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A Typical Pattern Of Panic, Fear, And A Mad Scramble By Central Bankers

A weekend topic starting with the Marietta Daily Journal in Georgia. “‘Home values are staying really healthy, but it’s not the frenzy that it used to be,’ said Ellen Hill, a real estate agent with Atlanta Fine Homes. ‘When the interest rate hiked, obviously it caused buyers to pause and to rethink things. Because it was one thing in their mind to overpay for a house — and pay significantly more than anybody ever has in that neighborhood — but money was so cheap a few months ago, that you could still justify it.'”

Columbia Basin Herald in Washington. “Nick VinZant, an analyst with a Seattle-based online market research company, has a theory as to the reason for the shift. ‘I think what is happening is two things that are related to one thing,’ he said. ‘And that is that interest rates are starting to rise. That ultimately means that money isn’t cheap anymore. We’ve seen in some places a 6% drop in two months. And I think that that is going to continue as long as there are signals that the interest rate is going to stay where it is, it’s not going to get higher.'”

From WHSV. “Unlike other housing markets in Virginia home values in the valley are continuing to increase. ‘There’s a lot of worry in the more urban markets like Northern Virginia, Richmond, and the Tidewater area of prices decreasing. They’re seeing pretty rapid and significant decreases in those areas,’ said Matt Ogden, a realtor at Kline May Realty in Harrisonburg.”

From New Jersey.com. “The effects of rising interest rates is less evident in South Jersey, said Mike DePalma of DePalma Realty in Millville. When the interest rate goes up one percentage point it takes away about 10% of a purchaser’s buying power, DePalma said. ‘When you have triple that happen, you have a problem.'”

The Review Journal. “Houses aren’t selling as fast as they used to. Among the single-family homes that traded hands last month, 56.8 percent had been on the market for 30 days or less, down from 71.7 percent of the sales in August and 83.8 percent in September 2021. The numbers point to a relatively steady month for Las Vegas’ resale market, but it still shows a dramatic change from last year’s cheap-money-fueled buying binge. This year, a sharp jump in mortgage rates put the brakes on home sales in Southern Nevada and around the country.”

Flagstaff Business News in Arizona. “What a difference a year makes. As the leaves begin to turn, our real estate market is seeing some signs of cooling temperatures as well. As of September 2022, the average single-family home price in Flagstaff is $734,092 and was $729,044 September 2021. However, at the height of the market, an average single-family home cost $984,502 in February 2022. Back then, it was conceivable we would see the average home reach a million dollars. But now, just eight months later, the outlook is a bit different. Price increases in housing had been astronomical and unsustainable and are now more moderate.”

The LA Daily News. “‘This is NOT 2008,’ say many high-profile real estate gurus of the current homebuying slowdown. Well, if 2022 isn’t 2008, then what is it? Virtually anybody who tracks housing agrees that 2022 marks the end of this real estate cycle’s history-making appreciation. Think about what the FHFA indexes are telling us this year. California home prices rose at a 21% annual pace in 2022’s first half. It was California’s eighth-highest gain in history and a rate of appreciation triple the 7% increases averaged since 1975.”

“But this eye-catching jump was only the 16th biggest among the states. To start 2022, 19 states set new record highs for one-year home-price gains. Yes, larger jumps than increases of the bubble that burst in the mid-2000s. Also, the 19.3% average increase among the states was the all-time high — and quadruple the 4.8% annual average since 1975. The grand debate, however, is what future is created by the market’s ongoing normalization/recalibration/correction — or whatever you want to call the brewing cooldown.”

From Market Watch. “People are going to start to accept the fact that higher mortgage rates are the new normal, Christine Cooper, chief U.S. economist at CoStar Group, told MarketWatch. ‘In six months or a year, we’re gonna think, okay, we’re going to be able to mange it,’ Cooper said. ‘We’re just going through a period of transition where we were expecting it to be this way, and all of a sudden, that’s not the world we’re in any more,’ she added. ‘People will adapt.'”

From Bloomberg. “The prospect of declines in home prices as mortgage rates soar is hitting homebuilding stocks hard. Whether the low valuations present opportunities for investors, however, depends on what happens to the housing market. With many of the stocks trading below book value, the firms ‘appear to be discounting a scenario where home prices fall 20-25%, because this is the amount of price reduction that would cause the builders to take large impairments to their land holdings and drive down book value,’ Evercore ISI analyst Stephen Kim said. He doesn’t expect such a downturn because of a dearth of housing inventory in the US.”

The San Antonio Business Journal in Texas. “In the wake of mounting interest rate increases imposed by the Federal Reserve, San Antonio’s housing market — once scorching hot — has been showing signs of slowing since the second quarter of 2022. Now homebuilders growing nervous about inventory collecting dust on the shelf rather than flying off it are beginning to ramp up measures to incentivize home buying. ‘Most homebuilders I’ve spoken to have said they want to close out their inventory by year-end,’ said Sean Chandler, president of Chesmar Homes’ Central Texas division.”

“The cost of housing has been on the rise in San Antonio since the pandemic, up an average 39% across the city to a median $385,340. ‘A year ago, we were selling homes as fast as we could build them, and prices were going up all the time,’ said Chandler. ’90 days ago, that came to a screeching halt. Every builder is going to have to find the right price a home will sell at. We’re going to discount the heck out of them.'”

The New York Times. “In response, in the summer of 2021, central banks began raising interest rates. Brazil led the way. In early 2022, the Federal Reserve joined in, unleashing a bandwagon effect: Once the Fed moves and the dollar strengthens, other countries either raise their interest rates or face a sharp devaluation, which further stokes inflation. The outline of this pattern is familiar. But the breadth is new. We now find ourselves in the midst of the most comprehensive tightening of monetary policy the world has seen. While the interest rate increases are not as steep as those pushed through by Paul Volcker as Fed chair after 1979, today’s involve far more central banks.”

“There are moments when history-making creeps up on you. This is one of those moments. As far as the advanced economies have been concerned, the era of globalization since the 1990s has been one of disinflation and monetary expansion by central banks. Now that balance is being reversed, and on a global scale. To respond to this imported inflation, other central banks have little option but to raise interest rates even more, which continues a vicious circle. The end result of this bidding war is unpredictable as far as the exchange rate is concerned, but one thing it will do is drive interest rates to levels higher than anyone would have picked in isolation.”

From David Rosenberg. “The assumption is that these people on the Federal Open Market Committee are smart – so they must realize how ludicrous it is to be chasing lagging indicators. Or maybe there is another agenda – come on, there has to be – in that these folks want to take the punch bowl away. But how egregious, after luring people into cheap leverage to buy homes and equities at ever-crazy price levels through all of 2021, that now the Fed is consumed with asset inflation (which is what I think the real story is here) – this is the classic Lucy and Charlie Brown skit with the football.”

“Jerome Powell is Lucy and everyone else is Charlie Brown. It’s incredible. And the apologists out there on how ‘Jay is doing a great job!’ boggle the mind. In the meantime, real-time data show that rents and home prices are now deflating. Not merely slowing, but deflating. Jay, why were you adding mortgages to the balance sheet in the face of a massive housing bubble? Why did you keep easing monetary policy into massive fiscal largesse and the reopening of the economy? You see, these are the things that the media never dare ask him at those post-meeting press scrums.”

“This is the weakest set of FOMC members I can recall in my near-40 years in the business. Mr. Powell has the temerity to compare himself to Paul Volcker, the Fed chair who was widely credited for having ended the high levels of inflation seen in the 1970s and early 1980s.”

