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It Is Disastrous For Investors Who Purchased At The High Prices

A report from DS News. “An estimated two million homeowners remain in forbearance plans. By stage, 10.7% of total loans in forbearance were in the initial forbearance plan stage, while 83.1% were in a forbearance extension, and the remaining 6.2% were forbearance re-entries. ‘An unchecked wave of foreclosures would also risk destabilizing the housing market for all consumers. We are giving homeowners the time and opportunity to make informed decisions about the best course of action for them and their families, whether that is seeking a loan modification or selling their home. And we are giving mortgage servicers the flexibility they need to serve homeowners with dignity, while managing an unprecedented volume of borrowers seeking assistance,’ said CFPB Acting Director Dave Uejio.”

From Housing Wire. “Ginnie Mae is set to introduce a new 40-year mortgage term for its issuers. Only loans with terms greater than 361 months and less than or equal to 480 months will be accepted, but there will be no loan amount restriction, Ginnie Mae said. ‘We have begun the work to make this security product available, because an extended term up to 40 years can be a powerful tool in reducing monthly payment obligations with the goal of home retention,’ said Michael Drayne, Ginnie Mae acting executive vice president. ‘It’s important that Ginnie Mae issuers have secondary market liquidity for options that our agency partners determine are appropriate for supporting homeowners in distress.'”

“John Getchis, Ginnie Mae’s senior vice president for capital markets, noted that the 40-year pool design gives issuers more control and the ability to maximize market pricing. ‘We think the market will find value in securities backed by these loans, so we wanted to provide a pooling structure that would enable issuers to capture that value — thereby enhancing their ability to provide the strongest possible options to the homeowners while remaining respectful of investors’ capital,’ he said.”

From KSMU on Missouri. “Bud Jones, president of the Greater Springfield Board of Realtors, says he thinks the current situation is more sustainable than the housing bubble that caused the Great Recession. ‘We’ve got good interest rates,” Jones tells KSMU. ‘We’ve got a lot of people willing to buy. And even though home prices went up, obviously, it’s ok. It seems like a very palatable increase in prices. As much as they are higher, appraisals are staying up and it feels a little less like a house of cards than maybe in 2008 might have felt.'”

From KPLC in Louisiana. “With all the home construction in the Lake Area, it’s hard to believe there’s a housing shortage pushing the price of homes through the roof. Nationwide, there’s a growing housing shortage. ‘But Lake Charles area, Southwest Louisiana, made it much worse by having two hurricanes and a freeze and a flood,’ realtor Deborah Anderson said. Homeowner Sarah Wilson said selling her home to a first-time buyer was a quick process but pricing in a market that has been through everything the Lake Area has was the real challenge.”

“‘Because the market is so hot, the pricing hasn’t, in some cases, caught up,’ Wilson said. ‘We took a number of different parameters.'”

The Spokesman Review in Washington. “Gov. Jay Inslee imposed a moratorium on evictions. But on July 1, they will begin to fade away. For the past 15 years, Keith Kelley has managed a portfolio of some 50 rental properties, about half of them located in the West Central neighborhood where he and his family live. Kelley said he’s endured the most grueling and dispiriting stretch of his career. ‘Not only has it been extremely difficult managing in a situation where I can’t enforce contracts, I’ve been down about 30% on my rental income, which has had a really dramatic effect on my business,’ he said.”

“After Inslee revealed plans to again extend the moratorium last week, Kelley said he was reaching a breaking point. ‘For the first time in my career as a landlord,’ Kelley said, ‘I’m looking at the future thinking, ‘If things continue as they are, I’m not sure if I’m going to continue to doing this.'”

The Los Angeles Times. “California tenants will be protected from evictions for another three months, and those with low incomes will have all of their past-due rent paid by the state, under a bill signed Monday by Gov. Gavin Newsom in response to the COVID-19 pandemic. The three-month extension was opposed by some landlord groups, including the California Rental Housing Assn.”

“‘We have been under severe financial distress for an excess of 18 months now, and AB 832 will not help the tens of thousands of small mom and pop rental providers who are financially suffering and are struggling to continue providing affordable and safe housing for their residents,’ said Christine LaMarca, the association’s president.”

The Orange County Register in California. “It’s encouraging to see Newsom trying to narrow the pandemic’s housing aid gap. The reality check is admitting the Fed’s cheap money policies primarily benefit those wealthy enough to borrow. These financing bargains ballooned home prices across the nation to unthinkable heights — far in excess of any extra buying power created by record-low interest rates.”

“Of course, that cheap money could overheat housing values to a degree that the market suffers yet another collapse. That calamity might slash prices, creating chances for more California renters to join the privileged ownership group. Unless, the nation comes to ownership’s rescue — again!”

