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The Juice Isn’t Worth The Squeeze

A report from the Oklahoman. “Landon Whitt, CEO of OKCReal, said he’s seen what may be some cooling in investor demand. ‘I have had three different investors get cold feet after placing an offer, and pull out of the deal, just in the last two weeks, all due to concerns about unstable returns,’ Whitt said. ‘Customers bringing cash above appraisal has ended for us since September.'”

The Motley Fool. “Jason Hall, and Matt DiLallo discuss what might have scared Zillow’s management so much that they decided to exit a major growth driver of the company so suddenly. DiLallo: ‘I question whether Zillow was doing this. Were they relying completely on the Zestimate? They’ve been pushing all these changes on the Zestimate, and I don’t know what you guys have noticed on your personal houses, but my Zestimate is just always way off for all the houses I’ve owned. It just seem like they realized way into it, they were way over their head, and it was just a little too late and the only thing they could do was to pull the plug. Otherwise, they’re just going to continue to blow up a bunch of money.'”

“Hall: ‘This is a business that if you’re really good at it, you can effectively use debt, and you don’t have to hang a ton of cash on every transaction, and the returns on that, the actual capital that you invest can be very good. The flip side of that is that it can compound the losses. I think they acted so quickly because they didn’t want to create a position where those losses were compounded, where the decent margins that they make in the good times were wiped out, plus a lot larger losses by the potential losses of trying to offload too much inventory in the wrong part of the season. By the way, what if there is a sudden slowdown in demand? I don’t think that’s going to happen just because there’s so little inventory in general, but I think they were thinking broadly about some sort of a black swan.'”

From Wealth Management. “Zillow’s recent disastrous exit from its iBuying business, spurred by its overpaying for homes in a highly competitive market that the company couldn’t then quickly flip at a profit, opened the question of how much these platforms might be disrupting the single-family home market and what role they will ultimately play in the trend toward more institutionally-owned SFRs.”

“Before Zillow’s meltdown, spurred on by its $1 billion in losses over the course of 3.5 years, the market share of national iBuyers rose to another all-time high, blowing past all previous records by a wide margin, according to Mike DelPrete, a real estate strategist who specializes in iBuying.”

“Zillow’s forecasts were off—by a lot. For example, Zillow Offers unit economics swung approximately 1,200 basis points from the second quarter to an expected -500 to -700 basis points in the fourth quarter of 2021, according to the company. ‘iBuyers can get into trouble if they pay above market for too many houses in a cooling market,’ DelPrete notes. ‘This results in a growing inventory of over-priced houses that are difficult to sell.'”

The Phoenix Business Journal in Arizona. “Local economists are wondering when this wild ride is going to end for a city that has been known for its affordability, a key reason why so may job-seekers have relocated to the region from California and other states.”

“‘With Phoenix remaining one of the strongest metropolitan areas in terms of year-over-year price gains, the question remains: when does this end,’ said Steven Hensley, advisory manager for Zonda. ‘It appears the answer could be soon. More recent home price data from October and November suggest there is considerable deceleration in prices throughout Phoenix. Also, given that Phoenix has ranked near the top in year-over-year price gains much of this year, the metropolitan area is unlikely to replicate next year because of how strong it was this year.'”

“House price appreciation is unsustainable at this point, said Kwame Donaldson, a senior economist for Zillow Group Inc. ‘Over the last year, average hourly wages in the U.S. increased by less than 5%,’ Donaldson said. ‘If house price growth were to routinely increase four times faster than wages, then housing affordability would become an issue for a larger number of Americans.'”

The Commercial Observer. “It comes across as a multimillion-dollar nightmare. The myriad things allegedly wrong with the high-rise condominium tower at 432 Park Avenue, the fifth-tallest building in New York City, are spelled out in a late September lawsuit in Manhattan Supreme Court, with lawyers for its residents calling it ‘one of the worst examples of sponsor malfeasance in the development of a luxury condominium in the history of New York City.'”

