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Investors Threatened To Jump From A High-Rise Building To Protest Rapidly Declining Value

A report from KCCI on Iowa. “Ted Weaver, the president of the Des Moines Area Association of Realtors, tells KCCI the housing market is starting to stabilize. Weaver said if someone is selling right now, the price has to be realistic. Fewer homes are selling above list price. ‘The reason why it’s going down is because the inventory levels are starting to come up,’ Weaver said.”

From KOB 4 in New Mexico. “It’s getting easier to find a new house in Albuquerque. The real estate market took a wild ride over the past year and a half. ‘The last year has been, I think a fair word, especially earlier in the summer, was frantic,’ said Tego Venturi, co-owner of Venturi Realty Group. Venturi said he believes the market has downgraded from frantic to steady.”

From Realtor.com on California. “Ashton Kutcher and Lina Kunis have heaved their trophy home in Beverly Hills back onto the market, the Real Deal reports. The East Coast traditional is now available for the discounted price of $12.25 million. The stars had previously attempted to sell the posh property in June 2020, asking $14 million. Shortly thereafter, the home’s price dropped by $1 million, to $13 million. By October 2020, the mansion was offered for sale at $12.25 million—or to rent for $49,000 a month. After a couple of months, the listing came off the market in December 2020. Nearly a year later, it’s back.”

The San Diego Business Journal in California. “Luxury home buyers in San Diego have an array of pricey homes to choose from and the market remains strong, although it softened a bit, mirroring what’s happening in the overall housing market in the county. Not so long ago, anything over $1 million was considered luxury. ‘The norms of what we once defined as luxury have shifted,’ said Jay Becker, director of the Luxury & Coastal Group of Pacific Sotheby’s International Realty. ‘There are certainly buyers that still believe that $1.2 million is a luxury home and I wouldn’t deny them that feeling.'”

“Melissa Goldstein Tucci, an associate broker at Coldwell Banker West, said she’s seen ‘a slight cooling’ in the luxury market, cooling in the sense that sellers are still getting multiple offers, but fewer than a few months ago. ‘It’s not 10 offers, maybe it’s two or three offers, but the values are being upheld and the inventory level is still low,’ Tucci said. ‘People have the expectation that we’re going to put this on the market and get flooded with offers. That does happen sometimes, but it’s not happening as often.'”

The Real Deal on New York. “Affiliates of Ceruzzi Properties have agreed to a $29 million judgment after failing to make payments on a $155 million construction loan tied to the troubled Hayworth condo project. Executors of the estate of Louis Ceruzzi and BVS Acquisition Co. — an LLC tied to Ceruzzi Properties— will pay lender Children’s Investment Fund after allegedly defaulting as guarantors on the loan at the partially built Upper East Side tower, court documents show.”

“Children’s, a U.K-based hedge fund, was initially only seeking $10 million from the affiliates for failing to make interest payments between March and September 2020. But since Children’s filed its lawsuit in October, Ceruzzi failed to make any additional payments, increasing the amount owed to $29 million. Guarantors of the Hayworth project’s loans are facing challenges with other lenders besides Children’s.”

“There are ‘numerous lenders who are seeking payment and our client is trying to resolve them,’ said Neil Leiberman, who represents the executors of Ceruzzi and BVS Acquisition, during a July hearing, court documents show. In March, Industrial Bank of Korea filed a lawsuit seeking $40 million in damages after Ceruzzi allegedly defaulted on a $110 million loan backing Centrale, a 72-story, 124-unit condo tower in Midtown East. The state-owned bank was acting as trustee for an investment trust.”

“Children’s, meanwhile, has provided loans to some of New York’s largest developers, including HFZ Capital. A Children’s subsidiary is seeking to foreclose on HFZ’s stake in its luxury condo development known as the XI on the Far West Side.”

The Daily Mail Australia. “Real estate data group CoreLogic’s Pain and Gain report has revealed sellers are making a median return of $123,000 by selling after two years. But the gains weren’t evenly distributed with houses in both capital cities and regional areas surging as apartment sellers suffered in parts of Sydney, Melbourne, Perth, Darwin, Brisbane and the Gold Coast. CoreLogic’s head of research, Eliza Owen, said record-low interest rates had pushed up house prices as high-rise apartment sellers suffered from the absence of international students.”