The New York Post. “In the past year alone, the number of sales surrounding the roughly two dozen properties listed on the Trump Organization‘s website jumped 72%, Realtor’s analysis found. Meanwhile, the average prices for these properties, mostly condos, have fallen nearly 24% since 2016. Josh Nass paid $1.8 million for a Trump Tower pad in an all-cash deal this month. The same unit sold for $2.3 million in 2006.”

“Sales at his Manhattan properties rose 16% in the first quarter of this year, taking into account that the median prices fell significantly, as they did throughout the city. Prices have been falling in the Big Apple since March and have been ‘declining consistently downward,’ Victor Rodriguez, director of market analytics at the CoStar Group, told The Post in April.”

The Western Investor in Canada. “At the new Upton tower in Calgary’s Beltline, tenants are offered 1.5 months of free rent, no security deposit and no move-in fee. In Edmonton, incentives offered by landlords include one and two months free rent, retail gift cards, free or marked down utilities such as internet and cable, move-in bonuses and cash incentives.”

“Winnipeg has many incentives advertised by landlords for one-bedroom apartments and condos spread out across the city. The most common deals include a number of units offered at discounted rent, move-in cash bonuses, free parking or utilities and gift cards. Among the best incentive found in Vancouver was in the Regency Park Residences on Cardero Street in the city’s West End. The landlord is offering one-month free rent for a one-year lease and two months free rent on two-year leases. One bedrooms start a $1,600 per month and the property manager told Western Investor June 25 ‘we have received a lot of calls, but we still have units available.'”

From Live Mint in India. “Many homeowners prefer to keep their houses vacant instead of renting them out, as they are afraid that the tenants may end up squatting on their properties. According to a report by Khaitan & Co and Knight Frank, the following cities have the highest vacant houses as a percentage of the total residential properties – Gurugram – 25.8%, Pune – 21.7%, Greater Mumbai – 15.3%, Delhi – 11-15%, Bengaluru – 11-15%, Ahmedabad – 11-15%, Ghaziabad – 11-15%.”

The South China Morning Post. “With Thai developers struggling to dispose of a massive stock of unsold flats in Bangkok, many of them are trying to lure overseas buyers with huge discounts and bargains to whittle down the inventory and get the struggling sector back on its footing. Bangkok-listed Sansiri, one of the top three developers in the Southeast Asian nation, is marketing units as small as 231 square feet (21.5 sq metre) starting at HK$500,000 (US$64,394) to buyers from Hong Kong – a size they are familiar with but at a fraction of prices in the world’s most expensive property market.”

From RE Talk Asia. “Australian landlords hoping to rent their units to foreign students are going through a painful period in which international student numbers are steadily declining. ‘Eight months ago, we advised investors to hold on to their inner-city property if they could afford to, but that there would be pain before gain,’ said Juwai IQI Executive Chairman Georg Chmiel. ‘My advice is the same today. These assets have depressed values now, so it’s a poor time to sell. It is disastrous for investors who purchased at the high prices of the last couple of years. It is less so for those who no higher than what they have fallen back to this year.'”

“In the Inner West of Sydney, the average asking price for units has fallen by 9.8% over the past 12 months. In the same area, rents are down 8.8% compared to a year ago. ‘Australian student accommodation operators have some 100,000 beds and $3 billion of assets. Occupancy is down to just 25% on average — meaning that 75% of their rooms are empty. They are suffering, but they also have deep pockets, a sophisticated outlook and a long-term time horizon. They are investing more and building more units, even though many of their rooms are empty today.'”

From Stuff New Zealand. “There is a shortage of rental properties nationwide yet on Auckland’s popular North Shore some landlords are reporting they are struggling to find tenants. NZ Property Investors Federation executive officer Sharon Cullwick said a number of North Shore landlords had reported they were finding it extremely difficult to get tenants for their rentals. A significant number of properties had been listed on Trade Me since last year, she said.”

“‘One reason could be that more apartment buildings closer to the CBD are being finished and people are choosing to move into them instead,’ she said. ‘Another reason could be the rents being asked for do not meet the market and are too high.'”

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This Post Has 106 Comments

  1. ‘we are giving mortgage servicers the flexibility they need to serve homeowners with dignity, while managing an unprecedented volume of borrowers seeking assistance’

    That’s some red hotcakes right there.

  2. ‘We have begun the work to make this security product available, because an extended term up to 40 years can be a powerful tool in reducing monthly payment obligations with the goal of home retention’

    All yours for 480 easy payments!

    1. “…extended term up to 40 years..”

      Mr. Bankers dream

      How much longer until 1200 month (100 year) multi-generational products are offered?

      Be born into debt and die with the same debt.

      Something very medieval about all of this.

      1. “Something very medieval about all of this.”

        Think: Serf City.

        During the wonderful medievil period called the Middle Ages it was considered and fully accepted that it was God’s Will that the Divine Right of Kings be attended to and this philosophy was implemented by mass coersion.

