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Are We On The Same Trajectory If 2020 Didn’t Happen, If 2021 Didn’t Happen, If 2022 Didn’t Happen?

A weekend topic starting with Deutsche Welle. “100 years ago, prices in Germany were soaring by 50% each month, a loaf of bread cost millions of mark. How did the young republic rein in inflation? When the young republic was lagging behind with its reparations payments, French and Belgian troops occupied the Ruhr Valley to secure the rich coal mines in the region. The local population went on strike to resist the occupation, and the government in Berlin fired up the money printing presses so that it could keep paying the ‘patriotic’ strikers their wages. ‘Inflation and a loose monetary policy go hand in hand,’ economist Jutta Hoffritz explains.”

“‘I get a lot of stories from people who, as children, found a pack of bills in the attic and felt totally rich for five minutes. It’s like, ‘I’ve found Grandpa’s hidden treasure!’ To their disappointment, Hoffritz reports, her readers were quickly disillusioned: ‘Then grandma comes in and says, yes, that’s what’s left over from 1923. And back then we couldn’t even buy a buttered bread roll with it.'”

From Bloomberg. “The bond market humbled Wall Street’s best and brightest in 2022. Oblivious to what lay ahead — the most-aggressive interest rate hikes in decades — one bond fund manager after another was saddled with heavy losses. Morgan Stanley’s Jim Caron says markets just aren’t prepared for how far US central bankers are willing to go to tame the hottest inflation in a generation. ‘People expect rates to come down and I think we need to listen to what the central bankers are saying,’ and their worries about inflation, said Caron.”

“Scott Solomon and William Eigen, who actively manage at least $1 billion are the only two that have managed to record a gain this year. With core inflation still at 6%, triple the Fed’s target level, Solomon and Eigen believe policy makers will be in no hurry to start cutting rates. Fed Chair Jerome Powell said as much last week, pushing back against market positioning for the Fed to quickly reverse course, after he led the board in lifting borrowing costs at a seventh straight meeting. ‘The Fed has let the inflation genie out of the bottle,’ Eigen said. ‘It’s very difficult to put it back in.'”

“Solomon expresses it this way: ‘The worst-case scenario for the Fed is an inflation path that bottoms and goes back up again, which is why we believe they will be slow to signal significant cuts. Not a lot of the market is willing to recognize that risk.’ ‘Right now people are assuming that the Fed’s going to be rapidly easing by the time we get to mid-year next year,’ Eigen said. ‘I just don’t see it.'”

From David Rosenberg. “This Fed is trying to find any reason to keep on tightening. And it isn’t really about the economy or consumer inflation. It is about asset inflation. It is about financial conditions. It is all about taking the punch bowl away. This Fed is trying to find any reason to tighten, break the multi-decade extreme relationship between the financial economy and the real economy, and extinguish the notion that there is a ‘Fed put.'”

From Mansion Global. “Realtor.com predicted that while inventory of existing homes next year will still lag behind 2019 pre-pandemic levels, it will be up from 2022 by more than 20%. For luxury buyers who didn’t manage to get their hands on a home in one of these growing markets during the pandemic, that means more to choose among—from golf course lots in Las Vegas to beachfront condos in Sarasota, Florida, to foothills mansions in Boise, Idaho. Throughout the summer and fall, inventory has increased dramatically across Las Vegas. The market finished October with 10,034 homes listed, as compared to a low of 5,572 in January.”

“‘There’s more inventory on the market and it’s been growing for the last few months,’ said Avi Dan-Goor, an agent with Douglas Elliman in Las Vegas. Now, though, buyers are returning their attention to those properties, especially after ones that may have had a price adjustment. ‘The perception has completely changed in terms of what a good deal is,’ Mr. Dan-Goor said.”

“As demand has slowed and the time on market has increased, prices are also slumping. The median price for a Las Vegas home decreased to $475,000 as of October, from a peak of $525,000 in May, according to the Las Vegas Realtors report. Luxury properties have seen price reductions anywhere from $100,000 to even multimillion-dollar discounts. ‘There have been a lot of overzealous sellers,’ Mr. Dan-Goor said.”

