need to be able to get tax $s.
          So you have imputed income, which means you’ll be tapped to bail-out these “debt donkeys.”

        2. Imputed rent has always seemed odd to me:

          “Let’s say you’re renting an apartment for $2,000 a month. To your landlord, your rent checks are considered income, and she pays tax on it. Then you decide to buy a home of your own. Turns out it’s pretty similar to the one you were renting, but it’s all yours. Imputed rent is based on the logic that instead of paying your landlord, you’re now paying yourself that $24,000 a year.

          In the Netherlands that effective income is taxable; in the US it is not.

          But if the BEA left out imputed rent — all that money homeowners are not paying to landlords — a little over a trillion dollars would vanish from the national income, Browns said. That’s roughly equivalent to what the country spends on healthcare.”

          https://www.businessinsider.com/imputed-rent-hidden-tax-break-homeowners-2016-9

          1. In the Netherlands that effective income is taxable; in the US it is not.

            In other words, a wealth tax.

            Collectivism works great until you run out of other people’s money.

      2. ‘The government you elected did this to you’

        Not exactly. CA is the land of vested interests. The state motto should be changed from ‘The Golden State’ to something more along the lines of ‘Bleeding the new comers since 1849.’ By the time they figure it out, they’ll be back home in their parents’ basement in Cleveland with MT pockets and 10 years of wear and tear on their bodies. If you come away with good tech experience it can be sorta worth it. Otherwise, just 10 years older and MT pockets. But the sunshine is nice (if you don’t live in San Mateo or SF).

        1. It’s very hard for newcomers to survive the fleecing operations which begin upon entering the so-called Golden State. I knew that when we first drove across the border in 1996, only to have all the fresh fruit in our car confiscated, supposedly because it might have infested California orchards with some kind of dreaded pest. Shortly thereafter, we were charged a hefty emissions fee for our car, despite it having passed the CA smog test with flying colors.

          A couple of decades later, and short by $10k’s of state income tax payments to help fund unemployment benefit payments to prisoners and other dubious state government programs, I have to wonder if all the sunshine is worth it.

      3. “A near-universal experience? I have ZERO debt.”

        Those of us who have successfully avoided voluntarily placing a mortgage noose around our necks are certainly the oddballs!

  9. ‘Shares in Deliveroo plunged by as much as 30% in their trading debut on Wednesday, slicing more than 2 billion pounds off the company’s valuation in a blow to Britain’s ambitions to attract fast-growing tech companies to the London market.’

    ‘The highly-anticipated listing, the biggest on the London market in a decade, had been hailed by British finance minister Rishi Sunak as a “true British tech success story” that could clear the way for more initial public offerings (IPO) by technology companies.’

    ‘But the debut had already been overshadowed as some of Britain’s biggest investment companies shunned the listing, citing concerns about gig-economy working conditions and the share structure.’

    ‘Fabian de Smet, head of investment banking at Berenberg, called it a “sector problem”. “Investors are turning away from the work-at-home play and putting their money into the economic recovery play. Deliveroo got caught in the middle of a huge rotation. It was the last IPO of the old COVID world,” he said.’

    ‘Deliveroo’s self-employed drivers have seen a boom in demand during the pandemic, bringing food from otherwise-shuttered restaurants to house-bound customers. But the Amazon-backed company has been running at a hefty loss; it said it narrowed an underlying loss to 223.7 million pounds ($308.93 million), from 317.3 million pounds in 2019.’

    ‘One trader, speaking on condition of anonymity, told Reuters he had seen no buyers for the stock at 1000 GMT.’

    https://www.theglobeandmail.com/investing/investment-ideas/article-deliveroo-dives-30-as-londons-debut-of-the-decade-turns-torrid/

    “They’re renting f****g desks!”

    3. A bunch of dudes with bicycles who deliver restaurant and fast food in London is not a tech firm.

    4. “true British tech success story”

      If the CEO wears a turtle neck and a Bluetooth earbud w/mic then it’s a tech company.

  10. He should be happy he got half of February 2020 rent. Jeez. The government will decide when his tenant is well enough off to leave. Maybe we should move that eviction ban to 2022 to really teach him a lesson.

    1. This is before all the eviction moratoriums went into effect. I bet they got $0 after that. But yer mistake was to gamble on a shack for yer son when he going on deployment. I guess it was still cheaper than having him rent when he came back! Oh, don’t foget yer brought in socialist sh*thole that view landlord as evil people and don’t give a damn about property rights.