“But Mr. Volcker inherited the inflation situation he had to deal with. Mr. Powell and his crew are just cleaning up their own mess. And now they are in the process of overtightening just as they over-eased. Both in relation to the economy and the market, the Fed has created the conditions for a boom-bust in both. The movie from March, 2020, to December, 2021, when TINA and FOMO predominated and Jay Powell played the role of bartender, is now winding down as he takes the punch bowl away.”

From CBC News. “If you listen to the right group of top economists representing business, labour and global finance, you might decide that central banks are crazy to keep on raising interest rates. But on Thursday, in the face of that chorus of criticism, Bank of Canada governor Tiff Macklem insisted that despite a ‘narrow path’ to the kind of soft landing that would avoid recession, interest rates must go higher still. This week there were new signs from Vancouver and Toronto that the Canadian housing market was on a downward path, and I ran across an ominous IMF quote in one of my columns from 10 years ago: ‘When house prices rise because households gorge themselves with debt … the ensuing recession is much deeper and more protracted than busts not preceded by such debt accumulation.'”

The Globe and Mail. “There are so many fissures emerging in the global financial system that it is difficult to predict which issue will be viewed by economic historians as the tipping point for the next crisis. Perhaps it will be the mortgage market. Mortgage rates in Canada, the United States and Europe have effectively doubled – or will soon. Buyers in the past few years are especially likely to run into trouble as they bought at prices inflated by artificially low rates. As mortgages are renewed at higher rates, household cash flows will be impaired and net worth will decline.”

“The deterioration of China financially seems to be coming to a head. Decades of debt accumulation in the Middle Kingdom and almost unfathomably bad investments are certainly cause for concern. The question is how vulnerable the rest of the global financial system is to China.”

“More broadly, a sovereign debt crisis in developing countries is a real possibility depending on how exposed the global banking system is to the economic crisis we are witnessing in places such as Sri Lanka. Governments whose populations are facing mass starvation will prioritize saving lives over timely payments to foreign bankers.”

“There are many situations that can trigger a financial crisis – when asset prices steeply decline in value, business and consumers have trouble paying debts, and liquidity shortages hit financial institutions. But once begun, they follow a typical pattern of panic, fear, and a mad scramble by central bankers and policy makers. Some institutions will be affected more dramatically than others, usually resulting in some form of debt write-off and some creditors taking large losses.”

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This Post Has 124 Comments

  1. ‘We’ve seen in some places a 6% drop in two months’

    This is an abnormal pace of crater, even after a bubble.

    ‘As of September 2022, the average single-family home price in Flagstaff is $734,092 and was $729,044 September 2021. However, at the height of the market, an average single-family home cost $984,502 in February 2022. Back then, it was conceivable we would see the average home reach a million dollars. But now, just eight months later, the outlook is a bit different’

    Jerry and the girls couldn’t see this? 700k is an insane bubble for Flagstaff, how does one describe 980k?

    1. Re-post from the last thread.

      Washington Post — A majority of GOP nominees — 299 in all — deny the 2020 election results (10/6/2022):

      https://archive.ph/nNhkQ

      The Post thinks this article is a smear, but it’s actually a Who’s Who of candidates you need to vote for.

      Joe Biden has zero legitimate authority to govern anything. Merrick Garland has zero legitimate authority to prosecute anything. The FBI, which is essentially an extension of the Southern Poverty Law Center, is a domestic terrorist organization.

      P.S. FJB

      1. The FBI, which is essentially an extension of the Southern Poverty Law Center, is a domestic terrorist organization.

        The FBI & SPLC answer to the same puppetmasters.

    2. Stolen from who? The 2020 election, like all presidential elections, was a farce. It wasn’t for we the people, it was for them the oligarchy. Every election is stolen from that perspective.

  3. ‘This is NOT 2008,’ say many high-profile real estate gurus of the current homebuying slowdown. Well, if 2022 isn’t 2008, then what is it?’

    This is one of my favorite lines of denial. It’s 2022, just look at the calendar.

    ‘As far as the advanced economies have been concerned, the era of globalization since the 1990s has been one of disinflation and monetary expansion by central banks. Now that balance is being reversed, and on a global scale. To respond to this imported inflation, other central banks have little option but to raise interest rates even more, which continues a vicious circle. The end result of this bidding war is unpredictable as far as the exchange rate is concerned, but one thing it will do is drive interest rates to levels higher than anyone would have picked in isolation’

    You mean it could get worser? And the magic people didn’t see it coming?

    I’ve mentioned before in the 90’s I got an email from a US contractor I knew in Thailand. It said, ‘there’s something crazy going on in the currency market here.’ A couple of weeks later the ‘Asian Crisis’ was huge news all over the world. But keep yer eyes on the rear-view mirror, scouting fer ghosts of subprime past, while you are set to hand the keys back to somebody like me.

  4. ‘California home prices rose at a 21% annual pace in 2022’s first half. It was California’s eighth-highest gain in history and a rate of appreciation triple the 7% increases averaged since 1975’

    ‘But this eye-catching jump was only the 16th biggest among the states. To start 2022, 19 states set new record highs for one-year home-price gains. Yes, larger jumps than increases of the bubble that burst in the mid-2000s. Also, the 19.3% average increase among the states was the all-time high — and quadruple the 4.8% annual average since 1975’

    Lanser does a good job with the historical stuff. I could say it a lot of ways. But ultimately this is the result of REIC changing the definition of the last crash cause to ‘subprime did it, high prices didn’t’. Prepare fer yer crowz REIC.

    1. Elon has been slowly redpilling for a while. Not sure when it started for him, but he did get a jolt (pun intended) when California shut down his Tesla plant at the start of COVID. Isn’t that part of why he packed up and moved to Texas. His Twitter deal has been on-again-off-again for a while, but I hope he ultimately signs the papers.

      1. but I hope he ultimately signs the papers

        He signed the Merger Agreement on April 25, 2022. He’s been trying to weasel out of it. Chancellor McCormick in the Delaware Court of Chancery stayed the litigation on Thursday and gave him until October 28, 2022 to close the deal. If he doesn’t, he’ll be forced to by the court.

        From the go-to Twitter account on the matter, https://twitter.com/chancery_daily/status/1578144243423379457?cxt=HHwWgoCgmf_02OYrAAAA:
        So, this is Elon’s one chance, on the court’s stage, to show whether he is a good faith actor in trying to close this deal, or whether (as many on here have long ago entered order and final judgment) he is full of ish. We did that off the record. She has to do it ON.

        1. Musk has another case before the same Chancellor regarding his compensation package and yet another case on appeal before the Delaware Supreme Court regarding the SolarCity acquisition.

        2. OK thanks for the info. I’m seeing some conflicting reports on this — probably pundits misinterpreting lawyerese flying back and forth. So that’s why I need to wait.

          1. misinterpreting lawyerese flying back and forth

            There’s a lot of that going on. It doesn’t help that the case was moving at breakneck speed with an overabundance of submissions. @chancery_daily is the best source for information.

  6. ‘With many of the stocks trading below book value, the firms ‘appear to be discounting a scenario where home prices fall 20-25%, because this is the amount of price reduction that would cause the builders to take large impairments to their land holdings and drive down book value…He doesn’t expect such a downturn because of a dearth of housing inventory in the US’

    Steve, meet Sean:

    ‘The cost of housing has been on the rise in San Antonio since the pandemic, up an average 39% across the city to a median $385,340. ‘A year ago, we were selling homes as fast as we could build them, and prices were going up all the time,’ said Chandler. ’90 days ago, that came to a screeching halt. Every builder is going to have to find the right price a home will sell at. We’re going to discount the heck out of them’

    Hey Steve, get out there and snap up those shack builder stocks, it’s gold nuggets just laying on the ground, like those under the El Camino parked in the California front yards.

    via GIPHY

  7. ‘Or maybe there is another agenda – come on, there has to be – in that these folks want to take the punch bowl away. But how egregious, after luring people into cheap leverage to buy homes and equities at ever-crazy price levels through all of 2021’

    It can’t be ruled out. They did say you’ll own nothing.