“There’s ‘horrible and obtrusive noises and vibrations’ due to that conspicuous height, the court complaint says. Elevators allegedly repeatedly shut down, not only trapping people inside the cars, but making for hours-long delays and denying occupants access to their condos. There was a recentexplosion, per the complaint, when a worker trying to repair water infiltration drilled through concrete and severed an electrical cable, cutting the feed to one of the building’s chillers and shutting down some of the air-conditioning. There have been two arc-flash explosions in the past three years.”

“TRD reported in late September that a four-bedroom unit at Extell’s Central Park Tower — at 1,550 feet, even taller than 432 Park — sold for $49.7 million, not the original asking price of $95 million. There have been 33 closings in the building, and the price has been an average of 25 percent below what Extell was aiming for.”

“‘Prior to COVID, the market was oversaturated,’ said Cesar Guevara, founder of MQ Realty, a brokerage that focuses on residential real estate in Manhattan and Queens. ‘There were a lot of projects that had started already, they had already been funded and there was a lot of stuff on the West Side, a lot of stuff in Midtown, a lot of the high-end luxury market just sitting there.'”

The Los Angeles Times in California. “The largest modern home in America could be auctioned in January starting at $250 million, its owner told a U.S. Bankruptcy Court official on Tuesday. Developer Nile Niami’s Crestlloyd LLC plans to hire two luxury home sellers to list the Bel-Air mega-mansion known as The One for that price and help find bidders for the auction, a reversal that could bring to an end a saga that has pitted a glitzy developer against a cadre of lenders.”

“‘We’re still going back and forth strategically speaking, but we anticipate that the listing price will be approximately $250 million,’ Crestlloyd manager Lawrence Perkins told the court. Outside of court, Perkins said the change of plans came after real estate experts who were consulted said any buyer would want to personalize the property — and therefore it made little sense to spend millions completing it. ‘The juice isn’t worth the squeeze to finish it, because someone’s just going to have to redo a lot of the work anyway,’ he told The Times.”

“The goal, he said, was to list the home and also schedule an auction to prevent buyer after buyer from getting cold feet. ‘What we don’t want it to do is drag on and on,’ Perkins said.”

From Newshub New Zealand. “First-home buyer activity has plummeted and real estate agents are seeing fewer buyers at auctions and open homes, a new survey shows. First-home buyers are pulling back for a variety of reasons, Tony Alexander told Newshub. ‘That’s a huge turnaround and will reflect not just the rising interest rates, but the CCCFA [Credit Contracts and Consumer Finance Act] changes, LVRs [ loan-to-value ratio restrictions] and DTIs [debt-to-income ratios,] all at the same time,’ Alexander said.”

“Cancellation of bank pre-approvals is another factor, he said. Fear of Missing Out (FOMO), has dropped to the lowest level since April 2020. A net 39 percent of real estate agents reported seeing evidence of FOMO in November, down from a gross 69 percent average over the last 19 months.”

From Bloomberg. “In less than two years, Chinese property developer Kaisa Group Holdings Ltd. has gone from being an up-and-coming player in Hong Kong’s property market to a desperate seller. As it strives to raise money to alleviate a liquidity crunch during China’s property deleveraging campaign, Kaisa has been reversing its expansion in the city with a series of asset sales in the past month.”

“It’s a dramatic volte face after founder Kwok Ying Shing and his family made headlines earlier this year with acquisitions ranging from land sites to luxury apartments and even a popular local newspaper. Now Kaisa, which became the first Chinese developer to default on offshore dollar debt in 2015, is trying to stave off a repeat that could come as soon as next week if bondholders don’t accept its plea for a lifeline.”

“The need for asset sales will become even more pressing if creditors don’t accept Kaisa’s request to swap its $400 million of notes maturing Dec. 7 for new ones due 18 months later. If the offer — which expires at 4 p.m. London time on Thursday — fails to win support, the struggling firm has said it may not be able to repay bonds and could consider a debt restructuring.”