    2. we should move that eviction ban to 2022 to really teach him a lesson.
      I could see some states moving the eviction Moratorium to September. And then how long is it going to take to get the eviction cases through the court system? Then, Damn, it is Christmas so no evictions over Christmas (actually happened to a landlord friend of mine in the 1990’s in Illinois). Next thing you know and free rent until 2022.

      1. Next thing you know and free rent until 2022.

        I wouldn’t be surprised if a deal is made to take the mortgaged properties off of owners hands in exchange for forgiving them the interest owed. Then they will be permanently free, and millions of voters will be cemented for the Dems.

  11. The Hill — Battle rages over vaccine passports (3/31/2021):

    “Florida Gov. Ron DeSantis (R) has urged his state’s GOP-controlled legislature to pass a law forbidding passes showing proof of vaccination, while vowing to take executive action. Congressional Republicans have similarly slammed the passports, framing them as invasive.

    Supporters of the idea say it will help boost businesses — especially in hard-hit industries like travel and entertainment — as COVID-19 restrictions are scaled back and more Americans receive vaccines.

    IBM is in talks with “just about every state” and federal agencies about such passes.”

    https://thehill.com/policy/healthcare/545670-battle-rages-over-vaccine-passports

    “IBM knowingly organized all six phases of the Holocaust: identification, exclusion, confiscation, ghettoization, deportation, and even extermination”

    https://blogs.timesofisrael.com/ibm-and-the-holocaust-20-years-of-corporate-denial/

    1. This is a bedwetting article from the Washington Post (3/30/2021):

      “The issue has received an increasing amount of attention from some of the party’s most extreme members and conservative media figures, but it has also been seized on by Republican leaders like Florida Gov. Ron DeSantis, who is considered a potential 2024 presidential candidate.

      “We are not supporting doing any vaccine passports in the state of Florida,” DeSantis said Monday. “It’s completely unacceptable for either the government or the private sector to impose upon you the requirement that you show proof of vaccine to just simply be able to participate in normal society.”

      Other Republicans have used more inflammatory rhetoric, with Rep. Marjorie Taylor Greene (R-Ga.) calling the passport idea “Biden’s Mark of the Beast” and some conservative activists comparing it with Nazi policies to identify Jews.”

      https://archive.is/eYNdU

      I heard some audio of Governor DeSantis talking about this. When was the last time you heard any member of the Democrat Party say the word “freedom” or “liberty?”

      1. This is a comment from the /r/coronavirus sub-reddit:

        “Because the lack of a mask mandate, or any real effort to stem the spread, there is no way to know if that person next to you is vaccinated or not. They could be an asymptomatic carrier, spreading the disease. The passport, would allow businesses to either refuse to admit a person(s) or seat them in a separate area. Lacking that people will continue to pass the disease.”

        A separate area? How about seating them IN THE BACK OF THE BUS. I hear that was a thing back in the day.

        Note that this post got 10 upvotes.

        1. there is no way to know if that person next to you is vaccinated or not.

          Last I heard the vaccinated still need to wear masks and practice social distancing.

        2. there is no way to know if that person next to you is vaccinated or not. They could be an asymptomatic carrier, spreading the disease.

          Which is why YOU get YOUR vaccination, dummy.* Within a couple months we’ll have the vaccinated or recovered population spreading** this disease to other vaccinated people, who might be “infected”*** but won’t develop any symptoms. And in a couple years, people who chose not to be vaccinated will get the disease, recover or die, and then also spread** it to a bunch of vaccinated or recovered people, who will still not develop symptoms. Soon, NO ONE will have symptoms and we go on just as before. No mandates or passports needed.

          —————-
          *I don’t mean you, DePlob, I’m addressing the guy who wrote the comment. And I’m probably addressing the c__ts and the CDC as well.
          ** Didja notice how nobody wants to definitively say whether vaccinated people are carriers? Moderna found 75% less virus in vaxxed people, i.e. no spread, but the CDC deliberately tossed that into the memory hole. Can’t interrupt the narrative.
          *** They’re playing fast and loose with the word “infected.” Infection means, what? That a virus invaded 100 of my 40 trillion cells, which were immediately targeted and destroyed? No symptoms, no harm. I’m probably “infected” with measles and polio every month or so.