“A closer look at the numbers by council area shows where profitability levels were well below the national average, especially in parts of Sydney with an oversupply of apartments. Burwood, in the city’s inner west, had a profitability level of 81.7 per cent with median losses of $70,000. The Parramatta council area had a profitability level of 85.4 per cent and a median loss of $49,000 in a region that covers Sydney Olympic Park, the home of the troubled Opal Tower.”

“The problem of falling unit prices wasn’t confined to Sydney. In April, May and June, 4,900 apartments across Australia sold at a loss. Unit sales made up 30.1 per cent of resales but a disproportionate 54.1 per cent of losses. Sellers who made a loss typically held the unit for 7.3 years before putting it on the market, compared with eight years for apartment owners who sold for a profit. Loss making unit sales were heavily concentrated in the Brisbane, Gold Coast and Melbourne council areas with those regions making up 23.9 per cent of loss-making unit sales.”

“Inner-city areas with lots of apartments were most at risk with the Perth council area having a high loss rate of 63.5 per cent compared with Darwin’s 39.3 per cent and Melbourne’s 34.8 per cent.”

The Vancouver Sun in Canada. “It’s not only the looming collapse of China’s largest house-builder, Evergrande Group, that has caused a shock to North America’s real estate and financial markets. The U.S. Federal Reserve, a pillar of the American establishment, has also published a report that zeros in on how wealthy buyers from the People’s Republic caused a ‘China shock’ on U.S. housing prices.”

“The report found an influx of buyers from China contributed to gentrification of neighbourhoods and caused lower-income people to move away. Why don’t Canadian officials produce something similar for this country, where cities like Vancouver, Toronto and Calgary have also been impacted? China’s housing bubble has been fuelled by massive housing speculation through companies like Evergrande. It’s contributed to oversupply and an estimated 65 million empty homes in China.”

“The company’s crisis resonates worldwide. The media has reported Evergrande, financed in part by the Royal Bank of Canada, owns many properties outside China. But beyond that Ottawa doesn’t offer much information on how much corporations or investors from China — or any country — own property in Canada. In an era of global free trade, federal politicians don’t want to know. Many also don’t want to rile China.”

“Unlike in the U.S., where central bank researchers look openly into foreign ownership, a certain faction have labelled Canadian researchers and politicians who try to get to the bottom of the phenomenon, or restrict it, as xenophobes.”

“So, as often happens in Canada, we end up relying on the Americans to expose developments occurring in our own country. Ottawa has a lot of catching up to do with the U.S. on providing information on housing (and money-laundering, for that matter). Much as Canadians make fun of Americans, they generally have a more transparent political, legal and economic system. The Federal Reserve’s 60-page study is an example. It’s titled Capital flows, asset prices and the real economy: A ‘China shock’ in the U.S. real estate market.

From AFP on China. “Another payment is due this week on a separate bond after Evergrande appeared to miss a payment last week. A slowing population has also hit property demand. ‘The root of Evergrande’s troubles… is that residential property demand in China is entering an era of sustained decline,’ Capital Economics chief Asia economist Mark Williams said in a note.”

The Washington Post. “The imminent collapse of Evergrande, the world’s most heavily indebted real estate developer, marks the end of China’s housing boom. Scrutiny of the highly leveraged property sector fits squarely in that broader trend. ‘Evergrande is not the only source of the debt problem, it’s an exemplar of the broader problems in the property sector,’ said Logan Wright, director of China markets research at Rhodium Group, a research firm. ‘It’s exceptional because of size, not methods.'”

“So far, public anger has largely been directed at Evergrande and its billionaire founder, Xu Jiayin. On Monday, a video of an Evergrande creditor yelling at the company’s executives for ‘throwing money into the dirt’ with spending on private jets and villas was shared widely on social media. Yet, further contagion that leads to plummeting house prices could spark a larger public backlash against government policies. Property accounts for 80 percent of household wealth. Past falls in housing prices often sparked protests from middle-class homeowners who bought apartments assuming their value would increase.”

“In Zhangjiakou, a city of 4 million that will host Alpine skiing events during the 2022 Winter Olympics, prices had already dropped by 40 percent before the government intervened. Only 50 minutes from downtown Beijing by high-speed rail, the city in recent years has been a popular destination for investors who snapped up new apartments hoping to sell them at a markup.”

“Even before Evergrande’s crisis, the struggle to break even was distressing some Zhangjiakou homeowners. In July, local police detained a man and a woman for 10 days for ‘disrupting public order’ after they threatened to jump from a high-rise building to protest their recently purchased apartment’s rapidly declining value.”