  9. Ben, I fear the panic and fear the HBB might be propagating with this incessant drumbeat of doom-and-gloom about soaring inventories, plummeting shack prices, headcount reductions at mortgage brokerages and realtors’ offices, and tear-jerker FB tales of woe, will make it more difficult to Always Be Closing. How do you live with yourself, sir, knowing you are monkey-wrenching this REIC industry of dissemblers?

  10. “Nick VinZant, an analyst with a Seattle-based online market research company, has a theory as to the reason for the shift. ‘I think what is happening is two things that are related to one thing,’ he said. ‘And that is that interest rates are starting to rise. That ultimately means that money isn’t cheap anymore.

    I bet Nick looks splendid in his Captain Obvious custom.

  11. A reader sent these in:

    Danielle DiMartino Booth

    “More than 50% of CEOs not by name, are planning layoffs…a separate report said 60% of HR managers are looking to layoff people working remotely.”

    https://twitter.com/DiMartinoBooth/status/1578445843505577984

    BofA just settled the last of their mortgage lawsuits from the 2008 financial crisis 😂

    Just in time for their law firms to prepare for the 2022-2023 Great Reset litigation !!!

    https://twitter.com/WallStreetSilv/status/1578400250087313411

    Ali Wolf

    Coworker that is doing fieldwork this week just called. Said on the ground, there’s a market in the West where home prices are already down 10-15%

    https://twitter.com/AliWolfEcon/status/1578400660407472130

    it could be a lost decade for housing investment.

    https://twitter.com/d_demelis/status/1578459296836112384

    Massive speculation drove record housing prices. Now, high interest rates are combining to make homes unaffordable. In addition, employers are ending work from home policies. All of which pressures rents and CPI. Avg. house price * 30 year mortgage, % change annualized:

    https://twitter.com/SuburbanDrone/status/1578419884945735680

    Used car prices are now down year-over-year, the first time we’ve seen that since May 2020.

    https://twitter.com/charliebilello/status/1578389247282888705

    💥Scoop: London’s most expenisve mansion (£210mn!!) is owned by Evergrande chairman – once China’s richest man, now staving off a crisis at his heavily indebted company.

    https://twitter.com/GeorgeNHammond/status/1578332823299112960

    Record high in the 30YrTBond. Bye bye housing market. Fed has no idea how much pain this will cause. (or maybe they do).

    https://twitter.com/LawrenceLepard/status/1578461227302678529

    1. I would love to see remote lay-offs. The Zoomers think they can get away with constant whining because there are too few of them to replace the retiring Boomers. Wait until the find out that many of those retiring Boomers were just coasting in do-little jobs and won’t need replacing anyway.

      Firing the remotes is cheap and easy too, as that guy at Better [mortgage] proved. No counseling, no carrying boxes of family photos, no escorts; just one TEAMS meeting and then IT types a couple commands, and maybe they’ll send a box for your bricked laptop.

      1. If the job can be done without a company footprint over 2 years, then it can certainly be done going forward. My wife (who is not a zoomer or a millennial or even a GenX) has been working from home accomplishing more than the other 2 members on her team since the world imploded in March of 2020 in a rather technical field. She’s not going back. And go ahead, lay off the one female in your 50 person department who’s over 50. We’ll go ahead and collect all the money from discrimination suits.

        If you sit behind a computer all day, there’s no reason you can’t do your work from home. This has been true for 20 years, and it’s been proven for almost everyone over the last 2 years. The companies that force in person employment are not going to be getting the best.

        There is no reason to spend hours commuting, paying for expensive company space, etc. A mostly virtual workforce is going to have way lower expenses than a class A office space business and now that money is getting expensive……………..

        The whole “lay off remote workers first’ is clearly a deep state push to force people back to the office because the cities tax base is cratering.

        Burn baby burn.

        3. If the job can be done without a company footprint over 2 years, then it can certainly be done going forward.

          That’s up for debate. But I’m in a phone call and don’t have time to elaborate.

        4. there’s no reason you can’t do your work from home.

          I did and I made it work, but there is corporate culture to fit into and in the end such things are up to the BOSS.

        6. You know what is amazing for families?
          WFH.

          People complain about remote work and then complain that parents are never there for their children.

          Idiots. My husband works from home. While most people take their 5 minute office breaks around the water cooler my husband takes his 5 minute break and changes the baby’s diaper so he can interact with her for a few minutes during the work day.

          Do not underestimate how good for families WFH can be- especially if dad is a very hard worker.

      2. “What should the median home price be? Easy.
        Take the median household income multiply by 28% and divide by 12.

        Median household income: $75,000 (est 2022)

        $225,000 is what the median home price should be at 7% rates with 10% down (average)”

        – Alternate calculation (in an apparently alternate economic universe:
        median house price (ignoring “the mix”) = 3 * median household income. I know, how 20th century, old school, or something, but it works:

        $75K * 3 = $225K. Magic! 🙂

        – In any case, it’s all about the payment. 28% of monthly income is about right, ignoring DTI and Bidenflation for the moment.

    1. The only thing better than a Bitchute post from our esteemed blog host is a double Bitchute post.

      Bitchute for the WIN.

  13. Why do the Democrat-Bolsheviks need to operate more “fake news” websites, when the entire globalist media-entertainment complex is propagating their narratives?

    Democrats are operating a series of 51 ‘fake news’ websites pushing left-wing stories in toss-up states in a bid to turn the midterms in their favor, shocking investigation finds

    https://www.dailymail.co.uk/news/article-11293487/Democrats-operating-series-51-fake-news-sites-pushing-left-wing-stories-toss-states.html

    1. “Jeremiah Babe – LOOKING AT A SUPER BUBBLE TODAY – GREATEST CRASH EVER AVOID HOUSING AND DEBT – LIVING IN FANTASYLAND”

      – We are so screwed on so many levels by the central bank/centrally-planned, command-and-control economy. Think Gosplan in the (former) USSR. Socialism/Communism now infecting the USSA and the rest of the OECD countries. Same outcome. Venezuela trajectory, where they voted for Socialism and now they’re stuck with it.

      – Enjoyed the boom? Now enjoy the bust of the Everything Bubble, aka the Central Bank bubble.

      – This guy knows a thing or two about asset bubbles.

      https://www.gmo.com/americas/research-library/entering-the-superbubbles-final-act/
      Viewpoints | August 31, 2022

      Entering the Superbubble’s Final Act
      By Jeremy Grantham

      “The current superbubble features an unprecedentedly dangerous mix of cross-asset overvaluation (with bonds, housing, and stocks all critically overpriced and now rapidly losing momentum), commodity shock, and Fed hawkishness. Each cycle is different and unique – but every historical parallel suggests that the worst is yet to come.”

      1. “These superbubbles are events unlike any others: while there are only a few in history for investors to study, they have clear features in common. One of those features is the bear market rally after the initial derating stage of the decline but before the economy has clearly begun to deteriorate, as it always has when superbubbles burst.”

        A bear market rally is the often “phat cats” exiting the market by cajoling the public pension funds to purchase their positions at or near par. There’s usually a stooge or two nearing retirement on their investment boards who make it happen.