          2. If you can get one.

            In typical fashion, San Diego is going from almost nobody eligible for a vaccination to everyone eligible over a two week period. And since the vaccine is “free”, there are no appointments open, anywhere.

          3. I did take a recess, but I’ll resurface for a bit.

            “If you can get one.” — which is why I keep saying hang until July 4. By then we’ll have enough supply so that everyone can get a jab and no one will have an excuse. Finding people to do the injection might take longer.

            Marketwatch has another crappy headline: “UPDATE: Fauci says vaccines are offering protection against new, more infectious COVID variants” Then they cite a paper describing that people who had the virus naturally show T-cell immunity. Wait, that’s not vaccinated people, that’s people who were exposed to the whole virus and not a piece of it. Then they wiggled by saying “and most likely those who got the vaccine.” And I’m supposed to believe “the science.” 🙄 For even more fun, a couple hours ago the original headline said “authorized vaccines” not just “vaccines.” Remember, Astra-Zeneca does NOT protect against the SA variant, but it’s not an authorized vaccine in the US. The authorized vaccines: Pfizer, Moderna, J&J do offer some protection against SA. Fauci is being sneaky, but at least the headline quoted him accurately. The updated headline is misinformation.

          4. “If you can get one.”

            I made an appointment on-line, and they requested health insurance information if available to help defray the labor costs involved. The station location was remote, but I’m in fly-over country. Group 1B, Pfizer’s 1st.

            Vaccination Station
            https://imgur.com/a/E95U2Vu

          5. The Narrative is that we will need a “booster” every year to protect us from the mutations.

      1. I’ll get it once and one time only because it’s a component of Governor Polis’ metrics for reopening the Colorado economy. Vaccine passport, never.

        I’ve accepted that live music events are probably over for me, forever. I don’t go on cruises and since I don’t need to fly for work, I may never fly again.

        1. To not have cruise ship shuffleboard well into your golden years might be a deal breaker…decisions decisions.

        2. It looks increasingly likely that I will need the vax certificate to cross the border into Canada. We do not live in a logical world.

        3. I’ll get it once and one time only because it’s a component of Governor Polis’ metrics for reopening the Colorado economy.

          Nope, just nope. I’ll let the lemmings get “the jab” for the “metrics”. Cases are already steadily dropping in the US. It’s over, even with the new mutated strains. Of course, they will deny that and we will be fear mongered into getting new jab every year.

          2. As a squatter who wears a BLM headband my social credit score is quite high. I can afford to lose a few points for avoiding the jab

        4. I’m not terribly worried about a covid passport, IF it’s only for COVID. Six months from now, at least in the US and possibly UK/Europe, there will be no deaths and almost no cases. Governments will have a tough time convincing Wal-Mart or theatres to go to the expense of checking for passports, especially since there are no passports for polio or measles or even flu. I think those passports will fade away. [they may linger for international travel, since those populations won’t get a vaccine for a while.]

          What worries me is that these passports are the infrastructure to build a personal profile. Anyone could add even more data and add up to a complete medical passport and social credit score. 😕 You would think that this is covered under the 4th Amendment. I’m pretty sure that “not being allowed to enter a home without a warrant” was 1792-speak for not rifling through financial or medical records, which of course were all physical paper at the time.

          1. 10 points have been added to your Social Credit Score™ for that first paragraph.

            However, 20 points have been deducted from your Social Credit Score™ for that second paragraph.

            The Reddit moderation team (remember those lovely ladies?) are reviewing your case and you will be notified within 48 hours if you are allowed to post again.

      2. need it yearly

        Fauxi has been so quick to praise the existing vaccines for protecting against variants that he’s undercutting the every-year narrative. Pfizer and Moderna better have a conversation with him fast. There’s still time for him to flip flop.

        1. “There’s still time for him to flip flop.”

          “You know in my line of work, you gotta be able to sing The Battle Hymn Of The Republic or Dixie with equal enthusiasm…depending upon present company.” —Sim Carstairs, river ferry operator

  12. ‘The Federal Reserve now owns more than a third of the agency mortgage-backed securities, or MBS market. … As of last week, the Fed held $2.2 trillion of agency MBS.’

    It doesn’t seem to be a huge leap to connect the news that the Fed owns over 1/3 of agency mortgage backed securities to current news that U.S. housing prices are increasing at an astronomical rate, shrinking inventories.

    The Fed owns Housing Bubble 2.0, and they will own the long aftermath, once it bursts.