This Post Has 107 Comments
    1. This one is the most accurate to your headline I’ve seem yet. Price per square foot is down. I believe ppsf is the proof.

          1. No, I’m saying, by what metric are you going by that home values are falling? You can’t go simply by price since every home is different in size, acreage etc. You’d have to do some Comparative Analysis’.

  1. ‘Much as Canadians make fun of Americans…’

    How’s that mouth hankey thing working out up there?

    ‘…they generally have a more transparent political, legal and economic system. The Federal Reserve’s 60-page study is an example’

    Note that report hasn’t seen the pages of the Washington Compost, or any other globalist scum rag to my knowledge.

    ‘a pillar of the American establishment’

    Yeah, that’s why they do insider trading and are forced to quit in disgrace.

      1. I love their lies. Their lies infect their real estate-buying mark’s fragile dumbed-down minds and persuades them to flock into my bank so as to willingly sign any document I choose to place before them.

        My favorite document is my thirty-year Debt Slave Special of which I gratefully receive a sinfully hefty fee immediately after their signing and some hefty chunks of their hard-earned wages over the following thirty years.

        They work, I reap.

  2. ‘The root of Evergrande’s troubles… is that residential property demand in China is entering an era of sustained decline’

    Turn out the lights the party’s over
    They say that all good things must end
    Call it a night the party’s over
    And tomorrow starts the same old thing again

    What a crazy crazy party never seen so many people
    Laughing dancing look at you you’re having fun
    Look at me I’m almost crying but that don’t keep her love from dying
    Misery calls for me the party’s over

    https://www.oldielyrics.com/lyrics/gene_watson/turn_out_the_lights_the_partys_over.html

  3. ‘In July, local police detained a man and a woman for 10 days for ‘disrupting public order’ after they threatened to jump from a high-rise building to protest their recently purchased apartment’s rapidly declining value’

    Now that’s some red hotcakes!

  4. ‘There are certainly buyers that still believe that $1.2 million is a luxury home and I wouldn’t deny them that feeling’

    This is why yer called Californian.

      1. 9/17/2021 Price change $980,000
        9/6/2021 Listed for sale $1,027,000
        9/5/2021 This home was evaluated, repaired and prepared for listing by Zillow partners
        8/17/2021 Sold to Zillow $1,012,049
        6/12/2019 Sold $670,000

        Zillow must have scrubbed some information between 2019 and 2021. Plain-jane shack bought and likely reno-ed in late 2019. Then somehow, the flipper didn’t list the property, ever, during an 18 month buying frenzy. 🤔 Then they sell, during a downturn, to Zillow for $300K profit. Zillow repairs and prepares for sale in the space of *one day* (this is why I believe it was reno-ed previously), and re-lists for a hefty $15K profit. Then they cut the price, guaranteeing a $30K loss. Still no takers.

        WTH is this behavior? Is Zillow laundering VC money? That’s the only explanation I can think of.

        I don’t believe Zillow is correct in a 7900 sq ft lot. It looks like half that. BTW in my nabe, that house would sell for $425K, maybe, fully reno-ed.

  5. I guess I’m not the only one who is seeing those southbound Greyhounds with Texas plates on I-95

    DeSantis opens new fight with Biden over immigration

    By GARY FINEOUT 09/28/2021 04:15 PM EDT

    TALLAHASSEE — Florida Gov. Ron DeSantis on Tuesday escalated his fight with the Biden administration over immigration, directing Florida agencies to stop assisting federal authorities in relocating migrants.

    The Republican governor also called on state law enforcement officials to “audit” large private companies to ensure their workers are legally permitted to work in the U.S. and encouraged Florida authorities to detain buses, planes or cars “reasonably believed” to be transporting someone who entered the country illegally from the southern border.

    https://www.politico.com/states/florida/story/2021/09/28/desantis-opens-new-fight-with-biden-over-immigration-1391464

    1. Tens of thousands of military age males crossing the border illegally?

      That sounds like a criminal invasion.

      FJB

    2. I live in Florida. The illegals have been flooding in. I mean flooding in. The DS is determined to ruin our state. The population has changed before my eyes in 3 years. My favorite beach in an upscale area changed from white families to Spanish speaking and “other” in one year.