  17. Selling Your House in the Greater Phoenix Area
    Nicole Lorig AZ Realtor
    Premiered 14 hours ago Home Sellers- here are 2 things you need to be cognizant about when looking at offers.
    The market is tough for buyers with higher interest rates compared to 7-8 months ago.
    Sellers, it’s not the same market for your either. The offers sellers are getting are NOTHING like they’ve heard about over the last 2 years. These offers are VERY different. So let me tell you about 2 things you need to truly be prepared for & cautious when you start getting offers.

    https://www.youtube.com/watch?v=wZY5VKpV00w

    1:32.

  20. Is it safe to assume that the recent spike in mortgage rates will have a very limited effect on US housing prices? The MSM-favored experts are saying that prices will drop by less than 10% through 2023, for instance.

    1. The Financial Times
      Mortgages
      Soaring mortgage rates to pile pressure on property markets worldwide
      Housing markets face seismic change as low interest rate environment ends
      There is little incentive to sell in a down-market. But higher costs for remortgaging could put pressure on some homeowners to trade at a discount.
      George Hammond and Steven Bernard yesterday

      A decade-long party for homeowners is coming to an end. The cost of servicing mortgages in the UK, Europe and the US has spiralled at the same time as disposable incomes have been squeezed, and predictions of a downturn or even a house price crash are now common.

      Last week, Knight Frank forecast that house prices in London would fall 10 per cent over the next two years — a highly unusual move for an estate agency, which adds to independent analysis and bank predictions of falls at least that across the UK.

      How could housing markets, which have felt nothing but price growth for a decade, tip into crash territory?

      The financial crisis in 2008 offered a chastening lesson in the dangers of borrowing excessively against housing.

      Back then about one in seven mortgages were highly leveraged with loan to value ratios equal to, or greater than, 90 per cent. In the years since, banks have tightened their lending criteria with only 4 per cent having the same borrowing levels.

      Today’s borrowers must raise relatively large deposits and demonstrate they can withstand interest rate rises. Reckless lending has largely been kept in check, reducing the danger of homeowners slipping into negative equity.

      The other key feature of the past decade has been rock-bottom interest rates — allowing buyers to take on large mortgages at low monthly costs.

      In turn, anyone able to build up a deposit could afford a pricier property — betting on repaying it as long as rates remained low and the mortgage term was long enough. Low rates have in effect made larger homes affordable, driving up house prices in return and crowding out those unable to raise cash for a deposit or tap the “bank of mum and dad”.

      But rates have spiked higher this year — with the Federal Reserve raising the base rate from 0.25 per cent to 3.25 per cent and the Bank of England and ECB following suit — and markets are expecting they will continue to rise sharply into next year as central banks try to contain runaway inflation.

      Suddenly, that affordability picture has changed dramatically.

      “Only 2-3 months ago we were saying interest rates [in the UK] of up to 3 per cent would be a challenge, given affordability. Markets are now anticipating mortgage rates going up to around 6 per cent,” said Noble Francis, economics director of the Construction Products Association.

      Rising interest rates have had an immediate impact. Mortgage lenders in the UK rushed to pull products after chancellor Kwasi Kwarteng’s tax-cutting “mini” Budget last month drove up expectations of a rate rise.

      Anyone buying a house today in the UK will face far higher mortgage borrowing costs as a result. Mortgage payments, as proportion of income for first time buyers, are roughly 17 per cent on average, according to data from consultancy BuiltPlace.

      However, it’s not just those at the start of property ownership. There is also an effect that will be felt more gradually. Each month, tens or hundreds of thousands of homeowners in the UK roll off fixed-term deals and have to remortgage. When they do they will face costs that are far higher than what they currently pay — and some may be pushed to sell.

      “In a period of time where the majority of people are likely to endure real wage falls, it’s a perfect storm for homeowners who have purchased in the last 10 years and are not used to high mortgage rates,” said Francis.
      …

      1. “Markets are now anticipating mortgage rates going up to around 6 per cent,”

        There are lots of interesting parallels and differences between what is happening now in US and UK housing finance, not to mention in other parts of the planet where housing is financed. But one thing is completely clear: With a globalized financial system overseen by an interconnected network of central banks, the contagion is rampant, uncontained, and uncontrollable.

        Better buckle up!

        1. Yahoo
          MoneyWise
          Mortgage rates step back from the brink, but hesitation is still at a 25-year high
          Nancy Sarnoff
          Sat, October 8, 2022 at 4:00 AM·4 min read
          In this article:
          Mortgage rates step back from the brink, but hesitation is still at a 25-year high

          The interest rate on the most popular home loan in America has fallen for the first time in seven weeks, ending a streak that pushed borrowing costs to their highest point since 2007.

          Yet even with the decline, the average 30-year fixed mortgage rate is still more than double what it was last year.

          Unfortunately for borrowers, this week’s dip was just a small step back after a headlong sprint forward.

          Consumers taking out loans today are spending hundreds of dollars more on their monthly mortgage payments than they would have if they bought just last month, when the 30-year rate was more than a full percentage point lower.

          30-year fixed-rate mortgages

          The rate on a 30-year fixed mortgage averaged 6.66% this week, down from 6.70% one week ago, mortgage finance giant Freddie Mac reported on Thursday. Last year at this time, the typical rate was 2.99%.

          The mortgage rate followed the yield on the 10-year Treasury, which slid this week amid uncertainty about the U.S. economy. The Federal Reserve is still working feverishly to quell inflation by hiking its trend-setting interest rate.

          “While rate increases are needed to tame inflation and alleviate the burden it places on household budgets, higher borrowing costs have caused consumers to think twice about major purchases like homes and cars,” says Danielle Hale, chief economist of Realtor.com.

          The monthly payment for a borrower financing a $400,000 home purchase with 20% down is now over $200 more than where it was last month.
          15-year fixed-rate mortgages

          The interest rate on a 15-year fixed mortgage averaged 5.90% this week, also down from last week when it averaged 5.96%, Freddie Mac says. A year ago at this time, the 15-year rate was averaging 2.23%.

          Generally higher rates are affecting sales, prices and inventory. Shoppers have an increasing number of options available, as the number of homes now languishing on the market outweighs the decrease in new sellers entering the fray compared to last year, housing research shows.

          With competition for homes easing, buyers are gaining leverage.

          After years of sellers being able to call all the shots in sales negotiations, buyers will have the upper hand next year, according to a majority of housing experts recently surveyed by Zillow.
          …
          https://finance.yahoo.com/news/mortgage-rates-step-back-brink-110000875.html

        2. “But one thing is completely clear: With a globalized financial system overseen by an interconnected network of central banks, the contagion is rampant, uncontained, and uncontrollable.”

          And banks like Goldman Sachs are willing to help the world’s kleptocrats loot their country’s resources, for a commission.

      2. “Housing markets face seismic change as low interest rate environment ends”

        I like the earthquake metaphor. Of course, earthquakes are also associated with tsunamis, like the flood of Quantitative Easing into the global financial system over the past decade. Now that the tsunami tide is receding, we can have a look at all the naked swimmers left behind on the beach.

      3. “Back then about one in seven mortgages were highly leveraged with loan to value ratios equal to, or greater than, 90 per cent. In the years since, banks have tightened their lending criteria with only 4 per cent having the same borrowing levels.

        Today’s borrowers must raise relatively large deposits and demonstrate they can withstand interest rate rises. Reckless lending has largely been kept in check, reducing the danger of homeowners slipping into negative equity.”

        “subprime is contained”

        Must be nice to live on whatever planet this is, where the average family brings in $333K to reasonably afford that average $1M starter home.