    2. So they have all this on their ‘balance sheets’ and control the interest rates.

      We will never see a 20% drop in the price of housing – they would have to take a huge mark-to-market loss. So that only says low interest rates and inflation.

      Or is there another reasoning

      1. “We will never see a 20% drop in the price of housing”

        You said the same thing in 2010…. and prices fell 40%.

        1. I bought my condo in downtown Seattle in 2010 – it had dropped 30% (asking price) since the peak in late 2007.

          This time the Fed is too invested in their balance sheet – I absolutely believe that current asking is 20-30% above the fundamentals (rent:price ratio, income levels etc). But given everything else – i dont believe that the central banks will let (excess) liquidity drop or interest rate rise to the proper market levels. $2.2T of MBS on the books will force them to do unnatural things

        2. Have to agree with b. What do you think the Fed’s not-QE has been buying with all those printed trillions? MBS. No way will they let the value of those MBS fall.

          1. “No way will they let the value of those MBS fall.”

            Just like there was no way they would
            – let housing values drop by a large percentage on a national level;
            – let a major investment bank collapse;
            – let the GSEs go belly up;
            – let stonk values drop by 50%.

            And yet, somehow all of the above happened beginning with the Fall 2008 Financial meltdown and continuing for about six months until massive QE was deployed (longer in the case of falling home prices).

            It’s when everyone assumes they can’t lose, because the central bankers have their backs, that moral hazard runs wild and reckless, wasteful, high-risk financial gambling mushrooms to a gargantuan scale.

          2. The real discussion here is whether the Fed is the Great and Powerful Oz, in full control of all markets and prices at every point in time.

            You guys say yes, but history suggests otherwise.

            Command and control economic systems have always eventually collapsed of their own weight. I don’t expect the one the Fed has devised to turn out any differently, once it is overwhelmed by market forces it can’t control.

      2. We will never see a 20% drop in the price of housing

        The government cannot prevent pain. They can only postpone it and make it worse.

    1. I have a 10+ year old Brother laser printer that suddenly jams all the time. It’s cheaper to buy a new one than to fix the old one.

  14. Retail/commercial is dead; mansions/luxury is dead; rental business is dead; how much longer can single family homes hold on before they look down and see their last ten steps have been over a cliff?

    1. A big problem is that so many traditionally owner-occupied homes have been sucked into the highly lucrative rental housing sector, including AirB&B, plus a huge number of homes are occupied by squatters enabled by pandemic eviction and foreclosure moratoriums. The net result is a dearth of inventory subject to bid wars.

      1. “The net result is a dearth of inventory, with what little there is subject to bid wars.”

          1. This makes sense to me, thanks. Also that it points to a steeper drop than ever when it happens.

          2. Sounds to me like a perfectly healthy market.

            “A $400,000 house got 122 offers in 2 days, highlighting the desperate frenzy buyers are facing amid skyrocketing real-estate prices and a dearth of homes for sale
            Avery Hartmans
            Mar 27, 2021, 6:39 AM”

      2. plus a huge number of homes are occupied by squatters enabled by pandemic eviction and foreclosure moratoriums
        I thought this artificial shortage might change come July 2021, now I am beginning to this might begin to change in the fall.

    2. TPTB will do everything they can to limit residential supply. As I have mentioned before, in my little burg you can’t subdivide unless you have water rights, which are $$$. There are almost no buildable lots for sale in my zipcode. They go for $200-300K.

      1. Where i grew up houses always sold fast, we walked to school everyday, the HS middle and elementary school were about a half a mile, in different directions. but our city mandates sidewalks within 3/4 mile from a school,so lots of streets had sidewalks on both sides.

        1. It took a year for my parents to sell their Orange County shack in 1969-1970, and they got low 20’s. According to zillow, that ancient shack is worth just shy of $1 million.

      2. water rights

        That’s a shame. We have a 600 ft deep lake that is 38 miles long. Water rights aren’t a thing.

        1. That’s a shame.

          It is what it is. In 2000 the state population grew almost 7%. Now it’s down to 1%. Given the water scarcity, that is perhaps for the best. Metro Dumver gets about 25% of its water from aquifers which will eventually run dry.

          There is a “lake” in the middle of my little burg, which is actually a reservoir. In decades past it was always full of water. The water in the lake actually belongs to the Greeley water district, and as some here know, Greeley has grown a lot in the past couple of decades. Anyway, Greeley has been sucking that lake dry in the fall and winter (it briefly refills in the summer from the mountain runoff), and the locals who paid top dollar for “lake front” property are very butthurt.