      1. ** “I live in Florida. The illegals have been flooding in. I mean flooding in. The DS is determined to ruin our state. The population has changed before my eyes in 3 years. My favorite beach in an upscale area changed from white families to Spanish speaking and “other” in one year.”

        Reconquista: “welcome to the party, pal!”

          1. Yep, that’s the crap I hear in Utah, how this land was originally Mexico’s, so everyone from the south should be able to live here. I have asked if the Mexicans created irrigation systems and made the valley livable in the 19th century, but people don’t like that question when they are busy virtue signaling.

    1. Agree with Eric. Another good one. Like it or not PPSF is what realtors use for comps. Appreciate you sharing this info.

  6. ‘The reason why it’s going down is because the inventory levels are starting to come up,’

    The reason why the inventory levels are starting to come up is because the prices are going down.

      1. It reminds me of those treehuggers from the 1990s who said “I have a bike, I can get to the store for groceries.” Evidently it didn’t occur to them to ask how the groceries were going to get to the store.

    1. At some point, the demand for $100,000 pickup trucks will be affected. How many people can really afford the entrance price, much less the cost of licensing, insuring and operating them? And then there’s the demand thingy for the RVs that they tow….I can see a massive price crash coming.

        1. Out of curiosity, I looked up Edmunds for Silverados and Ford 150s. They run around $50K depending on trim. What is the difference between these sexi-trux? Yeah, this Laramie looks a little bigger, but not twice-the-cost bigger.
          What am I missing?

          1. First of all, it’s a RAM 3500, which makes it comparable to an F-350. Meaning it has a beefier frame and powertrain. It probably also has ever option imaginable, and it has a turbo diesel engine.

            Still, 100G seems a bit steep for a pickup, but apparently some rubes will pay that much.

          2. “…Silverados and Ford 150s.”

            Colorado is correct, no comparison to an F-150 series. A 1/2 ton pickup is basically a station wagon that looks like a pickup truck. That truck I linked is designed to haul a 5th or 7th wheel luxury RV trailer.

          3. Right. It is a Class 3 truck. Ram 1500s and F150s are Class 1. Ram 2500s are Class 2. Ram 3500 Class 3, all the way up to Class 8 which are the 18 wheelers you see on the highway.

  7. The Financial Times
    Evergrande Real Estate Group
    Evergrande sells $1.5bn bank stake to state-owned enterprise
    Debt-laden Chinese property developer faces worsening liquidity crisis as second interest payment due
    Evergrande missed an $83.5m interest payment on a dollar-denominated bond last week. The company’s woes have triggered concerns about China’s property sector, a leading driver of the country’s economy
    Thomas Hale in Hong Kong and Edward White in Seoul yesterday

    Evergrande has raised Rmb10bn ($1.5bn) by selling part of its stake in a bank to a state-owned investment group, as the heavily indebted Chinese property developer battles for survival amid mounting pressure over bond repayment deadlines.

    The company said on Wednesday it had sold a 20 per cent stake in Shengjing Bank, based in the northern city of Shenyang, to Shenyang Shengjing Finance Investment Group, which is owned by local authorities.

    Evergrande will retain a 15 per cent stake in Shengjing Bank, which is “demanding” that the net proceeds from the sale be used to settle liabilities the group owes to it, according to a regulatory filing.

    1. If they continue selling off the company piece by piece at fire sale prices to pay off creditors, how soon will they have nothing left to sell, and how large will the remaining unpaid balance be?

        1. arriving olympic tourists to china will be carrying 3 signs:
          1) GO TEAM USA!
          2) JUMP, YOU FU**ERS!
          3) REALTORS ARE LIARS!

          (or maybe 1 reversible sign & a USA hat.)

  8. “Only 50 minutes from downtown Beijing by high-speed rail, the city in recent years has been a popular destination for investors who snapped up new apartments hoping to sell them at a markup.”

    I’m starting to suspect that the Chinese real estate investing craze was worse than America’s. Not to suggest that many of the investors in the U.S. mania were not Chinese nationals investing abroad…

    1. I’ve been cruising the St. Lawrence for the past two months and have seen lots of deep water cargo ships returning to the Great Lakes. Not one of them had containers on deck.

    2. I guess those plans to build a mega port in Mexico, and to transport the containers by railroad to the US border never panned out.

    3. It’s crazy; I’ve never seen anything like it. There’s even ships hanging out in the swell shadow from Catalina – just a few miles off Avalon.