    2. Markets
      DOW -2.11%
      S&P 500 -2.80%
      NASDAQ -3.80%

      Fear & Greed Index
      Mortgage rates take a breather after rising for several weeks in a row
      By Anna Bahney, CNN Business
      Updated 11:17 AM EDT, Thu October 6, 2022

      After rising for six weeks in a row, mortgage rates retreated last week.

      The 30-year fixed-rate mortgage averaged 6.66% in the week ending October 5, down from 6.70% the week before, according to Freddie Mac.

      Mortgage rates have more than doubled since the start of this year as the Federal Reserve continues its unprecedented campaign of hiking interest rates in order to tame soaring inflation. But uncertainty about the possibility of a recession and the impact of rate hikes on the economy have made mortgage rates more volatile.

      “Mortgage rates decreased slightly this week due to ongoing economic uncertainty,” said Sam Khater, Freddie Mac’s chief economist. “However, rates remain quite high compared to just one year ago, meaning housing continues to be more expensive for potential homebuyers.”
      …
      https://www.cnn.com/2022/10/06/homes/mortgage-rates-week-of-october-6/index.html

    1. “Heather Lee O’Keefe, 25, of Bozeman, [claimed] that Miss USA 2022 was rigged for Miss Texas R’Bonney Gabriel, 28, of Houston, to win…
      …O’Keefe told DailyMail.com that the organizers had an ‘inherent bias’ toward Gabriel, since it is largely based in Houston…”

      R’Bonnie?

  25. Is it just my fertile imagination, or did we just witness the first signs of divergence between price trends in long-term Treasury bonds and stocks?

    Reference year: 1987, especially October…

    1. Yahoo Finance
      Stock market news live updates: Stocks tank, Treasury yields spike as jobs report dashes hopes of Fed pivot
      Alexandra Semenova
      Fri, October 7, 2022 at 1:04 PM·4 min read
      In this article:

      U.S. stocks cratered on Friday in their worst day since the throes of September’s sell-off after the government’s monthly employment report showed labor conditions remained tight last month despite a slowdown in hiring — dashing any hopes the Federal Reserve will pivot on its aggressive rate hiking path.

      The U.S. economy added 263,000 jobs last month as the unemployment rate fell to 3.5%. Economists expected a payroll gain of 255,000 and for unemployment to hold at 3.7%, per consensus estimates compiled by Bloomberg.

      The S&P 500 plunged 2.8%, while the Dow Jones Industrial Average shed 630 points, or 2.1%. The Nasdaq Composite led the way down at a decline oof 3.8%. Meanwhile in the bond market, Treasury yields spiked, with the benchmark 10-year note back near 3.9% and the rate-sensitive 2-year yield topping 4.3%.

      Friday’s sell-off pared much of the week’s gains after a fleeting two-day rally that kicked off the month lifted all three major averages more than 5% off their 2022 lows. Still, U.S. stock managed to end the week on a positive note, snapping a three-week losing streak. The S&P 500 was up 1.5%, the Dow 2%, and the Nasdaq 0.7% since Monday.

      “The market’s negative reaction may be a sign that investors are processing the likelihood that there will be no change in the Fed’s aggressive playbook in the near term,” Mike Loewengart, head of model portfolio construction at Morgan Stanley’s Global Investment Office, said in a note. “Keep in mind the next Fed decision isn’t until early November, so much more data will need to be digested, not the least of which is next week’s inflation gauge.”

      Investors were betting that signs of a cooling labor market would force Federal Reserve policymakers to change course on their aggressive rate-hiking path, particularly after a series of weaker economic releases showed a sharp contraction in manufacturing activity and fewer job openings. But many Wall Street strategists have argued that hopes of an imminent pivot are premature, a sentiment that this jobs report appears to reinforce.

      In recent research notes, JPMorgan analysts said that equity bulls would need a monthly payroll print as low as 100,000 to see the market alter its Fed expectations, while analysts at Bank of America said a pivot won’t occur “until payrolls sting.”

      “The Fed’s job is still far from over: expect hikes to continue until negative payrolls are almost in hand,” a team at BofA led by rates research strategist Meghan Swiber noted.

      Moreover, Federal Reserve officials themselves have delivered clear messaging in recent weeks that there are so far no plans to retreat from aggressive policy intervention.

      “We have further to go,” Chicago Federal Reserve Bank President Charles Evans said Thursday, indicating the benchmark rate will likely be at 4.5% to 4.75% by the spring of 2023. “”Inflation is high right now and we need a more restrictive setting of monetary policy.”
      …
      https://finance.yahoo.com/news/stock-market-news-live-updates-october-7-2022-103610527.html

    2. Bond yields are still spiking when stocks sell off, but it seems like a 4% ceiling is in place above long-term Treasury yields. Is there a comparable floor under stock prices?

      I can tell you from watching Japanese stocks in the 1990s that stocks can drop a long way for years in a low rates environment, following the collapse of a financial market bubble.

  26. Fed Rate Hikes Are Crashing Palo Alto Housing Market – October 2022
    The Talis Team
    Oct 8, 2022 At their September meeting Feds once more increased the rate by 75 basis points. And on top of that they said that they are planning to bump the rate up by another 1.25% by the end of the year. Stock market responding with a sell-off and at the end of September stock market reached its lowest point since the beginning of the year. Mortgage interest rates ballooned close to 7% range in the aftermath of the Fed’s rate increase.

    Even gas prices jumped up by almost a dollar at the local gas stations. Palo Alto Gas on the corner of San Antonio and East Charleston is still the best price in town. Be prepared, however, to wait in line to fill up your tank.

    The housing market continued to slow down in September. Number of new listings fell by 30%, number of closed sales decreased by 16% and number of new contracts dropped by 46%, all compared with September of last year. September median home sale price in Palo Alto decreased to $2,944,000, an 18% decline year-over-year. Year-to-date median sale price is still above the last year level at $3,350,000, a modest 1.5% increase.

    Current market situation favors first time home buyers. Let me explain. Most existing homeowners have mortgages at lowest possible rates. They had a chance to refinance during the last few years when interest rates were at historically low levels. Moving to a different home will force them to get a new loan at a significantly higher interest rate than their existing loan. If they have to sell their current home in order to buy a new one, on top of that they may be facing significant capital gains consequences. These two discouraging factors will reduce the number of potential buyers opening new opportunities for others.

    The same two factors will reduce the number of homes on the market because they will deter discretionary home sales. That will reduce the housing supply and will provide support for home values for the owners who will decide to sell in the current market conditions.

    https://www.youtube.com/watch?v=DuEhLOJ-Ylk

    3 minutes.

    ‘September median home sale price in Palo Alto decreased to $2,944,000, an 18% decline year-over-year’

    I’m seeing this regularly now. It’s not down 18% from the cray cray in March, it’s YOY. How much is it down from the cray cray?

    ‘They had a chance to refinance during the last few years’

    He he…

    2. “How much is it down from the cray cray?”

      We’ll know soon, once we’re a year out.

      Meanwhile you can expect those year over year numbers to get worser and worser.

  28. ‘When the interest rate hiked, obviously it caused buyers to pause and to rethink things. Because it was one thing in their mind to overpay for a house — and pay significantly more than anybody ever has in that neighborhood — but money was so cheap a few months ago, that you could still justify it.’”

    Woman…. anything is justified with borrowed money…… For this reason, you’ve got an empty bank account….. and an empty skull.

    North Dallas, TX Housing Prices Crater 24% YOY As Builders Slash Backed Up Inventory As Demand Evaporates

    https://www.movoto.com/tx/75231/market-trends/north

    As one north Dallas broker explained, “We sold the least number of houses in the last 30 days than any other time in the last 27 years.”