        This philosophy continues this very day, all that has been changed is the terminology: The label of Kings and Kingdoms has been replaced with concept of Private Clubs (of which you are not a member), and mass persuasion has replaced mass coersion as the chosen method of implementation.

        Progress.

        1. BTW, I still consider the modern concept to be God’s Will.

          “If God did not them to be sheared He would not have made them sheep”. – Caldera

          😁

      2. It’s not new. This quasi/guberment loan guarantee racket is huge and corrupt to the core. Giving loans to illegals with no income, you name it.

        1. What we’ve found is that the entire system, top to bottom, is corrupt through and through. Nothing has been left untouched. Politicians and corporations are looting the Treasury.

          1. Think about it: we used to pay off small loans in 15 years. Lower property values meant lower taxes. We had better paying jobs, benefits, longer term employment with increasing pay. Enter globalism, much of that vanishes. Globalists use shack prices to prop up a failing economy. We pay ridiculous housing prices and taxes. The system collects interest for 30 years (now 40 – wohoo!) instead of 15.

      3. There’s not much incentive for a 100-year mortgage. At those lengths, the interest rates for such a risky product are high enough that the monthly nut is the same as a 40-year mortgage. IIRC, 40-year mortgage is about the max.

        Of course, that was before the Fed started printing money to incentivize banks to kept those interest rates down and house prices up. Heck, who imagined an 84-month loan for a sexi-trux? So we may well see 100-year mortgages.

  3. ‘Lake Charles area, Southwest Louisiana, made it much worse by having two hurricanes and a freeze and a flood’

    Where do I sign up?

    ‘because the market is so hot, the pricing hasn’t, in some cases, caught up’

    ‘it feels a little less like a house of cards than maybe in 2008 might have felt’

  4. ‘Not only has it been extremely difficult managing in a situation where I can’t enforce contracts, I’ve been down about 30% on my rental income’

    How do those 5% cap rates look now?

  5. “…California tenants will be protected from evictions for another three months, and those with low incomes will have all of their past-due rent paid by the state…”

    Of course, all these payouts will be closely monitored and audited, with no chance for fraud.

    1. I wonder if prison inmates will figure out a way to collect some of these rent subsidies, similar to how they collected unemployment benefits last year?

      “In the past year, California has paid $153 billion in unemployment benefits, including billions of fraudulent payments to prison inmates and others who were not eligible. The state quickly ran out of money to pay benefits and had to take out a loan from the federal government to pay the rest.”

      https://www.smdp.com/california-budget-looks-back-to-a-time-before-pandemic/206242

  6. ‘median prices fell significantly, as they did throughout the city. Prices have been falling in the Big Apple since March and have been ‘declining consistently downward’

    Prices in NY have been sinking like a turd in a well since 2016 Victor.

  7. Dallas, TX Housing Prices Crater 11% As US Housing Demand Plummets On Soaring Fraud

    https://www.movoto.com/tx/75209/market-trends/

    As one national broker disclosed, “There are no bidding wars nor has there ever been… It’s just something we deliberately misrepresent to get the buyer to pay far more.”

  9. ‘Occupancy is down to just 25% on average — meaning that 75% of their rooms are empty. They are suffering, but they also have deep pockets, a sophisticated outlook and a long-term time horizon. They are investing more and building more units, even though many of their rooms are empty today’

    QE is deflationary.

    1. QE isn’t deflationary when outfits like BlackRock can use printed Fed money to bid up the prices of SFH.

      3. like BlackRock

        In practice, building too many houses with all that QE money leads to price collapse. It’s really very simple.

        1. I won’t speak for the rest of the country, but here in my little burg, new shanty construction is a shadow of what it was under Bubble 1.0, and I think that’s by design.

    2. WTF kind of Realtorbabble is “a sophisticated outlook” even supposed to mean?

      Australia is still locked down under the bootheel of medical tyranny, and you think international students will want to rent there? LOLZ

  10. These policy-makers have forgotten their childhood. The longer you extend and try to cover-up a lie, the worse it turns out in the end.

  11. “Only loans with terms greater than 361 months and less than or equal to 480 months will be accepted, but there will be no loan amount restriction, Ginnie Mae said.”

    Who needs an individual landlord, when you can rent from the bank for life? You can get any size loan you want, and spread the payments over forty* years to keep them affordable. And there’s no problem if your credit is bad, because the loan is federally guaranteed.

    What’s not to love?

    * 40 × 12 = 480 months

    1. PS This policy is a bubble extension measure that will enable just a little bit more air to enter the bubble before it deflates. Those who jump at the opportunity may find soon themselves in a lifetime of underwater loan ownership.

    2. Newfi.com is advertising a forty year loan, first TEN years is interest only.Welcome to 2005!

      1. I’ve been seeing more on “interest only” lately in articles. Even “balloon payment” without any sense of irony.

        1. How about a 100 year multi-generational loan, years 1->99 interest only, year 100 balloon payment.

          In other words, pass off the heavy lifting to your grand-children.