      1. R u in Avalon!?

        My wife and I took the Long Beach ferry there for a mini vacation this past April. I pointed out to her the long line of container ships waiting to offload at the Long Beach port. I guess the problem has only worsened since then.

    4. ** “As an estimated 500,000 containers are sitting on cargo ships off the Southern California coast, many are wondering how to handle the backlog”

      what, are you KIDDING ME?!? easy peasy
      just get the word out they are full of catalytic converters, meth & video game(s)/consoles

      do i have to solve EVERY problem?! c’mon man

  9. I was reading the wikipedia entry about the first head of the New York Fed, Benjamin Strong Jr. They kept referring to this concept of the “sound bank” and how lending money to “sound banks” could stave off bank runs.

    I kept thinking – there’s no such thing as a sound bank. They’ve always been allowed to lend out some percentage of consumer deposits (today the that “reserve ratio” is 10% – they can loan out 90%). The only way the fractional reserve banking system can exist is with a money printer at the center of it. Fractional reserve banking is the Original Deception (like Original Sin) of the financial system.

    And imagine before creation of the central bank – the bank owners would not be the ones losing money in a run as they’re paying themselves as they go along.

    If that money printer at the center of the system can be operated with restraint and in a limited fashion, the system can be stabilized it seems. But then… when they want to push the stabilizer as far as it can go to see how unstable THAT system can be (all the while enriching themselves a la the pre-central-bank bank owners)… well, interesting times I guess.

    1. today the that “reserve ratio” is 10% – they can loan out 90%

      Hasn’t been so for a long time in practice.

      1. I marvel at how precarious the system was for depositors, originally. And wonder about the mindset of the people who created it.

        “It’s brilliant! It just works.” Until it doesn’t.

        It seems like seatbelts. The overwhelming majority of the time they are not necessary. Until that one time they are. But I guess if one is making money off of people driving without seatbelts, and if “everyone is doing it” (driving without seatbelts), the risks seem acceptable.

    2. Mike Maloney has an entire YouTube series on this: “The Secret History of Money,” where he uses animation to illustrate how fractional banking creates currency.

      And the system WAS precarious for depositors — we had a whole Depression about that. Nowadays, Jay and Janet will print you $250K if needed. We’ll get our dollars, but will they buy anything? Doubt it.

      1. Mike Maloney has an entire YouTube series on this: “The Secret History of Money,”

        Good series. While watching though, remind yourself he’s trying to sell gold.

          1. To be fair, Maloney created the series over 5-6 years, from 2012-2017 (or close). He meant it to be aired by PBS, but for some reason decided to keep it himself. It’s got PBS-quality production value so it’s easy to watch.

            Yup, I know Mike sells gold and silver, but almost everything he says is still accurate.

          1. not worth listening to

            On the contrary, I learned a lot from the series but wasn’t so scared to buy gold.

          2. don’t trust what you think you’ve learned. it’s wrong.

            he says the dollar has lost 95% of its value since the FED was created. that’s true, but he doesn’t know or doesn’t want to tell something else. that at the average wage of 1913 it took twice as long to earn an ounce of gold despite the dollar losing 95% of its value.

            he gets lots of things wrong.

          3. don’t trust what you think you’ve learned

            I’ve learned to discount information by a factor corresponding to my trust in a source. Any factor over zero has some value.

      2. Those debt instruments are not money. But aside from that tiny inconvenient fact, all depositors are now debt holders. The bank owns all deposits.

        1. Maloney is very strict about the difference between “money” and “currency.” On his YouTube show, if you say “money” when you should have said currency, he’ll honk you.

    1. Just curious if there are any HBBers who still believe there is a plan to end the “pandemic” return to “normal”. Is there anyone who would disagree that the actual plan is a permanent state of emergency in which all of your rights, freedom, and prosperity will be stripped away and you will be left nothing but a digital ID that the government can disable on any whim?

      1. The pandemic will end in a year or two. Some changes may become permanent, though (e.g. more telework with remote residential location and virtual meetings, coupled with less commuting and business travel, including costly plane flights and hotel stays).

      2. As long as it works and keeps the plebs in check, I see no reason to end it. But if it stops working, then they will trot something else out. Climate lock downs perhaps.