  30. “There are many situations that can trigger a financial crisis – when asset prices steeply decline in value, business and consumers have trouble paying debts, and liquidity shortages hit financial institutions. But once begun, they follow a typical pattern of panic, fear, and a mad scramble by central bankers and policy makers.”

    Nobody does panic better than central bankers.

    1. deserving of a $2,500 PayPal fine

      I remembered that I had an old PayPal account I haven’t used in years. I just closed it out.

        1. Given that I don’t use it, I would say that an alternative, for me at least, is not necessary.

      1. “Marvel comics has a message for you: Be a hero, get jabbed!”

        Biden has a message for you: Be a hero, get kicked out over vaccine mandate.

        Video: Biden thanks Coast Guard hero being kicked out over vaccine mandate

        OCTOBER 03, 2022 LIZ GEORGE

        On Friday, President Joe Biden personally thanked a U.S. Coast Guard rescue swimmer for saving people’s lives as Hurricane Ian slammed Florida last week. The heroic rescue swimmer is currently facing discharge due to Biden’s military-wide COVID-19 vaccine mandate.

        https://americanmilitarynews.com/2022/10/video-biden-thanks-coast-guard-swimmer-being-kicked-out-over-vaccine-mandate/

    2. ‘She was fine, and then her heart stopped’: Illinois Rep. Sean Casten reveals healthy daughter, 17, died from rare cardiac arrhythmia in her sleep in June – family has been left ‘grasping at the wrong end of a random chance’

      Makes one wonder if privately he and his family are cursing the jab, while publicly they don’t, as it would be a career ending action.

      1. They’re libtards. It would never occur to them to question approved Narratives. Such would be heresy bordering on insurrection.

        1. In that case she died of climate change.

          It’s funny how I can vacation at places that are much hotter than where I live, and they never seem to kill me.

    1. I’m waiting for the military’s “you have to be gay or trans” mandate. It shouldn’t be too far off.

  35. What charges will Democrat-Bolshevik judicial officials bring against this MAGA extremist who clearly provoked this assault by a member of a protected class?

    Man brutally beat, stabbed woman for wearing American flag shirt, charges say

    https://alphanews.org/man-brutally-beat-stabbed-woman-for-wearing-american-flag-shirt-charges-say/

    The suspect, 23-year-old Paul Peter Jal, was “upset” because the victim was “wearing an American flag shirt,” a criminal complaint says.

  36. – These excerpts are worth repeating.

    From David Rosenberg. “The assumption is that these people on the Federal Open Market Committee are smart – so they must realize how ludicrous it is to be chasing lagging indicators. Or maybe there is another agenda – come on, there has to be – in that these folks want to take the punch bowl away. But how egregious, after luring people into cheap leverage to buy homes and equities at ever-crazy price levels through all of 2021, that now the Fed is consumed with asset inflation (which is what I think the real story is here) – this is the classic Lucy and Charlie Brown skit with the football.”

    “Jerome Powell is Lucy and everyone else is Charlie Brown. It’s incredible. And the apologists out there on how ‘Jay is doing a great job!’ boggle the mind. In the meantime, real-time data show that rents and home prices are now deflating. Not merely slowing, but deflating. Jay, why were you adding mortgages to the balance sheet in the face of a massive housing bubble? Why did you keep easing monetary policy into massive fiscal largesse and the reopening of the economy? You see, these are the things that the media never dare ask him at those post-meeting press scrums.”

    “Mr. Powell and his crew are just cleaning up their own mess. And now they are in the process of overtightening just as they over-eased. Both in relation to the economy and the market, the Fed has created the conditions for a boom-bust in both.“

    – The Fed is the cause of the problem. It’s almost as if it’s part of a bigger plan to destroy the bourgeoisie (middle class) and transform the nation into a Socialist State, but that would be a tin foil hat conspiracy theory.

    “The surest way to destroy a nation is to debauch its currency.” – Vladimir Ilyich Lenin

    “The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.” – Vladimir Ilyich Lenin

    – The playbook. Then throw in Saul Alinsky’s “12 Rules for Radicals,” and “How To Create A Social State” for good measure.

    The Ten Planks of the 
    Communist Manifesto
    1848 by Karl Heinrich Marx
    1. Abolition of private property in land and application of all rents of land to public purpose.
    2. A heavy progressive or graduated income tax.
    3. Abolition of all rights of inheritance.
    4. Confiscation of the property of all emigrants and rebels.
     5. Centralization of credit in the hands of the state, by means of a national bank with state capital and an exclusive monopoly.
    – There are 5 more.

    How to Create a Social State by Saul Alinsky

    1) Healthcare– Control healthcare and you control the people
    2) Poverty – Increase the Poverty level as high as possible, poor people are easier to control and will not fight back if you are providing everything for them to live.
    3) Debt – Increase the debt to an unsustainable level. That way you are able to increase taxes, and this will produce more poverty.
    4) Gun Control– Remove the ability to defend themselves from the Government. That way you are able to create a police state.
    5) Welfare – Take control of every aspect of their lives (Food, Housing, and Income)
    6) Education – Take control of what people read and listen to – take control of what children learn in school.
    7) Religion – Remove the belief in the God from the Government and schools
    8) Class Warfare – Divide the people into the wealthy and the poor. This will cause more discontent and it will be easier to take (Tax) the wealthy with the support of the poor.

  37. I am looking forward to the Climate Change Sea Level Rise flooded low-lying coastal streets news coverage I get to see what seems like every October in Region IV due to this regular and predictable event. This year we have a NE wind which should add some extra splash to the CarboNazis exploitation of this natural and reoccurring event.

    Define King Tide:

    A king tide is a non-scientific term used to describe the predicted highest high-tide and lowest low-tide events of the year. King tides occur during a perigean (when Moon is closest to Earth) spring tide (full and new moon); in other words, a full or new moon must co-occur when the Moon is closest to Earth in its elliptical orbit. Due to their astronomical nature, king tides are regular and predictable events, reoccurring multiple times a year (click here to see the 2018 NC King Tides Calendar).

    https://nckingtides.web.unc.edu/king-tide/

    1. I think Liz Cheney showed that with the Ray Epps video when she was presenting evidence at the Jan. 6 Hearings.

  43. Affirmative Action DA incompetence enables another felon to continue the cultural enrichment.

    REVEALED: Illegal immigrant who killed two in attack on Vegas showgirls escaped violent crime charge last year after DA failed to prosecute in time – would have faced up to four years in jail if convicted of domestic violence charge

    https://www.dailymail.co.uk/news/article-11294811/Los-Angeles-DA-failed-convict-man-killed-two-injured-six-Las-Vegas-stabbing.html

    1. Lots more like him are flooding across our open border every day, and Democrat-Bolshevik DAs will do their utmost to ensure they have free rein to cavort with impunity.

      EXCLUSIVE: Employer of slain showgirl slams ‘flawed’ criminal justice system after DailyMail.com revealed illegal immigrant was NOT jailed for domestic attack – leaving him free to kill two on Vegas strip in frenzied attack on eight

      https://www.dailymail.co.uk/news/article-11294957/Best-Showgirls-Vegas-owner-starts-fundraiser-slain-employee-injured-staffers.html

  44. The Financial Times
    Asia-Pacific economy
    Confidence slumps around the globe as cost of living crisis bites
    High food and energy prices have fuelled business and consumer pessimism, Brookings-FT tracking index shows
    Eswar Prasad, senior fellow at the Brookings Institution, warned that economic indicators had deteriorated markedly in recent months
    Chris Giles in Tokyo 2 hours ago

    A mood of mounting economic pessimism is taking hold across the world’s major economies, as soaring prices and geopolitical uncertainty damage the prospects of businesses and consumers.