          1. Wouldn’t descendants be able to refuse to transfer the loan to their name, and have the shack be foreclosed?

            I think that the only incentive to accept a loan transferal would be that over time time the shack appreciates, even if only to track inflation.

  14. I find it more than just odd that MSM does no real investigation on this stuff when ET does so despite a much lower budget:

    Scientists Obfuscated Source of COVID-19-Like Virus Stored at Wuhan Lab

    Virus named RaTG13 was discovered in an abandoned mine in Mojiang, Yunnan, nearly 10 years ago

    ‘Notably, Shi’s 2020 article also alleged that the pandemic had “started from a local seafood market.” That false claim, which has been disproven, was not addressed in Shi’s addendum.’

    ‘Although it is not yet known precisely why Shi obscured the true origins of RaBtCov/4911 and obfuscated her 2013 discovery, it is undeniable that Shi quietly kept the closest known relative to COVID-19 in her Wuhan lab for at least seven years and failed to address her discovery’s true origins.’

    https://www.theepochtimes.com/mkt_morningbrief/scientists-obfuscated-source-of-covid-19-like-virus-stored-at-wuhan-lab_3878140.html

    1. You mean like how they’ve explained the shady, manipulated PCR test to the general sheep-lic?

      I’d love to know where one signs up to write the scripts for the mega-elite to feed to the proles. Probably the most fun job ever.

      1. I’d love to know where one signs up to write the scripts for the mega-elite to feed to the proles.”

        Try The Onion.

    2. I also read a article last night where they said that the bodies they dug up from the Spanish Flu showed that it was bacteria pneumonia that caused the deaths. Read another article that at the time they were over using aspirin , so a certain percentage of deaths were caused by bleeding from stomach from aspirin abuse.
      In another article they said that they were testing vaccines on US troops during World World One, and breakouts of disease were occurring in the barracks following the vaccines.

      Just saying the more you dig into the rabbit hole the more you find out .

      From the standpoint of Rockefeller forming the Pharmacy based approach to medicine at the time, there was profit motive for cure by pharmaceutical approach.

      Somehow I have always been suspicious of the pharmaceutical approach to medicine. Not trying to attack anything good from that system.

      But, when one of the biggest Monopolist of all times, being Rockefeller, was a big force in the creation of the Medical system we have today, one has to wonder about the system , and how much harm it’s actually creating.
      We are just use to the system and don’t question it.
      But why they would be screwing around with dangerous viruses and splicing them together in a China lab , with US funds financing it, with Fauci involved, and Hunter Biden having a connection, is getting pretty hard to digest as benign.

      1. I also read a article last night where they said that the bodies they dug up from the Spanish Flu showed that it was bacteria pneumonia that caused the deaths.

        Dr. McCullough mentions that in his videos: it isn’t the virus that kills you, it’s the respiratory tract bacterial infection that follows, which is why it is unacceptable that people who were diagnosed with Covid were sent home with no treatment to prevent the bacterial infection.

        1. Also, any system or hierarchy can be corrupted with time or the system might have been corrupt from day one.
          Obviously the education system is corrupt and has become brainwashing centers. Government no doubt has been corrupted from within. Medical system is another one that needs some scrutiny, economic systems corrupted, fake news and censorship is corruption.

          But when you have so many systems that are corrupt, than the systems are vulnerable to collapse ,destruction and harm, and overtake by revolution or something like Marxism, or Monopolies taking over the world, etc.

          None of the corrupted systems are sustainable in the final analysis.

        2. “I also read a article last night where they said that the bodies they dug up from the Spanish Flu showed that it was bacteria pneumonia that caused the deaths.”

          wow, that’s incredible science. also nerve wracking.

          i suppose i better insist on a clean pair of skivvies when i go to save my descendants embarrassment upon exhumation

          forensic exam will show heightened levels of caffeine (Folgers), hunchback (laptop posture)
          & bony claw clutching printout from the wildly popular Housing Blog with one sentence:

          Realtors Are Liars

  15. Some Fed officials believe that purchasing $40 billion a month in mortgage-backed securities is having no effect on housing prices.

    That’s easy to test: End the policy, and see if housing prices begin to drift back to earth (or not).

    1. The Financial Times
      Opinion Unhedged
      The Fed should worry about housing
      Robert Armstrong yesterday

      Is the Fed inflating a housing bubble?

      … One side-effect of the Fed’s asset-buying programme is higher asset prices. If the Fed was only buying $80bn in Treasuries a month, that itself would push rates of all sorts down, making it cheaper to finance house purchases, and driving house prices up. But the Fed also buys $40bn a month in mortgage-backed securities, or MBS, which affect housing finance more directly.