The Waco Tribune in Texas. “The list of permits issued to build new single-family homes in Waco used to run longer than the proverbial letter to grandma. Now it is more like a blurb, thanks to rising interest rates, recession fears and less confidence speculative homes will find a buyer in a timely fashion. Laura Sterr, a regional sales manager for Stylecraft Builders, said the company started building fewer speculative homes when the fourth quarter of the year arrived. She said Stylecraft also began rationing sales when interest rates were at their lowest ‘because we were getting a lot of investors scooping up everything they could before homeowners could act.'”

“That dilemma has corrected itself as the Federal Reserve raises interest rates. ‘I don’t know if we’ll ever get back to how fast things were 12 to 18 months ago,’ customer homebuilder Keith Gunn said of the breathtaking sales pace builders saw. Homes sold for an average $361,430 in October, 29% more than the $280,212 norm in the same month last year.”

From Market Place. “The housing market in Fresno, California, is not dead. But how’s the market now compared to last year when the influx of remote workers from the Bay Area was in full force? ‘I would say like the tortoise and the hare,’ said Sabrina Brown, a local real estate broker. ‘We have people that are changing jobs,’ she said. ‘They’re saying, ‘No, get back to the office.’ So we have those people [who] are selling, as well.'”

KOKH Oklahoma City. “The market is still in an upward projection, but sellers are seeing fewer showings, offers under the asking price, and requests for home repairs or help with closing costs. ‘Last year you had 20 people trying to drink out of the same water fountain, this year you may have three or four people trying to drink out of the same water fountain,’ said Peter Levinson, Levinson Real Estate. ‘If you take the last couple years in real estate, obviously there was a huge uptick,’ Levinson said. ‘Go back to the market pre-COVID and what we should look at is, are we on the same trajectory if 2020 didn’t happen, if 2021 didn’t happen, if 2022 didn’t happen? Is the market growing as it should have pre-2019?'”

“The Oklahoma City Metro Association of Realtors reports sales year over year dropped nearly a third last month, to just 1,100 transactions, sending inventory soaring 75% to 3,000 listings.”

From Better Dwelling. “Canadian real estate markets went from boom to crash in less than a year. Real estate prices are off the peak in every major market across the country. At the national level, a typical home is down 16.4% (-$142,300) since peaking in March 2022. No market is being spared, with some falling more than 20% from peak—fitting the technical definition of a crash. Markets experiencing the largest percentage point decline have shed a quarter of their value. The biggest drops were observed in London-St Thomas (-26.1%), Kitchener-Waterloo (-25.8%), and Cambridge (-25.1%). All three markets have officially crashed, with 18 major market indexes showing a crash.”

“Those in the Greater Toronto region might have noticed the biggest drops a short drive away. In fact, 9 of the top ten largest price drops occurred in the Greater Toronto region. Special shoutout to Hamilton (-22.6%), a small commuter city about an hour out of Toronto. Canadian real estate’s astronomical growth means very large dollar declines. The largest drops from peak were in Oakville-Milton (-$398,700), Mississauga (-$286,000), and Cambridge (-$249,600). Once again, those markets are all within an hour of Toronto, and considered commuter suburbs. In general, a typical home across Ontario (-$210,900) has seen the price drop significantly since peaking in March 2022.”

“Toronto and Vancouver real estate didn’t quite make the extremes, but they aren’t immune to the correction. A typical home in Toronto has dropped 18.4% (-$245,200) since peaking in March 2022. Over in Vancouver, prices are down 10.5% (-$133,100) from the April 2022 peak.”

“The Canadian real estate price correction is widely blamed on interest rates. Those play a big role when it comes to financing, and profitability for investors, helping to cool demand. However, it’s worth noting that prices peaked in March—before interest rates had a substantial impact on buying power. Most buyers would have a buyer pre-approval that would have limited the impact of the rate hike on absorption.”