“Kaisa’s woes have wiped out much of the Kwoks’ fortune. With shares slumping in all of the group’s trading units, the family’s wealth has plunged 85% to about $200 million from $1.3 billion in January, according to the Bloomberg Billionaires Index.”

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This Post Has 116 Comments

  2. ‘I have had three different investors get cold feet after placing an offer, and pull out of the deal, just in the last two weeks, all due to concerns about unstable returns,’ Whitt said. ‘Customers bringing cash above appraisal has ended for us since September’

    That’s about when the wheels flew off.

    Let’s go Landon!

  3. ‘This results in a growing inventory of over-priced houses that are difficult to sell’

    That’s some red hotcakes right there.

    ‘‘It appears the answer could be soon. More recent home price data from October and November suggest there is considerable deceleration in prices throughout Phoenix’

    As in reverse Steve. Why do you think zillow is taking such an a$$ pounding?

  4. volte-face
    /ˌvältˈfäs,ˌvōltəˈfäs/
    noun: volte-face; plural noun: volte-faces

    -an act of turning around so as to face in the opposite direction.
    -an abrupt and complete reversal of attitude, opinion, or position.

    ‘the family’s wealth has plunged 85% to about $200 million from $1.3 billion in January, according to the Bloomberg Billionaires Index’

    They aren’t billionaires anymore bloomberg.

  6. ‘I question whether Zillow was doing this. Were they relying completely on the Zestimate? They’ve been pushing all these changes on the Zestimate, and I don’t know what you guys have noticed on your personal houses, but my Zestimate is just always way off for all the houses I’ve owned’

    There are several answers Matt. Could be they were greedy for the stock market money sloshing around. But never eliminate the old straw up the nose syndrome.

  7. ‘That’s a huge turnaround and will reflect not just the rising interest rates, but the CCCFA [Credit Contracts and Consumer Finance Act] changes, LVRs [ loan-to-value ratio restrictions] and DTIs [debt-to-income ratios,] all at the same time’

    Doncha hate it when that happens Tony?

    1. I wouldn’t even walk in it to feed a hamster. It emanates disease and cooties. It’s a blight to the land and to humanity.

    3. The $90K is for the acre of land, probably. Even then it’s not worth 1/3 of that. ‘specially if it’s Water Haul utilities.

  10. If you expect Congressional GOP representatives to actually act like Republicans and represent their constituents back home instead of FIRE Sector lobbyists, you are, ipso facto, “far right.” The sellouts of the GOPe are finally being held accountable for being globalist fluffers by some of the upstart newcomers who have bilged corporate GOP empty suits in the Republican primaries.

    McCarthy faces headaches from far-right House GOP

    https://thehill.com/homenews/house/583938-mccarthy-faces-headaches-from-far-right-house-gop

    Kevin McCarthy is taking fire from all sides.

    The House minority leader and California Republican is facing a barrage of criticism from far-right lawmakers skeptical of his conservative credentials and loyalty to former President Trump.

    Vocal GOP Trump critics like Reps. Adam Kinzinger (Ill.) and Nancy Mace(S.C.), are pressing McCarthy to take a tougher approach with a small band of conservative rabble-rousers whose incendiary comments and antics have caused unnecessary distractions for the GOP.

    1. “The last thing you would ever want is for our elections to be managed in Washington, D.C.,” he added.

      …. or managed off shore through Philly.

    2. And mothers speaking for 5 minutes school board meetings are terrorists according to DOJ.
      The lexicon of the left is extremely inflammatory, unjust, anti American and loaded with contempt for basic good Americans.

  11. ‘If house price growth were to routinely increase four times faster than wages, then housing affordability would become an issue for a larger number of Americans.’”

    Kwame just earned the big bucks right there. I’d have never figured that out on my own.

  12. Do not declaw your cats! It makes them less effective as weaponized felines when you hide in trees & drop them on realtors who skulk into your neighborhood.