      Whatever the cause, asset prices that are very high by historical standards are not generally very stable, and house prices are very high. If house prices do crack, that could make a lot of people feel poorer, a lot more people than, say, a fall in share prices would. Such a negative wealth effect could crush economic growth and inflation (can you remember a time when that happened? I can).

      …not everyone at the Fed thinks that house prices are a problem, or if they are a problem, that they are the Fed’s fault. Here is New York Fed president John Williams, as quoted in The Wall Street Journal:

      “My view is that the monetary accommodation that we’re providing, both in terms of the very low fed-funds rate and also our asset purchases, is supporting overall financial conditions,” Williams said. He added that the support isn’t “specifically targeted to the housing market”.

      “My best guess estimate is that we are having a de minimis effect on mortgage interest rates with our mortgage-backed securities purchases.”

      This is not a completely insane view,…

      1. Went out to dinner with some longtime friends a couple of nights ago. Like so many others we know, they are pulling up the tentstakes and leaving the state. Hoping to sell quickly and buy a place in Utah, despite the insane bid wars they expect to encounter upon entering the market there.

        I reminded them that it’s better to be leaving California than entering, and they agreed, particularly when you get to cash out your sweet pandemic equity at a time of artificially suppressed interest rates and reinvest it in a more affordable market.

  16. From yesterday never share a wall or wife……….our friends bought a condo , yeah they jumped on it….they had to move before school started in sept, the owners daughter and grand kids wanted to move in its walking distance to school.
    They have been looking to rent for months but it seems like everyplace the shared wall is the bedroom……..this one was the kitchen its the end unit so they scarfed it up….

  17. – From the “this is a completely normal market” category.

    A report from DS News. “An estimated two million homeowners remain in forbearance plans. By stage, 10.7% of total loans in forbearance were in the initial forbearance plan stage, while 83.1% were in a forbearance extension, and the remaining 6.2% were forbearance re-entries. ‘An unchecked wave of foreclosures would also risk destabilizing the housing market for all consumers.”

    – From the “must keep the housing asset bubble going” category. Loan duration increasing to 40 years in order to keep payments “affordable.”:

    From Housing Wire. “Ginnie Mae is set to introduce a new 40-year mortgage term for its issuers. Only loans with terms greater than 361 months and less than or equal to 480 months will be accepted, but there will be no loan amount restriction, Ginnie Mae said.”

    – From the “pandering to their base,” and “forwarding the Socialist agenda of elimination of private property rights” categories. I have yet to see anywhere that deferrals, moratoria, or forbearances have actually ended, even though the CCP virus pandemic is essentially over here in the U.S.

    “You never let a serious crisis go to waste. And what I mean by that it’s an opportunity to do things you think you could not do before.” – Rahm Emanuel

    The Los Angeles Times. “California tenants will be protected from evictions for another three months, and those with low incomes will have all of their past-due rent paid by the state, under a bill signed Monday by Gov. Gavin Newsom in response to the COVID-19 pandemic. The three-month extension was opposed by some landlord groups, including the California Rental Housing Assn.”

    – The Case-Shiller housing index is a lagging indicator. We are likely already past the peak, since the “blow-off top” is now in the rear-view mirror as shown by pending home sales. Things are still looking pretty bubbly to me, however. Disclaimer: I’m not a PhD economist at the Fed though, since they never see bubbles until after they’ve burst. Wink, wink. Nudge, nudge.

    https://www.cnbc.com/2021/06/29/home-price-gains-in-april-truly-extraordinary-sp-case-shiller-says.html
    Real Estate
    Home prices surged in April at a ‘truly extraordinary’ rate, S&P Case-Shiller says
    Published Tue, Jun 29 20219:00 AM EDT | Updated 3 Min Ago
    Diana Olick

    Key Points

    * ““April’s performance was truly extraordinary,” said Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices.”

    * “Home prices in April saw an annual gain of 14.6%, up from a 13.3% increase in March, according to the S&P CoreLogic Case-Shiller National Home Price Index.”

    * “Among larger cities covered by the index, the 10-city composite was up 14.4% year over year, up from 12.9% the previous month. The 20-city composite was 14.9% higher, up from 13.4% in March.”

    – Realtor-speak:

    “There has been growing talk of a price bubble in the housing market, but the fundamentals of today’s market say otherwise.”

    – Moar Realtor-speak:

    “Although home price growth is reaching new highs, the risk of price declines has fallen far below pre-pandemic and summer 2006 levels, when homes prices last peaked. This is likely because favorable mortgage rates and income growth continue to keep the ratio of mortgage payments to monthly household income much lower today,” said Selma Hepp, deputy chief economist at CoreLogic.”

    – A voice of sanity in the wilderness of REIC shilling housing bubble 2.0.:

    ““So much for the Fed’s all-inclusive monetary policy where lower income people now can’t afford housing,” wrote Peter Boockvar, chief investment officer at Bleakley Advisory Group. “

    – From my view, and based on history, there’s never been an economic boom (created by easy $) that wasn’t followed by an economic bust. Am I wrong?