      3. TPTB will do everything they can to limit single family home residential supply.

        FIFY. But they love to pack us into airboxes where we’ll own nothing and everything is delivered by drone.

        1. I cant wait for the $2 a gallon green energy Greta/ AOC gas tax,
          but then a tank of gas has been lasting me a month the last year.

    3. See above this in the thread. With all the MBS on the Fed balance sheet, they will never let prices drop (if they can).

      The irresponsible buyers might have won.

  15. “Some small landlords on Long Island are facing foreclosure and bankruptcy due to non-payment of rent from their tenants during the pandemic, Eyewitness News has learned.”

    Technically isn’t the problem that these landlords have stopped repaying their own mortgages? If a landlord actually owns a property, rather than rents it from the bank, I don’t see why he would be facing foreclosure.

    1. The Narrative is that the tenant funds your mortgage payments, and that you can harvest the sweet equity via refis, and pay for it by raising the rent. You don’t have to work and you live like a king.

      It works great, until it doesn’t.

    2. ‘Investor loans struggle because so many tenants aren’t paying rent,’

      There seems to be unlimited confusion on this point.

      In short, it’s the landlord’s responsibility to repay his mortgage. If the tenant stops paying rent, that doesn’t make the tenant responsible for the landlord not paying back his loan.

      At least this is my understanding of the legal situation.

      1. PS People who are not the investor/landlord or the renter in this private contract are not parties to the transaction and should not be forced to bear the losses in case of contract failure, just because the investor’s certain path to untold riches didn’t work out for him. Along with the rewards come the risks.

  19. As long as we live in a World of fake news and Entities trying to take our freedom by unjustified untested vaccines I will avoid these vaccines forever if I can. Giving in to this medical tyranny just makes them push it more.

    Its the same with people buying into buying overpriced shacks or anything else that represents their rigged systems.

    Your going to take anything that comes from Entities that are criminal and self serving control freaks that have proven they don’t care how much destruction and insanity they cause. A One World Order of these Entities controlling everything would be nuts, its already nuts. These Powers that dictate weren’t elected and they have spent years bribing, corrupting government, and brainwashing and rigging systems. Now the bizarre narrative is to pit minories against the White Race . This is a obvious fake narrative to divide and conquer. The power mongers are a bunch of White Guys.
    There isn’t anything about this Pandemic that is grounded in justified and that’s why they are controlling the news.
    You won’t get your freedom if you take the vaccine. They will just double down on becoming more invasive. The time to rebel is now. I wouldn’t trust them and I wouldn’t trust their vaccines. They have been planning a fake pandemic for a long time as the evidence shows.
    Frankly, I’m shocked at how much people are going along with this fear mongering fake Pandemic. All the evidence adds up to it being a fake Power grab .
    My policy has always been to detach from anything that is false or evil. Bill Gates is not a person I think is humane or worthy of respect and who is he to say populations should eat bugs, the Sun should be blocked out, and populations should take jabs that make that bastard even richer. Soros and Schwab are also Nazi like freaks that want to destroy the United States as a Conditional Government that even has borders. No doubt these Freaks are tied into other Powers like the Rothschild and Rockefellers. Taking over by debt being unsustainable is a method used going back a long time by these monsters. They start Wars, they create crisis, false flags and fake narratives.
    Since 8 billion people outnumber these bastards, rejecting their rule is the only solution.

    1. Bill Gates is not a person I think is humane

      I met him once, about 30 years ago. He gave me the creeps.

      1. No kidding Gates is creepy, but they all are creepy liars. Fake news with censorship is the biggest tool they have going right now.

        No way am I going to do anything they push because I view these Entities as being just as evil as Hitler/Stalin/Mao, you name it.

    1. As one San Diego Zoo visitor explained…

      The idiot actually took his 2 year-old daughter inside the elephant enclosure.

      25-year-old father carries his toddler daughter into elephant enclosure at San Diego Zoo

      545,667 views•
      Mar 20, 2021

      https://youtu.be/yapBml44MdM

      1. FIFT: A father allegedly carried his 2-year-old daughter into an elephant habitat at the famous San Diego Zoo to take a photo with the animals. An elephant seemed like it wanted to charge[d] at them, and the father dropped his child when they tried to escape the enclosure Friday. The elephant was not harmed, and the man was able to get his daughter out of the habitat safely. 😅 The 25-year-old father was arrested on suspicion of child endangerment. Police told The San Diego Union-Tribune that the man “wanted to take a photo with the African bull elephant.”