    In the past year consumer and business confidence has fallen by the most in a decade, with the exception of the initial months of the coronavirus pandemic, according to research for the FT.

    Hard economic data and leading financial indicators are also falling from strong levels after Covid-19, signalling that momentum in the world economy is stalling, the latest twice-yearly Brookings-FT tracking index showed.

    The collapse in confidence comes as global financial officials gather in Washington this week for the IMF’s and the World Bank’s annual meetings. The two bodies are expected to publish forecasts warning that the world economy is on the brink of recession.

    Eswar Prasad, senior fellow at the Brookings Institution, said the index’s findings reflected “a series of self-inflicted wounds” by businesses and governments. These ranged from supply chain bottlenecks and weak policy responses in the face of high inflation to China’s zero-Covid policy and fiscal recklessness in countries such as the UK, he said.

    Prasad said: “Growth momentum, as well as financial market and confidence indicators, have deteriorated markedly around the world in recent months.”
    …

  45. Gateway Pundit — National Guard “Accidentally” Gives Service Members COVID-19 Vaccine Instead of Influenza Shot (10/8/2022):

    “Bouchard said he was ordered to receive an annual flu vaccine and went to the clinic to get that vaccine. He verified his name, date of birth, and part of his social security number, and told officials at the clinic he was there for the flu vaccine. But he was injected with a dose of a messenger RNA COVID-19 vaccine, officials told him.

    https://www.thegatewaypundit.com/2022/10/national-guard-accidentally-gives-service-members-covid-19-vaccine-instead-influenza-shot/

    These globalists want you dead.

    1. This is one of the reasons I’m not getting any more vaccines. I was asked at the Doctor’s office if I wanted a flu shot. I declined.

      I also wouldn’t put it past big pharma to slip some of the covid vax into other vaccines.

  46. The Associated Press is globalist scum media.

    Associated Press — Man gets prison for threatening Colorado Secretary of State Jena Griswold (10/7/2022):

    “Griswold said violent threats cannot become an accepted norm.

    “People who threaten election officials must be held accountable,” her statement said. “Threats are being used to try to intimidate election officials from doing their jobs in an effort to destabilize democracy.

    Attorney General Merrick Garland also released a statement declaring, “This sentence makes clear that those who illegally threaten election workers should be prepared to face meaningful penalties.”

    Attorney General Merrick Garland is not an American.

    He does not work for the United States he is a Marxist domestic terrorist. And yes, he is not a Christian. Where did your grandparents get your phony last name at Ellis Island? “Garland” is just like every other one of these globalists that Henry Ford was right about a century ago.

    This isn’t your country. The United States will never be a communist country.

    Ben, get the ropes ready…

    1. Cryptocurrency
      Investing
      Banks
      Real Estate
      Finance ·investing
      So you just checked your 401(k). Here’s how experts say you should navigate the nightmare
      BY Will Daniel
      October 8, 2022 at 8:02 AM PDT
      How to protect your 401(k) in trying times.

      Ok, so you just checked your 401(k) and it doesn’t look good. Actually, it looks pretty terrible.

      But don’t worry, you’re not alone.

      With the bond market experiencing one of its worst years in history and the S&P 500 falling over 24% since January, most U.S. investors are feeling the pain.

      And as predictions of an impending recession—or “something worse”—continue to flood in from Wall Street, even the most seasoned investors are battening down the hatches.

      With this in mind, Fortune reached out to a few top wealth managers for some tips on how to best navigate these treacherous markets and preserve the value of your 401(k). Here’s what they had to say.

      ‘Keep calm and invest on’

      The first mistake most people make when they see big losses in their retirement accounts is rushing to sell.

      Everyone has heard the old adage, “buy low, sell high,” but in practice, it can be easier said than done.

      “While financial advisors everywhere preach about ‘buying low and selling high,’ investor emotions will tempt opposite behavior,” Kimberly Nelson, an advisor at the wealth management firm Coastal Bridge Advisors, told Fortune. “The urge to do something to stem the carnage in your retirement account during a market pullback, recession, or full-on bear market can be hard to ignore.”

      Nelson believes that investors should avoid offloading their 401(k) holdings at this point because stocks are already down over 24% this year, and timing market entries and exits can be a challenge.

      “Usually taking action after the market has fallen does very little to protect your nest egg,” Nelson said. “Coming out of the market means that you have to be right about the exit point and right again about your re-entry point—market timing is almost always a fool’s errand and not the right strategy to build long-term wealth.”
      …
      https://fortune.com/2022/10/08/what-to-do-401k-investment-stock-market/

    2. Yahoo
      Bloomberg
      Bond Traders Follow Fed’s Lead With No Let-Up in Inflation Fight
      Michael MacKenzie and Liz Capo McCormick
      Sat, October 8, 2022 at 1:00 PM·4 min read

      (Bloomberg) — Bond traders are learning to follow the oldest rule in the book: don’t fight the Fed.

      While Treasury yields have seen periodic pullbacks on hope the central bank will ease up on its rate hikes, they have been short-lived as central bank officials stick to their hawkish script. On Friday, a fresh round of selling broke out after the monthly jobs report showed that the unemployment rate unexpectedly fell as payrolls continued to expand at a solid pace.

      That labor-market strength is likely to keep the Fed on track to continue with its most aggressive monetary policy tightening in decades, even if Thursday’s consumer price index report shows some slight easing in inflation pressures. Central bank officials have made it clear that they are determined to stay on course until they rein in inflation that still remains well above their 2% target.

      The jobs data was “a slight disappointment relative to hopes that this report would give a piece of evidence in favor of the camp that there’s a slowdown and a pivot underway,” Jeffrey Rosenberg, BlackRock Inc.’s senior portfolio manager said on Bloomberg TV Friday. But “next week we’ll get the most important report, which is the CPI report” given the concern of some that “we are in a wage-price spiral.”

      The bond market’s relentless rout has hit Treasury investors with a loss of around 13% this year and pushed two-year yields to about 4.3%, just shy of the 15-year high hit last month. With the stock market also under pressure, investors recently poured the most into cash since April 2020, according to Bank of America Corp.
      …
      https://finance.yahoo.com/news/bond-traders-fed-lead-no-200000098.html

    3. The Intelligent Investor
      How to Make Peace With Your Stock Market Losses
      For investors, the only thing worse than losing is having to admit that you’re a loser. Here’s how to clean up your portfolio without feeling ashamed.
      Treasury Bonds May Be 2022’s Coolest Investment. Here’s Why.
      Many new investors don’t know much about bond investing or how much they can earn with low risk by investing in U.S. government bonds. WSJ’s Dion Rabouin seeks to change that with a rad new commercial appealing to America’s youth. Illustration: David Fang
      By Jason Zweig
      Oct. 7, 2022 10:45 am ET

      Have you read your account statements for the just-finished third quarter?

      If you’re anything like me, your answer is no. You probably already know stocks are down 20% and bonds 14% for the year to date.
      …
      https://www.wsj.com/articles/selling-stock-in-down-market-11665153733

    4. Oct 5, 2022 at 10:00 am ET
      Retail Investors Flip from Buying Dips to Chasing Rallies
      By Eric Wallerstein
      Share

      As stocks soared to their best two-day gains since May 2020, retail investors piled in.

      Individual investors bought over $1.8 billion worth of U.S. equities across Monday and Tuesday combined, according to VandaTrack, as the S&P 500 index rallied 5.7%.

      Those figures aren’t above the recent average of $1.1 billion per day, but they’re a marked reversal from the typical contrarian behavior of upping purchases during selloffs and pulling back as the market rises, VandaTrack analysts said in a Wednesday note.