“Some banks have argued this reinforces the belief that sentiment was driving growth. Sentiment-driven price growth tends to produce the largest bubbles and sharpest corrections, since the only thing that has to change is the belief prices will always rise. It appears more people are starting to realize prices can’t always go up.”

The Sydney Morning Herald. “In what could only be described as good news for first home buyers, the International Monetary Fund is warning that house prices in Australia could fall sharply in coming years. But in good news for those who already own a home, and who are banking on some nice tax-free capital gain, the policies proposed by the IMF to make housing more affordable have virtually no chance of becoming law in Australia any time soon.”

“Welcome to the topsy-turvy land of Australian housing policy, a land in which our leaders simultaneously pretend they want houses to be ‘more affordable’ for those who don’t yet own them while reassuring those who own one or more houses that we want to ‘protect the value of their assets.’ Talk about having a bet each way.”

“The confusion is no accident. It protects governments and oppositions from having to answer the simple question: ‘Do you want house prices to keep rising or do you think it would be better if they fell?'”

“As it’s impossible to simultaneously please the third of the population which does not own a home and the two-thirds that does, the default politician response is to avoid this simple question with a complicated answer about ‘housing affordability,’ a concept that owes everything to politics and nothing to economics.”

“The key to understanding the politics of house prices in Australia is to realise that the term ‘housing affordability’ is meaningless. While politicians often talk about the price of petrol, electricity and airfares, you’re unlikely to hear a prime minister or opposition leader talk about ‘petrol affordability’ or the ‘ratio of electricity prices to median income.’ They are certain they prefer low petrol prices and airfares to high ones, but they prattle on about ‘affordability’ with housing because they don’t know whether they want home prices to rise or fall, or they don’t want to make their priorities clear.”

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This Post Has 184 Comments

  1. ‘Welcome to the topsy-turvy land of Australian housing policy, a land in which our leaders simultaneously pretend they want houses to be ‘more affordable’ for those who don’t yet own them while reassuring those who own one or more houses that we want to ‘protect the value of their assets.’

    I appreciate that economists question things like this, but it’s a bit misleading to state that it’s an either or with manias. It’s policy. Well bubbles make you poor and then they pop, so there’s that. But it is also short sighted. We didn’t have this for centuries. Bubbles were confined to brief episodes in Mississippi or Florida or the South Seas wrapped up in fraud and crooks. The more we spend on shacks and the interest from that, the less we have to spend on other things. Then it crashes. It’s a lose lose arrangement in the end. Only the colossal idiots of central banks think this is a valid tradeoff.

    1. Real estate bubbles destroy economic activity by artificially inflating rents and leases to the point where prospective businesses cannot sprout and blossom because there is no product that can be delivered to the market at a price which makes sense since the lease is eating up all the business profits.

    2. Only the colossal idiots of central banks think this is a valid tradeoff.

      If it allows them to hoover up assets then I would say it makes perfect sense, for them. This of course assumes that there won’t be civil unrest. Kind of hard to collect rent when your properties are being burned to the ground.

  2. ‘When the young republic was lagging behind with its reparations payments, French and Belgian troops occupied the Ruhr Valley to secure the rich coal mines in the region. The local population went on strike to resist the occupation, and the government in Berlin fired up the money printing presses so that it could keep paying the ‘patriotic’ strikers their wages’

    And we get WW2! Demonizing entire populations and punishing them with unknown consequences for all! Sound familiar?

    2. Kinda like the Brandon regime designating 75 million “MAGA Republicans” as Enemies of the State.

      2. Further alienating and radicalizing the people who pay the bills and perform the economy’s essential functions maybe isn’t the wisest course of action.

  3. ‘The worst-case scenario for the Fed is an inflation path that bottoms and goes back up again, which is why we believe they will be slow to signal significant cuts. Not a lot of the market is willing to recognize that risk.’ ‘Right now people are assuming that the Fed’s going to be rapidly easing by the time we get to mid-year next year,’ Eigen said. ‘I just don’t see it’

    When I was growing up I’d see inflation talked about on the TV. It didn’t seem to go away. No one was sure it was over. Then surprise, it’s back!