        1. They want to keep it going, that’s for sure. I’ve been hearing noises about two things:
          1) as long as we need masks, we’re going to have restrictions X Y Z.
          2) we’re going to need masks forever to until this is “under control,” which means whatever they want.

          In other words, restrictions forever.

          1. The entire charade is an utter fraud.
            Face diapers have no effect other than to make the wearers look like morons.

      3. there is a plan to…return to “normal”

        We don’t need a central planer to return us to normal. Just the opposite.

      4. It probably depends on your perspective / location. Things are pretty back to normal for us. We went to the TX state fair on Friday, opening day. It was pretty awesome, 80 degrees, low humidity, short lines, 9.2%ABV double IPA on tap, $280 and 6 hours later, we were bushed! I’m in the office everyday, kid is in school, etc. We did have to wear a mask on a recent plane trip, but that’s it. We were in CA a couple times over the summer, other than wearing a mask at the grocery store, it was tits out. Beach was fun, woods were nice, zoo was open, kids went to swim at MIL’s health club, etc.

        I guess the people who work in healthcare and have to decide between getting vaxed or losing their job have a tough decision to make. That’s the nature of private business though. Ross Perot used to require people wear only certain suit colors at EDS, nurses in skilled nursing have to take the flu shot every year, etc.

        1. San Diego Unified School District board approved a COVID-19 vaccine mandate for all eligible employees and students (16+) by unanimous vote last night. I expect other school districts in the county to follow.

        2. getting vaxed or losing their job
          There needs to be, at a minimum, an exclusion for people who have been infected. Assuming the Israeli data get peer review approval I don’t see how demanding a vax for a previous infected individual makes sense.
          In fact, maybe the employers, since those with natural immunity have stronger/more robust protection than those vaxxed, should required that everyone must get the virus, you know, just for safety reasons.

          1. I am a bit surprised that there are still people who think that they are going to willingly let this go and leave people alone. Not gonna happen.

          2. None of it makes sense. The whole scheme is that, if you accept the premise, you will be forced to accept their solutions. They don’t care what does or doesn’t make sense. The goal is compliance.

  10. “The U.S. Federal Reserve, a pillar of the American establishment, has also published a report that zeros in on how wealthy buyers from the People’s Republic caused a ‘China shock’ on U.S. housing prices. The report found an influx of buyers from China contributed to gentrification of neighbourhoods and caused lower-income people to move away.”

    This happened to our next door neighbors…a single mom with three kids. I gave myself a hernia helping her boyfriend move their entire household over one weekend. The Chinese investor overpaid by $50K, several years ago. He smoked and yelled a lot at his wife. They suddenly disappeared a little over a year after moving in.

    1. PS I suspected the investor wasn’t wealthy, but he did manage to borrow a lot of money to finance his boondoggle investment.

  11. Why does gold and silver continue to crater day after day? Gold and silver are cheaper today than they were 10 years ago.

      1. Why buy gold and silver when prices are falling? Buy it later after prices crater for 45% less.

  12. Did you already offload all your dollars on risk assets, like stonks, imaginary currencies, and real estate? That’s an unfortunate financial situation to be in at a time of rising risk premiums.

    1. The Financial Times
      Markets Briefing Capital markets
      Dollar hits 1-year high as traders anticipate rate rises
      Jay Powell warns ‘frustrating’ supply chain bottlenecks will persist
      The Federal Reserve building in Washington DC
      The Fed has signalled it is ready to reduce its $120bn asset purchasing programme
      Naomi Rovnick in London
      32 minutes ago

      The US dollar traded at its strongest level in a year against major currencies as traders banked on persistent inflation driving the Federal Reserve closer to its first pandemic-era interest rate rise.

      The dollar index, which measures the US currency against six others including the euro and sterling, hit its highest level since September 28 2020, following days of choppy trading on financial markets after central bank officials signalled the end of ultra-supportive monetary policies.

      Headline inflation in the US is running at around a 13-year high after economies reopened from last year’s shutdowns, creating supply chain bottlenecks.

      The Fed last week raised its inflation forecasts and indicated that it would reduce its $120bn a month of bond purchases that have boosted lending and spending through Covid-19. It said half of its monetary policymakers now expected an interest rate rise next year.

      Fed chair Jay Powell, who for much of this year characterised price pressures as transitory, on Wednesday warned that “frustrating” inflationary pressures would persist.

      “We are seeing persistent and broad-based inflation in the US and Europe,” said Tatjana Greil Castro, co-head of public markets at bond investor Muzinich.