    1. Whenever I see a realtor in the neighborhood, I lock the door and immediately call the authorities.

  14. Gosh, I hope all the FBs who overstretched themselves financially to get up on that housing ladder don’t find themselves having to choose between making their mortgage payment or heating their shack.

    Cost of heating average home could DOUBLE in April with gas bill set to rise to £944-a-year due to increase in the energy price cap, charity warns

    https://www.dailymail.co.uk/news/article-10267253/Cost-heating-average-home-DOUBLE-April.html

    The cost of heating the average home could double next April after an increase to the energy price cap, a charity has warned.

    Fuel poverty charity National Energy Action (NEA) used industry data and forecasts to predict that the typical gas bill is likely to have gone up from £466-a-year in October 2020, to £944 in April 2022.

      1. Getting married and raising a family is expensive and fraught with peril given the number of corporations and government entities aligned to hobble your financial independence and liberty.

  16. Influence-peddling becomes more problematic when no members of the Clinton crime family hold official positions they can monetize. Coasting on past corruption means the revenues are going to plunge even more in 2021.

    Clinton Foundation donations plunged in 2020

    https://www.foxbusiness.com/politics/clinton-foundation-donations-plunged-2020

    Donations to the Clinton Foundation declined to $16.3 million in 2020, marking the smallest tally of contributions in several years, according to the organization’s annual financial report.

    The 2020 contributions plummeted compared to the previous year when the Clinton Foundation received $29.6 million. Donations are down nearly 75% compared to 2016, when the foundation received $62.9 million as former Secretary of State Hillary Clinton ran for president.

  17. “…The need for asset sales will become even more pressing if creditors don’t accept Kaisa’s request to swap its $400 million of notes maturing Dec. 7 for new ones due 18 months later….”

    I really hope Kaisa doesn’t flood the market with goldfish.

    1. hmm, real estate industry publicly acknowledges buyer slowdown.

      so at first it was buyers “couldn’t”
      purchase for lack of inventory.

      now they “wouldn’t” buy because ?

      soon moving to “shouldn’t” buy.

      couldn’t
      wouldn’t
      shouldn’t

      3 stages of real estate grief

  18. Globalist propaganda mouthpieces like Slate are predictably outraged that Red State governors are coming to the assistance of people forced out of their jobs for refusing to become guinea pigs for Big Pharma or submitting to Biden regime tyranny.

    Red States Are Now Paying Unemployment Benefits to Anti-Vaxxers Who Quit Their Jobs

    https://slate.com/news-and-politics/2021/11/red-states-are-now-paying-unemployment-benefits-to-anti-vaxxers-who-quit-their-jobs.html

    Republican governors have decided to coddle vaccine refusers, even as they cut benefits for everyone else.

    1. “Globalist propaganda mouthpieces”

      This is why we use the Archive website to share their links. I am not giving them a fraction of a cent of revenue by clicking on that link.

    1. Staffers are running from Kamala Harris like Ted Kennedy from a car accident.

      Two more Harris press aides leaving in addition to Sanders

      https://thehill.com/homenews/administration/583970-two-more-harris-press-aides-leaving-in-addition-to-sanders

      Two more press aides working in Vice President Harris’s office are expected to leave their roles in the coming weeks in addition to the two high-profile exits of her press secretary and communications director, a source familiar with the departures confirmed to The Hill

      Peter Velz, who is the vice president’s director of press operations, and Vince Evans, the deputy director of the Office of Public Engagement and Intergovernmental Affairs for Harris, are planning to leave those positions soon, the source confirmed.

  21. First case in Northern California of Omicron is a vaccinated person. Ca. News said mild symptoms.
    I believe the cases in South Africa were from vaccinated people .
    So, the insanity of Biden/Fauci urging people to get their vaccine/ booster based on African variant is the typical fear mongering absurdity of these vaccine pushers.
    If they use this variant as the new grounds for lockdowns , or cover for vaccine failure, It’s getting pretty ridiculous .