    You really had one high paying job Jerry and you fooked it up. Now WE get to spend a few years or 10 cleaning up.

        1. Every dollar these gold collar criminals create out of thin air steals value from every honestly earned or inherited dollar in existence.

    2. “This Fed is trying to find any reason to keep on tightening. And it isn’t really about the economy or consumer inflation. It is about asset inflation.”

      The growth in asset prices roughly tracked with income growth up until 1990 when economic policy was changed. Since then, asset prices have steadily outpaced income. Today, young entrants to the economy are simply priced out of assets, and find themselves wallowing in college debt with low paying jobs.

      So what happened in the 1990s to precipitate this inequality?

        1. What happened in the 1990’s was the elimination of the Glass/ Stegal laws and the sell out to Globalism and free trade by Washington DC.
          The gutting of jobs and manufacturing based to be transferred to low wage places like China. Replacement by rigged economic systems of unsustainable debt and fake wealth creation by speculation like housing .
          College degrees getting low paying jobs that didn’t justify the high cost of student debt. ..
          Government interference in Capitalism by backing bad debt, bailing out the fraudulent to big to fail, fostering profits to
          Industries not benefiting Public, just looting of people. Communist Obamacare as a looting system to extract wealth from middle and upper middle class to maximize profits for Big Pharmacy dominated medical system.
          For instance Medical System wanted over 4 trillion A year under Obamacare, yet for a decade Big Pharmacy was listed as the third cause of death in US.
          So your forced to pay high amounts to a medical that gets poor results….
          You pay expensive education for a job that doesn’t exist because
          of a stupid government backed student loan.
          So you have capitalism destroyed by Government propping up looting by industry.
          So, with all the rigged systems on the verge of collaspe, especially unsustainable debt, you have governments aligning with the looters and One World Order/Great Reset.
          But, it was a slow gradual take over by the One World Order Entities with extreme progress from 1990 onward.

          1. We all got to watch this trainwreck playout in slow motion over the past few decades. As long as it wasn’t their job being offshored most people shrugged, or maybe they would admit that it was bad, but we could we do about it?

            I remember when a $50B federal budget deficit was considered a very big deal by some. But with a few exceptions, the deficit grew steadily, year after year.

            The levels of homelessness that most shrug off as normal these days would have been cause for alarm and panic not too long ago.

            It is like we are the proverbial frog in the boiling pot. We tell ourselves that as long as we individually are OK, then all is well, and we refuse to see what is happening around us.

      3. So what happened in the 1990s to precipitate this inequality?

        Does her name rhyme with pillory?

        1. The repeal of Glass-Steagal set the stage for the unbridled Wall Street greed and recklessness we’ve seen since the Clinton Administration.

          1. Not exactly. For one thing, Glass-Steagall was never repealed in its entirety, otherwise we would no longer have an FDIC. Only the section of Glass-Steagall relating to the separation of retail and commercial banking was repealed. Also, the manic money printing started under Alan Greenscam and fueled the rise of the McMansion and many a dubious dot-com startup.

      4. Bringing Asia under the globalism umbrella, allowing them to use their bottomless well of serf-wage labor to do what US citizens used to do. Worked out great for the rest of the globe. For the US, not so much. But that’s coming to an end, fast.

        2. China’s youth are rejecting a future where they toil away under slave labor to enrich foreign corporations and the parasitic scions of CCP apparatchiks while living under totalitarian rule and with a bleak soulless existence that comes from living under socialism. The “let it rot” movement could end up being a serious challenge to the CCP tyrants if the younger generations effectively opt out of the sh*tty deal they’re being offered by the Powers that Be.

          https://www.youtube.com/watch?v=IfgFNRnXCMc&t=397s

    3. People like butters who think you can go on a deranged money-printing spree like the FED just did, then solve it with some paltry rate hikes to a level 4% below CPI over the course of 9 months are delusional. This will take years and years to fix.

      If the FED were to start cutting rates again mid year, then inflation will take off like a rocket and spike to even higher levels than before, forcing the FED on an even more aggressive path to try to contain it. People like butters have no concept of inflation.