  22. And tell me why this mutant/variant theory of viruses isn’t questionable. Think about it. When I was young all you had was one shot or sugar cube to get lifetime immunity. Now they want you to get jabbed repeatedly.

    And think about the story. They suggest you have this virus that mutates every 6 months or so , when historically before vaccines, these plagues would burn themselves out, not to return for decades.

    And this virus they act like its so smart that it mutates so that it can reinfect people who already have immunity if you don’t get constant shots. I find it hard to believe . You have the South African strain, the California strain, the England strain, the New York strain , oh give me a break this sounds like such BS its insulting. Where is the proof of all these so called mutant strains that are defined by geography.? THEY ARE MAKING THIS UP.

    The mysterious world of medicine , with the invisible enemy.

    1. THEY ARE MAKING THIS UP.

      There is little doubt about that. Annual booster shots or you can’t travel, go to work, go to a stadium (fine with me, I’m not paying $100+ to watch some ingrates, who hate me, throw a ball), etc.

      1. I’m not paying $100+ to watch some ingrates, who hate me, throw a ball
        I have come to the same conclusion.

      2. Show me the annual booster shots. The most I’ve heard is a South African booster to be had this summer. The rest is scientists speculating.

        1. Show me the annual booster shots.

          Patience grasshopper. It’s too soon for them to start talking about booster shots. First they have to get you to accept that you will need a vaccine passport so that you can go to the office, shop, travel, etc. Once you submit to that, then you will told that not only is it not over … it will never be over.

  23. Georgia is going to be boycotted by Corporate America over its legislation to curb voter fraud.

    Black Fortune 500 executives want companies to fight Republican voting restrictions

    The objective is a permanent Democrat supermajority, no matter what it takes: voter fraud, trillions in free gibs, etc.

    What will they do when other states also tighten their laws? Boycott the majority of the country?

    1. “Black Fortune 500 executives want companies to fight Republican voting restrictions”

      “Biden is America’s point of no return.” —Thomas Sowell

      1. “Biden is America’s point of no return.” —Thomas Sowell

        It makes me think of the scene in the V For Vendetta, where Prothero goes on a tirade about how the US had turned into an utter sh!thole and was begging Britain for medical supplies.

    2. “free gibs”

      When I was in Georgia last month, driving south on 75/85 into downtown Atlanta there was still an election billboard up: “COVID relief now, vote Jon Ossoff for U.S. Senate.”

        1. I once had to drive from the Atlanta airport to northern Georgia, which included driving on 75 through downtown. It’s like riding Space Mountain. That’s not a compliment. I almost feel safer on the Bay Bridge.

  24. Substack publishes a statement titled “How we approach moderation decisions” (3/25/2021):

    “In December, we published a statement about our philosophy on content moderation. In the time since, content moderation policies across all platforms have become only more consequential and debated. This post is an attempt to offer further clarity on how and why we make our moderation decisions.

    We believe in putting writers and readers in charge. Writers own their content and their mailing lists and have full editorial control on Substack. Readers choose for themselves which writers to invite into their inboxes and their minds. And that’s why we have a hands-off philosophy when it comes to censorship.

    We believe in the importance of a free press and free expression, allowing writers to explore ideas even when they are unpopular, and empowering readers to thoughtfully evaluate an argument’s merits for themselves.”

    https://blog.substack.com/p/how-we-approach-moderation-decisions

    See also Glenn Greenwald — Journalists Attack the Powerless, Then Self-Victimize to Bar Criticisms of Themselves (3/29/2021):

    https://greenwald.substack.com/p/journalists-attack-the-powerless

    This is why I use the archive dot is website when sharing links to the New York Times or Washington Post, we deny them clicks, and deny them ad revenue.

  25. Has the Archegos market disturbance blown over without ruffling any bull’s feathers?

    1. The Financial Times
      Archegos Capital Management
      Banks conduct internal probes over Archegos debacle
      Prime brokers quizzed by risk managers over how Hwang family office was offered so much leverage
      Bill Hwang
      There are questions over whether Bill Hwang’s counterparties knew about his relationships with other banks and the scale of the leverage he was using
      Owen Walker in London and Leo Lewis in Tokyo 2 hours ago

      Some of the banks that collectively had more than $50bn of exposure to Archegos Capital are conducting internal inquiries over whether Bill Hwang, the former hedge fund manager who ran the family office, concealed his other positions from them.