    1. Seems pretty mild so far. That’s encouraging.

      YouTube channel Medcram reported on sewage analysis in South Africa. COVID is shed into the wastewater system, so analyzing sewage provides a measure how much infection is in an area. It’s a good measurement in areas with low testing volume. Evidently in SA cases are increasing rapidly, but the virus levels in sewage are rising more rapidly than than positive tests. This trend points to a LOT more cases are happening than are being are being detected, possibly lots of asymptomatic or very mild cases. Also encouraging.

      However, I would prefer if the news reported which vaccine these people got and when. The vaccines all act differently.

  22. Starting from around 1912 the Rockerfeller based Medical Monopoly based on pharmacy based medicine has resulted in Big Pharmacy forced vaccines and a Medical Tyranny of epic evil.
    Your to take untested expiermental vaccines , just because they say so and the stakeholders get trillions , when the vaccines should not of been approved to begin with . They are hiding the adverse effects and deaths from vaccines, just as the yearly deaths from Pharmaceuticals in general has become acceptable as the third or forth cause of death.
    I heard a Talking head say that the Medical Cartel plans to have a vaccine for everything, so Big Pharmacy has no liability for anything if its labeled a vaccine.
    So , the overtake by Big Pharmacy of the Medical System is evident as well as the regulatory bodies like FDA, that has been captured and corrupted.
    So, I would say that at this point all pharmaceuticals are under no meaningful regulations by the Agencies of Government that are suppose to protect us.
    And the obvious failure of the Fauci/Biden protocol s to deal with a Pandemic is that they double down on this murderous failure, and censorship becomes even more necessary to push the outrageous narratives, with Governments in collusion with a Pharmaceutical Dictorship.
    And all this when they have cheap drugs that treat Covid they supressed . And the attack on the unvaccinated , blaming this group is the unscientific new divide and conquer tactic by fraudulent Entities trying to take over.

    1. nice summary, Housing Wizard.
      (by chance, do you own a long-necked mirror in which to check under your vehicle for . . “unusual” items !?
      perhaps on the x-mas list)

        1. It’s a reference to the mob technique of planting a bomb in the undercarriage of a car. You hold a mirror with a long handle under the car so you can detect the bomb.

  24. A colleague, mother of 2 boys, late 30’s. She took her booster shot 2 weeks ago, also had kids’ first does around the same time. Just yesterday, all 3 are diagnosed with ‘rona.

    As of yesterday, symptoms were mild for all 3. Hoping for the best for them.

    Makes you wonder about the whole vaccine $shit, doesn’t it?

    1. that does make you wonder, QCD.
      btw, am also wondering if said mother of 2 is a single mother?

      asking for a friend. of course

      1. “btw, am also wondering if said mother of 2 is a single mother?”

        Nah. She’s from a turd world country where marriage/family/education is still held in high regard.

        1. If everyone is interested in marriage/family/education, I’m surprised it’s still a third world country.

    2. The vaccine *IS* the virus.

      And this alleged “variant” is just a cover for the third booster shot of this poison destroying peoples’ immune systems.

      Dr. Fraudci needs his neck in a noose.

      1. The only answer to this is for every red blooded American to take matters into their own hands. ALL journalists should meet an untimely end through an unobserved robbery.

        Like Seth Rich did.

    3. I heard that the BIL’s young and healthy boss, who just got boosted, has been very ill for days and has a swollen eye. I guess that’s a sign that it’s “working”

      1. When I was younger, I seem to recall that an extreme reaction to a vaccine might be a light fever that lasted a day.

    5. With great thanks to a few highly educated, passionate, honest and daring people, one of whom lost his life for revealing the razor blades, I no longer have to wonder. I know with certainty. God bless them and their magnificent work,

  25. anyone else’s phone blowing up with spam the last few weeks!?
    mine is off the charts: the worst ever after 20 years of the same #

    pretty obvious that offshore india/china/russian etc spam bots are ramping up again, but more desperate & insidious than ever.