      1. IIf the Fed authorized the US Treasury to “print” 800 quadrillion in 1000 dollars bills and stored it in Fort Knox, what effect does it have?

      2. If we lived in a sane world, I would fully agree with you. But we live in Clownworld, and it was the central bankers who got us into this mess in the first place.

        I do agree that it will take a long time to fix this mess, but that assumes that central banks and national governments will do the right thing. I am unconvinced that they will, at least not until their hands are forced,

  4. ‘Homes sold for an average $361,430 in October, 29% more than the $280,212 norm in the same month last year’

    Waco.

    ‘‘If you take the last couple years in real estate, obviously there was a huge uptick…Go back to the market pre-COVID and what we should look at is, are we on the same trajectory if 2020 didn’t happen, if 2021 didn’t happen, if 2022 didn’t happen?’

    What yer really saying Peter (can I call you Dick, Peter?) is, can we just pretend that Jerry and co didn’t create 40% of the pesos that existed before CCP virus. So Dick, that happened. I’m amused at these people like senator running deer stamping their feet about interest rates. What created all the inequality senator? How long has that gone on, 30 or 40 years? Should we question why we are here in the first place? Yer an old fart, you can remember when Boston shacks cost the same as Waco Texas.

    1. senator running deer stamping their feet about interest rates.

      Elizabeth Warren has rental houses. She’s speculating like all of these political hacks.

  5. ‘Canadian real estate markets went from boom to crash in less than a year’

    ‘The Canadian real estate price correction is widely blamed on interest rates. Those play a big role when it comes to financing, and profitability for investors, helping to cool demand. However, it’s worth noting that prices peaked in March—before interest rates had a substantial impact on buying power. Most buyers would have a buyer pre-approval that would have limited the impact of the rate hike on absorption’

    ‘Some banks have argued this reinforces the belief that sentiment was driving growth. Sentiment-driven price growth tends to produce the largest bubbles and sharpest corrections, since the only thing that has to change is the belief prices will always rise’

    Better Dwelling leaves the entire K-dn media behind year after year.

  6. Morgan Stanley’s Jim Caron says markets just aren’t prepared for how far US central bankers are willing to go to tame the hottest inflation in a generation.

    What a crock of sh*t. The Fed has no intention of “taming” inflation. Raising interest rates is meaningless when the Fed continues to issue more debt, then buy it back with Yellen Bux “money” created with keystrokes.

  7. With core inflation still at 6%, triple the Fed’s target level, Solomon and Eigen believe policy makers will be in no hurry to start cutting rates.

    Real inflation is at least double what our fake, Soviet-style CPI stats say it is.

  8. This Fed is trying to find any reason to tighten, break the multi-decade extreme relationship between the financial economy and the real economy, and extinguish the notion that there is a ‘Fed put.’”

    More BS. The Fed since its clandestine 1913 establishment by the robber barons of the era has had only one true “mandate”: to serve as the oligarchy’s chief instrument of plunder against the 99%. Fed-engineered boom/bust cycles have been the most efficacious means of transferring the wealth and assets of the increasingly pauperized middle and working classes to the Fed’s private equity accomplices. The MSM, owned and controlled by the same rapacious oligarchs who have been looting & asset-stripping the 99% since time immemorial, practices a journalistic omertà when it comes to the Fed and its fiat currency swindles. Trading our soon-to-be-worthless Yellen Bux for physical precious metals is literally our only defense against the Wall Street-Federal Reserve Looting Syndicate.

  9. ‘Last year you had 20 people trying to drink out of the same water fountain, this year you may have three or four people trying to drink out of the same water fountain,’ said Peter Levinson, Levinson Real Estate.’

    Lie all you want to, Peter, but the data tells its own story. With shack prices falling month after month, only imbeciles are buying into a bursting housing bubble.