    – The U.S. economy is the definition of insanity based on the most recent asset bubbles; they both were booms immediately followed by busts (2000, 2008). A lot of people though are thinking “it’s different this time.”

    “Insanity: doing the same thing over and over again and expecting different results.” – Albert Einstein (misattributed) – Narcotics Anonymous

    – We have reached peak “can-kicking.” What happens next? I’m sure this is fine. Greater minds at the Fed have said so.

    ‘I don’t believe there will be another financial crisis in our lifetimes.’ – Janet Yellen, 2017

    “At this juncture, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained.” – Fed chairman, Ben Bernanke, Congressional testimony, March, 2007

    “There is no housing bubble” – Ben Bernanke 2006

    ‘We will not have any more crashes in our time.’ – John Maynard Keynes, 1927

    “Under the Federal Reserve System we shall have no more financial panics.” – Charles Hamlin, the first head of the Federal Reserve in 1915.

    “When it becomes serious, you have to lie”. – Jean-Claude Juncker, then President of the Eurogroup, April 20, 2011

    “The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.” – Ernest Hemingway

    1. We seem to have entered a rolling bust, with cryptocurrencies, meme stocks and lumber futures taking the lead, and mainstream risk assets to follow.

  19. I was out and about yesterday, and decided to fill up the tank between errands. The “gasoline shortage” has reached my little burg as the first three stations I tried were sold out.

    I guess it could be worse, I could be in California: can’t fill up the tank and can’t recharge the electric car.

    2. I could be in California: can’t fill up the tank and can’t recharge the electric car.
      This is the greatest part of CA’s “only all electric cars by 2035.” They can’t even keep the A/C on now and they want all Electric cars? Are they f##in nuts? I can see CA’s future! Either A) they put old Gas and Coal fired power plants on line, (too late to build many new power plants based on CA hatred of fossil fuels) or 2) everyone has to stay home, bike or walk and the CA love affair with Cars ends. Of course, a Cynic might say that Outcome #2 is the Climate “lock downs” people are talking about possibly being forced upon us. Each person get their own Carbon rating.

      2. everyone has to stay home, bike or walk

        Public transport will be free. Everything will be delivered to your door by drone. You will own nothing and you will be happy…

  20. Today is Tuesday, June 29th, and Joe Biden is not the legitimately elected president of the United States.

    The 2020 election was stolen.

  21. Everyone except Fed officials realize that the Fed has blown up another ginormous housing bubble.

    1. The Financial Times
      US economy
      US home prices rise at fastest pace in more than 30 years
      Data underscore ‘truly extraordinary’ market frenzy that has caught Fed officials’ attention
      A For Sale sign outside a house
      US home prices surged last year as Americans took advantage of record-low mortgage rates and snapped up houses in the suburbs
      Mamta Badkar in New York
      11 minutes ago

      US home price growth accelerated in April at the fastest pace in more than three decades as strong housing demand continued to come up against a shortage of residential properties.

      The S&P Case-Shiller national home price index, which covers all nine US census divisions, rose 14.6 per cent year on year in April, data on Tuesday showed. That followed a 13.3 per cent annual jump in March, and was “the highest reading in more than 30 years,” according to the report.

      Meanwhile, the 20-city composite, which covers US metropolitan areas including Dallas, Miami, New York and San Francisco, rose 1.6 per cent from the previous month and 14.9 per cent year on year.
      …

    2. Everyone except Fed officials realize that the Fed has blown up another ginormous housing bubble.

      Bullsh!t. It was intentional. These guys are dangerously arrogant.

  22. A vaccine is a biological preparation that provides active acquired immunity to a particular infectious disease.

    “We’re already seeing preliminary numbers out of Israel where fully vaccinated people are getting sick.”

    That’s not a “vaccine.”

      1. “We’re already seeing preliminary numbers out of Israel where fully vaccinated people are getting sick.”

        Um…then what was the point of getting fully vaccinated?

    2. Here it comes , here it comes now,
      The Delta Strain ,oh yeahhhhhhhhh

      So how long did opening up last and back to the masks and who knows what. Are they using the same PCR test to determine the DELTA?
      What did we get in California but about two weeks of a little let up from lockdowns.

      2. Here’s the thing: other countries have been locked down like Fort Knox since last year, so natural immunity never developed (and the vax doesn’t work). So every time they briefly reopen, the infection rate shoots up and they immediately lock down again.

  23. The Democrats, a criminal enterprise masquerading as a political party, fear nothing more than honest, competent law enforcement or judicial officials. As such, their first priority is to defund or otherwise weaken police forces, while installing Soros-backed DAs who will subvert and undermine the criminal justice system from within. Similarly, since criminals are a core Democrat constituency, the DNC has made it a top priority to restore the voting rights of convicted felons. As a huge crime upsurge results from Democrat malgovernance and “hug-a-thug” criminal justice policies, expect Democrats to attempt to downplay the severity of the problem or claims reports of soaring crime are rayciss.