      Executives within the prime brokerage divisions of at least two banks are being quizzed by risk managers over why they offered a business as small as Archegos tens of billions of dollars of leverage on trades in volatile equities through swaps contracts, according to people with knowledge of the discussions.

      Those trades blew up last week when Archegos was hit with margin calls after a plunge in ViacomCBS shares, leading to chaotic trading as some banks tried to limit their losses.

      Nomura, Japan’s largest investment bank, said its losses could hit $2bn, while sources close to Credit Suisse said the Swiss bank could lose up to $4bn. Mitsubishi UFJ Financial Group has announced it will book a $270m loss on the trades, while another three banks — Goldman Sachs, Morgan Stanley and UBS — have indicated their losses will be minimal.
      …

      1. Well, there’s always “Seppuku” for those at Nomura. I suppose an honorable Swiss banker could leap from the roof.

  26. Fed’s Waller says the central bank isn’t keeping rates low to finance government debt
    Published Mon, Mar 29 2021
    Jeff Cox
    CNBC

    “The Federal Reserve is not keeping monetary policy easy to enable the government to rung up debts and deficits, Fed Governor Christopher Waller said Monday.

    Defending the Fed’s independence from the fiscal authorities in Congress, Waller rejected notions that the central bank is holding borrowing costs low to help service the debt or that it is conducting asset purchases to finance the debt-laden federal government.

    “My goal today is to definitively put that narrative to rest. It is simply wrong,” Waller said in prepared remarks to the Peterson Institute for International Economics. “Monetary policy has not and will not be conducted for these purposes.”

    https://www.cnbc.com/2021/03/29/waller-says-fed-isnt-keeping-rates-low-to-run-up-the-deficit.html
    —————————————————

    The Fed was created in 1913 to fund the government and protect Wall Street. In 1977, it got its PR “dual mandate.” But for 64 years, it was operating on its founding principles, and still does. The Fed is subservient to the government (do we really think Yellen was piping the tune Trump and Dimon were dancing to?) It’s supposed to further national interests which may be geopolitical in nature, when it can. Seems to me that the ever-declining interest rates are more than a happy coincidence.

  27. Why is the Federal Reserves destruction of Social InSecurity and private pensions never mentioned anymore?

    1. When my father died, I wrote about what a great friend and hero he had been to me for so many years. A colleague said to me that he envied me. He meant of course not the loss but the treasure of good memories. Some may envy you as well.

  29. It’s an illusion.
    If your house doubles in price you have gained no wealth. You still own the same house.

        1. The exact same house would be more expensive with increased property taxes. My previous comment should have been unless you sell and hold onto the cash until a market correction.

        2. Unless you sell and move somewhere cheaper, or sell and move into an RV on raw land, or sell and rent, or sell and downsize, etc.

          I think you’ll see a lot of that with late-boomers and elder GenX. They’re still working age but the kids are in college and they can quietly work at home, so why not move to a retirement location now instead of later? 55+ communities would do well to start mailing out tons of brochures (actually they should have done that a year ago).

        3. Wrong. If you sell you have enough purchasing power

          Actually, in a bubble you do not have enough from your sale to buy same as in a few months. In fact, not on the same day. In fact, not even in a flat market.

  31. I was watching another podcast where the Globalist where talking.
    They want the Government to pay for all the infrastructure they plan to control the World. They think people will be happy with their rigged information super computers, while they control all other aspects of life of people.
    What I noticed was that they are so out of touch with what really drives the human spirit. Like controlled entertainment and information like 1984 will suffice for humans.
    It’s pretty arrogant for them to want to stifle the creative spirit of the human race in favor of a drone like existence for the masses, while they are in their ivory towers putting people in slots. Like all there is to life is a social credit score that they approve of.
    You would not believe how madly in love they are with their ideas to put people into a ant farms where they are the superior controllers.
    It really struck me how sick they were in their view of populations of people and how much they want to take peoples rights to carve their own destinies. I find them to be out of touch and their power has gone to their insane heads in which they think they are Gods .
    It really astounding to just hear their plans for the human race, which can only be labeled mass slavery.
    I think they will fail because they are so out of touch with people in their isolated world of elite control freak insanity.

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