  26. Why is gold and silver tanking day after day? Gold and silver are cheaper today than they were 10 years ago.

    2. Precious metals are a fear trade. No one is buying the Omicron fear porn, so money has gone back into post-pandemic mode.

  27. Are warning signs from the bond market giving you the urge to dump your risk asset HODLings before it’s too late?

    1. The Financial Times
      Sovereign bonds
      Bond market flashes warning sign over global economic growth
      Yield curves are flattening as fears over Omicron variant and inflation muddy the outlook
      US Federal Reserve chair Jay Powell
      Federal Reserve chair Jay Powell has indicated an openness to a faster reduction in the pace of asset purchases by the US central bank
      © Al Drago/Bloomberg
      Tommy Stubbington in London and Kate Duguid in New York
      54 minutes ago

      Bond markets are flashing a warning signal over the outlook for global growth as a combination of inflation fears and the spread of the Omicron coronavirus strain sparks a shift in investor expectations.

      Short-dated bonds have come under renewed pressure globally since Federal Reserve chair Jay Powell on Tuesday indicated an openness to a faster reduction in the pace of asset purchases by the US central bank, potentially clearing the way for earlier rises in interest rates.

      But while short-term debt has been hit by the prospect of tighter monetary policy, longer-dated bonds have rallied as the prospect of a further wave of coronavirus infections exacerbates concerns about the trajectory of the global economy.
      …

  28. This certainly makes sense to me.

    ‘iBuyers can get into trouble if they pay above market for too many houses in a cooling market,’ DelPrete notes. ‘This results in a growing inventory of over-priced houses that are difficult to sell.’

    Try not to get stucco overpaying at a market top.

    1. 7 billion people just need to say no to vaccine passports. There aren’t any populations that voted for this new system of slavery . They can’t implement the new slave system unless people comply.
      And no doubt these Entities that are trying to take over would have a looting system , while the masses only get what they allow or force .
      Faked Pandemics or Climate Change nonsense to justify the new systems of taking all freedoms from people.
      And it would not surprise me if depopulation is something this new Dictorship would do without blinking a eye.
      They never plan for people to return to normal , because normal is the system they are trying to destroy.
      Build Back Better is a Dictorship of mass drone like slavery. Just outrageous .

  30. Of the few things I went to pick up at the grocery store last night there were some odd empty Socialism shelves at the Maplewood Publix in Jupiter Fl.

    Half and Half section: empty

    Gatorade shelves: empty

    Philadelphia Cream Cheese shelves: empty

    Let’s Go Brandon!

    1. Weird, because about 8:30 last night I ran to the store to get some half and half for my coffee. NADA. Most of the dairy section was empty. I’m out on the west coast.

    2. In an odd coincidence, I went out last night to grab some half and half for my morning coffee and encountered much of the same. The shelves were bare of almost all dairy save for that overpriced local milk in glass bottles that hardly anybody can afford. I had to buy some overpriced dairy creamer instead. I’m west coast.

    3. I haven’t seen any shortages lately. Doesn’t surprise me that there are empty shelves in Clownifornia.

    4. The organic brand of 1% milk that my wife likes has been back-ordered for several weeks now. I believe that it’s due to the flooding of the dairy farms NE of the Bellingham, WA area.

  32. Published two hours ago.

    Fox News — White House says domestic travel vaccine requirements on the table due to omicron variant:

    “The White House on Thursday said a COVID-19 vaccine requirement for domestic travel is still on the table as the United States heads into the winter months and battles the new omicron variant, saying the Biden administration will continue to “evaluate and assess on a daily basis.”

    https://www.foxnews.com/politics/white-house-says-domestic-travel-vaccine-requirements-on-the-table-due-to-omicron-variant

    The answer to 1984 is 1776.

    Ben, get the ropes ready…

    1. Fear porn for the sheeple bedwetters:

      “Gov. Jared Polis and state epidemiologist Dr. Rachel Herlihy confirmed the case found in Arapahoe County on Thursday afternoon in a woman who recently traveled to Africa.