    AOC is slammed for saying fear about nationwide rise in violent crime is just ‘hysteria’ – despite four tourists getting hit by stray Times Square bullets in last two months and murder rate up 533% in Portland

    https://www.dailymail.co.uk/news/article-9736879/AOC-faces-backlash-saying-concerns-crime-spike-hysteria.html

    Alexandria Ocasio-Ortez has come under fire for saying there was ‘hysteria’ across the United States over the surging violent crime rates, including a 64 percent spike in shootings in her native New York.

    The New York congresswoman made the comment on Sunday while discussing concerns of the rising crime wave across the country.

    1. Yeah, they’re “stealing bread to feed their families”

      Is her narrative. Vibrancy plus more vibrancy minus police equals a lot of dead vibrants.

      Now whitey knows the only reason you globalist ticks, you tapeworms, you parasitic species, allow whitey to stay alive is to tax whitey and provide infinite gibs to vibrants.

      Globalists, do you remember what July 4th, 1776 was actually about? It was a bloodletting, gushing from the slit throats of tyrants.

      Globalists, you have names, you have addresses. Weaponized autists of 4chan, please deal with them accordingly 😉

      1. Now whitey knows the only reason you globalist ticks, you tapeworms, you parasitic species, allow whitey to stay alive is to tax whitey and provide infinite gibs to vibrants.

        Plus someone has to keep the lights on.

  24. Is a basic economic concept wrong: “you can withdraw monetary stimulus without economic damage”?

    I think it is wrong is because monetary stimulus provides a narrow boost to the financial and sectors boosted by government spending. It doesn’t create broad based economic growth because the economy, like an organism, efficiently grows around that source of nutrients. Reduce that nutrient and you get an economic downturn in those sectors. Sectors likely responsible for the dashboard indicators that policy-makers monitor.

    Americans are good at building out businesses in sectors where they see profit. Like, if you artificially suppress prices and profit, industry will move away from that sector (it seems to me – example?). If you artificially boost prices and profits (your uncle Fred regularly buying out your lemonade stand), industry will move to that sector.

    Now let’s look at the two times in the past 13 years since the GFD (Great Financial Debacle) that the Fed has tried to withdraw monetary stimulus, once in 2013 and once in 2018-2019. You had the taper tantrum (2013), then the Christmas stock market bloodbath (2018) and the repo market failure (September 2019).

    The primary goal of the Fed, before being given its public mandates in 1977, was to fund the US government and backstop the financial system.

    Monetary stimulus seems to be like riding a tiger: once you get on, you cannot get off without being eaten. Is monetary stimulus a siren song? Money printing is money printing no matter how skillfully you do it?

    We talked years ago about the apparent absurdity of responding to a debt crisis with more debt; and that if money printing could bring prosperity, Haiti and other lower-development nations would be prosperous in short order. We were told that was too simplistic, we didn’t get it, and the next 13 years showed our folly and their correctness. Or has it? Is the timeline just longer than a few months. Maybe this plays out over a decade or two?

    1. The rhetoric around using asset price inflation to create universally beneficial “wealth effects” conveniently ignores the redistributional effects of Quantitative Easing measures.

      Notwithstanding financial alchemist claims to the contrary, wealth cannot be electronically printed, any more than lead can be transmutated into gold.

      1. “Of course, that cheap money could overheat housing values to a degree that the market suffers yet another collapse. That calamity might slash prices, creating chances for more California renters to join the privileged ownership group. Unless, the nation comes to ownership’s rescue — again!”

        Yep…

    2. Hi Neuromance

      I found this post of yours very enlightening (acutally saved it for future reading)
      You are right, if zimbawae and ARgentenia could have printed their way out of problems, it would have worked.
      Perhaps the FED knows when to hit the gas and when to ease off, just when the inflation starts becoming runaway? I dont know, but i reckon alot of investors (gamblers) are assuming the FED has it figured out. I realize this is all a delicate balance, When reality sets in, faith in the FED AND USD will be lost very quickly.

  26. one of the comments:

    ‘ Biden comments: “That building just pancaked, man. I like pancakes. But not those kind. Back in Scranton, mom used powdered sugar. Thank you, Miami! Get out and vote next Tuesday!” ‘

    1. LOL. Joe Biden is a more gregarious but sociopathic Chance the Gardener (“Being There”).

  28. Note that there are no high resolution images of the Surfside condo collapse in the media, and freelancer high resolution imagery is being deleted from social media. No drone HQ drone footage either. The 1st Amendment is being controlled.

      1. Even worse, regular schmoes might start having reservations about condos altogether. How is Klaus Schwab going to herd us into high-density, wall-sharing cities if we all start instinctively leaning toward a single-family home on even a one-fifth acre of arable land? IMO that was a big driver in the pandemic real estate push. Look how quick Blackrock started snapping up those precious SFH to force the unwashed into renting.