      Powell has now “prepared the market” for the Fed to reduce its bond purchases from November, which “leaves open the possibility of the first rate hike being delivered during the second half of next year”, MUFG Bank currency analyst Lee Hardman said.

      The income yield on the benchmark 10-year US Treasury note, which informs the valuations investors are willing to pay for higher-risk equities, was flat at 1.527 per cent on Thursday but has climbed from around 1.3 per cent just over a week ago.

  13. Got shortage?

    The Financial Times
    Automobiles
    US car shortage hits everyone from dealers to junkyards
    Semiconductor supply problems are having widespread effect in a country with 276m registered vehicles
    The Bowman Chevrolet car dealership in Michigan
    At Bowman Chevrolet in Michigan, the typical 90-day inventory has dwindled to less than two
    Claire Bushey in Chicago yesterday

    Eight out of the 10 Chevrolet Silverados had been sold even before they arrived at Katie Coleman’s car dealership this month. The other two disappeared a few hours later.

    That is how fast vehicles have been selling as the chip shortage continues to grip the auto industry. Coleman’s typical 90-day inventory has dwindled to less than two. Her dealership, Bowman Chevrolet outside Detroit, has even sold a fleet of “loaner” vehicles that had previously been lent to customers whose cars were being repaired.

    “We wish we could drive bikes so we could sell [our own] cars,” Coleman joked.

    1. State Of Chip Shortage: Blame Bitcoin For The Long Wait For Your New Car And Sony PlayStation 5?
      Intel chip; Image for representation (Image: Reuters)
      Intel chip; Image for representation (Image: Reuters)
      Why are we facing a severe semiconductor shortage? Multiple reasons including order backlog from the COVID months, Bitcoin and slow expansion of manufacturing capacities.
      Vishal Mathur
      Updated: June 15, 2021, 11:56 IST

      Semiconductors. Chips. You craved for all sorts of smartness with gadgets. You got all sorts of smartness with gadgets. From your toothbrush to your new car. What makes all this work? Chips. They are the backbone of pretty much everything around you. Be it your laptop or PC, your TV, your smartphone or even the good old Wi-Fi router you have at home, everything uses these to work. As does your car, and the newer the car, the more chips it is likely to integrate. You may have noticed over the past few months that the laptop you may have been eyeing is mostly showing as out of stock. And the car that you’ve booked, you’ve been quoted a waiting period that’s around 6 months, if not more. The common thread—the chips that make these smart, are in short supply. Serious chip anxiety, globally, across industries.

  14. GM to halt production at nearly all North America assembly plants due to new chip problem
    General Motors will idle the plants starting Monday for two weeks due to COVID-19 affecting the production of semiconductor chips
    Jamie L. LaReau
    September 2, 2021
    Detroit Free Press

    General Motors will idle nearly all its assembly plants in North America starting Monday as the COVID-19 pandemic affects production of semiconductor chips overseas.

    GM said its Arlington Assembly in Texas, where it makes its highly profitable full-size SUVs, will run regular production next week, along with Flint Assembly, where it makes its heavy-duty pickups, Bowling Green Assembly in Kentucky, where it makes its Corvette, and a portion of Lansing Grand River Assembly, where it will make some Chevrolet Camaro and Cadillac Blackwing cars.

  15. Pick your bottleneck: Ports, chassis, containers, labor
    Stretched chassis pools just part of supply chain headwinds, Direct ChassisLink says
    Todd Maiden
    Thursday, September 30, 2021
    5 minutes read

    The most recent metrics from the Port of Los Angeles show supply chain constraints are still hovering near record levels, a trend that is expected to carry into 2022.

    During a monthly update, Gene Seroka, the port’s executive director, said dwell times for containers remain at or near all-time highs, with “significant volume headed our way throughout this year and into 2022.”

    As of mid-September, dwell time for containers at terminals was six days, the highest since the volume surge began more than a year ago. On-dock rail wait time was 11.7 days, compared to the recent peak of 13.4 days, as four times the average number of containers were waiting to be loaded on railcars.

    The port’s Pool of Pools chassis, which are jointly managed by Direct ChassisLink Inc. (DCLI) and two other intermodal equipment providers, were waiting 8.5 days (8.8 days was the recent peak) on the street for space to open at the warehouses as “disruptions continue at every node in the supply chain,” Seroka said.

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