      According to the Colorado Department of Public Health and Environment, the woman has mild symptoms and has been isolated at home. She was fully vaccinated but had yet to receive the booster dose of the COVID-19 vaccine.

      Colorado is the third state to confirm a case of the variant.”

      https://www.cpr.org/2021/12/02/colorado-omicron-variant-detected/

      1. Funny how requiring international travelers to be vaxxed and tested was unable to stop Omicron’s spread.

        2. Were international travelers required to be tested? I thought fully vaxxed people didn’t need to be tested. And it didn’t have to be a foreigner — it could have been any American citizen who brought it back. But at this point it doesn’t matter. It’s already here, we’re all going to get it. Perhaps the extreme contagion is a blessing in disguise. Masks and social distancing no longer work. We’ll have a nice big peak no matter what officials do. And then it will be over.

          1. But at this point it doesn’t matter

            It does matter. Almost everyone who travels internationally has to be vaxxed. So far, everyone who has been identified with Omicron was vaxxed. Which means that the vax does not stop the spread.

            Meanwhile our betters keep shrieking at us to get vaxxed. Why?

          2. I was saying that it doesn’t matter whether it was a citizen or non-citizen who brought it back. Whether Omicron is found in vaxxed vs. unvaxxed is a different issue.

          3. “Masks and social distancing no longer work.”
            Excuse me, Ms. Oxide, but they have never worked at all. That is purely propaganda, what Twitter would label as misinformation (in an alternate universe where Twitter is truthful).

        3. requiring international travelers to be vaxxed and tested was unable to stop Omicron’s spread.
          I am traveling overseas next week. Friends are telling me I might not be able to get back in. I doubt it, I think I will be fine coming back in. I think they watch too much news.

    2. Michael Sincere’s Long-Term Trader
      Opinion: In his final warning, this stock trading wizard — who made big money in bear markets and crashes — called this market a bubble like no other
      Last Updated: Dec. 2, 2021 at 5:43 p.m. ET
      First Published: Dec. 2, 2021 at 7:20 a.m. ET
      By Michael Sincere
      MarketWatch Contributor Network
      Veteran trader Mark D. Cook, who passed away recently, closely monitored the market’s health and was convinced that U.S. stocks are due for a major hit
      Mark D. Cook
      LovelyInk Creative

      Mark D. Cook, a veteran options trader who was featured in author Jack Schwager’s best-selling “Stock Market Wizards” book, passed away in late October. I had planned to speak with him to discuss his bearish views on the U.S. stock market, which grew more ominous each week and shared in his twice-daily market advisory service.

      Cook was an old-school S&P 500 (SPX, +1.42%) futures trader. He made his first million dollars in the wake of the October 1987 stock-market crash by loading up on put options before the downturn, thanks to the strength of a signal from the NYSE TICK indicator he closely followed.

      Cook had other big stock-trading successes, including a 563% audited annual return in 1992, followed by a 322% annual return in 1993. Cook is also known for anticipating the 2001 and 2008 U.S. stock market crashes (and made a small fortune betting against the market).

      In recent years, he predicted that the U.S. bull market which began in 2009 would meet a similar fate. He and I even collaborated on a book about bear markets, published in 2015. In our most recent conversation, Cook said he was convinced that this current bull market was on its last legs. He said it had gone on too long and gone up too high.

      “Think of a vacant building that has a gas leak,” Cook once told me. “The gas has been leaking for a long time. The longer the gas leaks, the bigger the explosion. It will take a catalyst to trigger an explosion, but no one knows what is the trigger point. The longer the gas is in there and ignored, and forgotten, the greater the explosion.