  31. ‘We’ve got a lot of people willing to buy. And even though home prices went up, obviously, it’s ok. It seems like a very palatable increase in prices. As much as they are higher, appraisals are staying up and it feels a little less like a house of cards than maybe in 2008 might have felt.’

    I visited Springfield, Missouri a few weeks ago on a family vacation trip. The commercial real estate downtown looked like an economic wasteland…even my wife commented on the apparent state of depression without prompting. The homeless people swimming in the city fountain at the downtown square was an interesting touch.

    But perhaps their housing market is different…red hotcakes, etc.

  32. How will criminals who rely on cryptocurrency for international money laundering purposes manage the regulatory crackdown currently underway?

    1. The Financial Times
      Opinion Binance
      The Binance stand-off shows bitcoin’s limits
      Without easy links to the banking system, crypto platforms lack mainstream appeal
      Binance’s woes stem directly from the UK’s 2020 move requiring crypto asset companies to register with the FCA
      Brooke Masters yesterday

      What’s the point of making a killing in bitcoin if you can’t spend the loot?

      Customers of Binance, one of the world’s largest cryptocurrency exchanges, are confronting that question after their accounts were suddenly cut off from one of the UK’s main payments systems.

      Days after the Financial Conduct Authority ordered Binance to halt all regulated activities in Britain, the digital asset company stopped allowing its customers to withdraw pounds via Faster Payments, a service used by high street banks. Bank card transfers in pounds were also halted.

      Binance insists that the FCA ban does not affect its business and says the links are being reinstated. Customers could still transfer their holdings to other platforms. But the sudden halt highlights a key issue for the freewheeling world of cryptocurrencies. With the notable exception of El Salvador, no country uses bitcoin as legal tender — and even Elon Musk has backed off plans to accept it as payment for Teslas. Instead, crypto holders must find ways to convert it into fiat currencies.

      Therein lies the rub. Regulators who have spent decades battling money laundering and terrorist financing are not about to welcome floods of anonymous money from unsupervised digital coin exchanges. The anonymity of bitcoin and some of its competitors is demonstrably popular with cybercriminals and tax evaders.
      …

      1. Richardson Man, Alias ‘Doctor Bitcoin’, Pleads Guilty to Cyber-Crime Scheme
        Simone Carter | June 30, 2021 | 4:00am
        Doctor Bitcoin is in trouble.

        Looks like the doctor’s out.

        “Doctor Bitcoin,” the self-given nom de guerre of a 42-year-old Richardson man, pleaded guilty on Tuesday to an illegal cash-to-cryptocurrency scheme, according to court documents.

        Mark Alexander Hopkins converted up to $1.5 million into Bitcoin for a customer running a lottery scam with a Nigeria-based co-conspirator, documents show.

        For at least a year, Hopkins ran a business converting U.S. dollars into cryptocurrency — for a fee. He neglected to verify customers’ personal data, flouting anti-money laundering regulations aimed at rooting out unlawful activity.

        Hopkins has pleaded guilty to one count of operation of an unlicensed money transmitting business, according to the U.S. Attorney’s Office for the Northern District of Texas.

        “This defendant ignored federal law and allowed fraudsters to use Bitcoin to operate under the radar of law enforcement,” Acting U.S. Attorney Prerak Shah said in a press release. “We are determined to rid the Bitcoin marketplace of anyone who knowingly helps criminal actors stash illegal profits inside crypto wallets.”
        …

  33. The URL says alot:

    veteran-investor-david-roche-says-the-market-bubble-will-come-to-an-end

    Markets
    Top investment strategist David Roche warns the Fed could burst a market ‘bubble’
    Published Tue, Jun 29 2021
    12:13 AM EDT
    Elliot Smith
    Key Points
    — The flagship U.S. stock index on Friday chalked up its strongest week since February.
    — This despite the rapid spread of the highly contagious new variant and lingering concerns over whether the U.S. Federal Reserve will be forced to scale back its unprecedented stimulus program.
    — Veteran investor David Roche said current valuations were a “bubble.”
    …

  34. Portland, OR Housing Prices Crater 22% As US Homeowners Slip Deeper Underwater

    https://www.movoto.com/or/97214/market-trends/

    As one national broker explained, “Remember folks… current asking prices of resale housing is 350% higher than long term trend and double construction costs. Now prices are falling.”

  35. “and those with low incomes will have all of their past-due rent paid by the state, under a bill signed Monday by Gov. Gavin Newsom in response to the COVID-19 pandemic.”

    Surprised more people aren’t commenting on this. “By the state means,” the middle class. So in addition to footing the bill for the deadbeats who don’t want to work, we now have to pay for their debts too. I guess Commiefornias deserve everything they get.

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