      After the “buy-the-dip” strategy sputtered this year, individuals individuals may now favor chasing price momentum. Strategies which follow market trends like price momentum are among the best performers this year.

      If stocks’ rebound is sustainable, and sentiment–which recently hit a record low amid the worst month since March 2020–improves, that buying pressure could continue heading into earnings season and midterm elections.
      …
      https://www.wsj.com/livecoverage/stock-market-news-today-2022-10-05/card/retail-investors-flip-from-buying-dips-to-chasing-rallies-DqEz8OBiF7RzSiaIbfCd

    5. The stock market is headed for a new 2022 low in October after strong jobs report strengthens the Fed’s case for more hawkish rate hikes, BofA says
      Matthew Fox
      11 hours ago
      Traders work the floor of the New York Stock Exchange during morning trading on May 05, 2022 in New York City. Stocks opened lower this morning after closing high on Wednesday after the Federal Reserve announced an interest-rate hike by half a percentage point in an effort to further lower inflation.
      Michael M. Santiago/Getty
      – The stock market is poised to make a new low in October after September’s strong jobs report, according to Bank of America.
      – The US economy added 263,000 jobs last month, and the unemployment rate dipped to 3.5%.
      – “Only question for investors is hard landing or soft landing in 2023; we say hard landing,” BofA said.
      …
      https://markets.businessinsider.com/news/stocks/stock-market-outlook-new-low-september-jobs-report-fed-rates-2022-10

  50. The Financial Times
    Charts that Matter Japan
    Negative-yielding debt slides below $2tn as central banks lift rates
    Japan is now the only country with bonds offering sub-zero returns
    Silhouetted pedestrians near the Roppongi Hills complex in Tokyo, Japan
    A business district of Tokyo. The Bank of Japan is swimming against the global tide by holding rates below zero and sticking with its policy of capping longer-term bond yields
    Tommy Stubbington 10 hours ago

    Negative bond yields have become a thing of the past this year, following a string of large interest rate rises by global central banks — everywhere, that is, except Japan.

    Negative yields — which occur when bond prices climb so high that buyers holding them to maturity are guaranteed to lose money — engulfed a large chunk of the global debt market during the depth of the Covid crisis. Those sub-zero levels stemmed from huge central bank stimulus programmes, with the US Federal Reserve and several peers slashing interest rates and buying up swaths of debt in a bid to backstop pandemic-hit markets.

    The total stock of negative-yielding bonds ballooned to a record of more than $18tn at the end of 2020, according to a Bloomberg index of debt trading at yields below zero. But that pile has now dwindled to less than $2tn — all of it in Japan — after the eurozone and Switzerland ended their experiments with negative interest rates in an effort to tackle inflation.

    “This is a stunning reversal given negative-yielding bonds accounted for 40 per cent of the government bond universe at the apex of the pandemic,” wrote analysts at JPMorgan this week.

    In the UK, some short-term debt traded at slightly negative yields as recently as June despite the Bank of England never setting a negative interest rate, according to the Wall Street bank. Yields below zero disappeared from the euro area in September, two months after the European Central Bank lifted its benchmark interest rate to zero, JPMorgan added.

    The almost complete disappearance of negative yields from markets where they were recently commonplace underlines the speed of this year’s shift in monetary policy. It is also the latest sign of the Bank of Japan swimming against the global tide, by holding rates below zero and sticking with its policy of capping longer-term bond yields — so-called “yield curve control”.

    The contrast with rapid increases in borrowing costs elsewhere has pushed the yen to its weakest level in 24 years, sparking speculation that the BoJ could be pressured to raise its yield limit.

    “Sayonara for negative yields may be just months away as we have now brought forward the timing of the BoJ’s yield curve control adjustment” to the first quarter of 2023, JPMorgan said.
    …

  51. ‘There’s a lot of worry in the more urban markets like Northern Virginia, Richmond, and the Tidewater area of prices decreasing. They’re seeing pretty rapid and significant decreases in those areas’

    They fell sorry for you taxpayer – in Harrisonburg.

  52. Bahahahahahahahahahahahahahahahahahahahahahahahaha …

    “NetZero destroys NetZero: Europe can’t make solar panels because green electricity costs too much”

    https://joannenova.com.au/2022/10/netzero-destroys-netzero-europe-cant-manufacture-solar-panels-due-to-high-energy-prices/

    (snip)

    By Jo Nova
    Ironies don’t get better than this: Thanks to the renewable energy transition, Europe can’t afford to make renewable energy.
    When will the message get through that renewable energy is not sustainable?

    Solar Panel Manufacturing assembly line.European photovoltaic plants and battery cell factors are temporarily closing or quitting altogether because of obscenely high electricity prices. When the plants were built they expected to pay €50/MWh, but now they are €300 – 400/MWh. And the situation may last another couple of years, so it’s hard to see how these manufacturers can avoid leaving permanently.

    So much for all the solar jobs. Europeans are being reduced to being installers while the production of panels shifts to coal fired China because electricity is so much cheaper. Most of the wind turbine industry has already moved to China.

    European solar PV manufacturing at risk from soaring power prices – Rystad
    By Jules Scully, PV Tech
    Around 35GW of PV manufacturing projects in Europe are at risk of being mothballed as elevated power prices damage the continent’s efforts to build a solar supply chain, research from Rystad Energy suggests.

    The consultancy noted that the energy-intensive nature of both solar PV and battery cell manufacturing processes is leading some operators to temporarily close or abandon production facilities as the cost of doing business escalates.

    It’s not the only thing in jeopardy:

    “Building a reliable domestic low-carbon supply chain is essential if the continent is going to stick to its goals, including the REPowerEU plan, but as things stand, that is in serious jeopardy,” [said Audun Martinsen, Rystad Energy’s head of energy service research].

    Tell us what “affordable means:

    The consultancy revealed that while power prices in Europe have retreated significantly since record highs in August, rates remain in the €300 – 400/MWh (US$297 – 396/MWh) range, many multiples above pre-energy crisis norms.

    While Europeans have benefitted from reliable and affordable electricity, the research suggested that low-carbon manufacturers have based their build-up of production capacity on stable power prices of around €50/MWh.

    And the country with the most fossil fuels wins:

    The high costs of European PV manufacturing were revealed in a recent report from the International Energy Agency (IEA), which found China is the most cost-competitive location to manufacture all components of the solar PV supply chain, with costs in the country 35% lower than in Europe.

  53. 6 Oct, 2022

    Be careful what you post: How Facebook and the US government have united against Americans with the ‘wrong’ views

    It’s been revealed by sources within the US Department of Justice that direct messages sent through Facebook by American users, along with public postings, have been rigorously monitored, and reported to the Federal Bureau of Investigation (FBI) if they express anti-government, anti-authority views, or if they question the legitimacy of the November 2020 presidential election’s outcome.

    Witch hunt on the web

    Under the terms of a secret collaboration agreement with the FBI, a Facebook staffer has, over the past 19 months, been red-flagging content they consider to be “subversive” and immediately transmitting it to the Bureau’s domestic terrorism operational unit, without the FBI having filed a single subpoena – outside the established US legal process, without probable cause, and in breach of the First Amendment, in other words.

    Just as shockingly, these intercepted communications were then provided as leads and tips to FBI field offices across the US, which in turn secured subpoenas in order to officially obtain the private conversations that they already possessed, and thus cover up the fact the material had been obtained extra-legally. Facebook invariably complied with these subpoenas, and would send back “gigabytes of data and photos” within an hour, suggesting the content sought was already packaged and awaiting legal confirmation before distribution.

    https://www.rt.com/news/563670-big-brother-watches-your-messages/

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