      “The stock market,” he said, “is like the vacant building.” When it blows, the result will be horrible. He expected the worst to hit this market.
      …

    1. The Financial Times
      Federal Reserve
      Fed official Randy Quarles’ parting shot: first Covid stimulus, then ‘colonisation of Mars’
      Pandemic response must not pave way for future central bank spending splurges, warns Randy Quarles
      Randy Quarles, who is stepping down as a Fed governor this month, struck a cautious tone about the unprecedented support provided at the onset of the coronavirus crisis
      © REUTERS
      Colby Smith in New York
      7 hours ago

      The emergency lending facilities rolled out by the Federal Reserve at the start of the pandemic threaten to set a dangerous precedent that will put pressure on the central bank to fund all manner of government projects — including even the “colonisation of Mars”, an outgoing top official has warned.

      Randy Quarles, who is stepping down as a Fed governor this month, struck a cautious tone about the unprecedented support provided at the onset of the coronavirus crisis by the US central bank, which implemented a series of programmes to ensure the smooth flow of credit to households, business and local government.

      Quarles said that the facilities put in place for the pandemic had “established the precedent that the Fed can lend to businesses and municipalities”, which would encourage those with grand plans and little patience for democracy to demand more action in the future.

      “There will inevitably be those . . . who will begin to ask why the Fed can’t fund repairs of the country’s ageing infrastructure, or finance the building of a border wall, or purchase trillions of dollars of green energy bonds, or underwrite the colonisation of Mars,” said Quarles, a Donald Trump appointee who had served as one of Wall Street’s top watchdogs before his term expired in October.

      In addition to slashing interest rates to zero and unveiling a massive bond-buying programme, the Fed rolled out 13 facilities under powers that allowed it to make asset purchases in “unusual and exigent circumstances” with the backing of US Treasury to cover any losses.

      Overall usage of the programmes was low, with the Fed’s mere promise of action serving to calm investors.

      But Quarles said the central bank’s willingness to wade into risky markets like corporate junk bonds and municipal debt “[breached] the long unbreachable firewall of offering direct lending to non-financial businesses”. If abused, it could bring “great” damage to the institution’s mission, he added at an event hosted by the American Enterprise Institute, a right-leaning think-tank.

      Quarles reiterated his support for the Fed’s response to coronavirus, but warned that an institution unshackled from “congressional appropriations” would have the “vastest political consequence and political control of it would be a great prize”.
      …

      1. Quarles lost all credibility when he was caught trading on “insider” information; i.e. information that he as a Fed Governor created himself. Hard pass. And there is no need to colonize Mars. Just colonize the Golden Valley in Arizona. Nobody would know the difference.

  37. Tucker Carlson tonight on the ABC News Jussie Smollett Robin Roberts interview.

    Who would have believed downtown Chicago was MAGA Country?

    ABC News would, to ABC News it is always 1958 in Mississippi.

  38. Alec Baldwin says he did not pull trigger in ‘Rust’ shooting

    By Sonia Rao
    Today at 11:54 a.m. EST

    “I would never point a gun at anyone and pull a trigger at them. Never,” Baldwin told ABC News’s George Stephanopoulos in snippets teased from an hour-long interview that will air on ABC Thursday at 8 p.m.
    ——————————————————————————————————–

    Oh, well if all you did was pull the hammer back I guess it’s ok then Alec.

    https://youtu.be/44Sy3-KKrqc?t=22

    1. Although the revolvers I have fired, the latest being a S&W .38 Snubnose Revolver, even with the hammer cocked you still had to pull the trigger to get the gun to fire. Now with the hammer cocked you didn’t have to do much more than breathe on the trigger for it to fire.

      Merriam-Webster

      hair trigger noun
      Definition of hair trigger (Entry 2 of 2)
      : a gun trigger so adjusted as to permit the firearm to be fired by a very slight pressure

      1. There’s a reason for that. If you had to make a significant squeeze to fire, the accuracy would be wildly off with a handgun.

          1. Aim, zero, slow exhale, finger strong>tip, drop hammer. Improved technique can make a sharpshooter out of anyone with the right rig.

            Remy12g pump is still my go to. Crude, loud, powerful, fast, affordable.

  41. Does it seem the markets are even crazier now than during the late-1990s buildup to the dot com bust, Enron implosion, etc.?

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