  17. A reader sent these in:

    1/2 For the last 15 yrs, only the US stock mkt (blue) has made global investors money. The collective of the rest of the world’s stock mkts (orange) has not. 15 yrs of QE, Fed puts, forward guidance, and a belief that the Fed and the Government “had investor’s back” drove this.

    https://twitter.com/biancoresearch/status/1608914250201960448

    1/5 The final results for a year unlike any other in the bond market.

    https://twitter.com/biancoresearch/status/1609234999936524292

    Treasury been doing QE for months to fight the fed until last week… now we know why Q4 didn’t crash. And all of them now draining liquidity very fast.

    https://twitter.com/ClaymmorezChart/status/1609172853173231619

    Housing will explode in 2023. U.S. price / income is record high via OECD: https://data.oecd.org/price/housing-prices.htm
    In 2006, months’ supply of homes exploded when prices rolled over. Now it’s already rising. Pending home sales lowest in two decades.

    https://twitter.com/SuburbanDrone/status/1609250452528398338

    It’s 2023 in Australia, so charts are back. What magnitude of criminality can hide in lagged data, we will discover in 2023. Turn that clown upside down.

    https://twitter.com/SuburbanDrone/status/1609255143098179586

    Remember the “work from home” Tech stocks ? Now most of those stocks are already below their March 2020 lows before Covid. Is this the low? Or more to fall ???😰

    https://twitter.com/WallStreetSilv/status/1609142469177839618

    This guy lost $2 million dollars trading stocks and now he’s working at a deli. Much respect for being so honest and sharing his story. Imaging how many millions of people this has happened to. The Fed’s crazy policies of boom and bust affects lives.😳

    https://twitter.com/WallStreetSilv/status/1609182024664858625

    The Fed creating the 0% rates and insane boom cycle lures many people into thinking they are brilliant investors and can do no wrong. That unlimited QE resulted in misallocation of capital in many parts of the economy. Massive Fed intervention breaks pricing signals.

    https://twitter.com/WallStreetSilv/status/1609183149828841474

    Confirmed: Great Depression version 2.0 coming during 2023 🚨
    Quote Tweet
    Dec 31, 2022
    ECB’S PRESIDENT LAGARDE: THE RECESSION WE FEARED IS LIKELY TO BE SHORT-LIVED AND SHALLOW.

    https://twitter.com/WallStreetSilv/status/1609204389700304906

    Did anyone even notice this? 🧐 This was supposedly hidden away in the recently passed infrastructure bill 🚨 Not sure how accurate it is. Article says 5 years until it is enforced.
    Source: https://autos.yahoo.com/autos/law-inst

    https://twitter.com/WallStreetSilv/status/1609267110697484289

    CarDealershipGuy

    37.5%. Why this number is a problem (and what it means for the used car market):

    https://twitter.com/GuyDealership/status/1608821903963168770

    CarDealershipGuy

    Never forget

    https://twitter.com/GuyDealership/status/1608882312141471745

    Danielle DiMartino Booth

    Fed did add fuel to fire that was the bubble initially inflated by fundamentals in form of urban exodus to suburbs & exurbs. To suggest that the Fed hoovering up 1/3 of MBS market throughout the mania did not turboinflate trend is naive at best (I say this w/deepest of respect)
    Quote Tweet
    Agree on fiscal. Very tired of the “It was the Fed” arguments

    https://twitter.com/DiMartinoBooth/status/1609057344209707009

    Firstly, housing in deep freeze is key. It’s especially relevant because the Fed is saying 4.4-4.7% unemployment for year end 2023. Many realtors, mortgage brokers, chimney repair teams, carpet installation crews, masons and 100 other professions are going to have a tough 2023.

    https://twitter.com/JeffWeniger/status/1609248808478838785

    CarDealershipGuy

    I’m helping a private G-Wagon client. He’s made several offers with no luck. In the last 24-hrs: Every dealer has called him back and begged him for his original offer. Probably nothing…

    https://twitter.com/GuyDealership/status/1609190633163395075

    Rick Palacios Jr.

    Cost of owning vs. renting a home became focal point in our housing coverage throughout 2022. Home prices historically need a reset when the premium of owning explodes this high, this quickly.

    https://twitter.com/RickPalaciosJr/status/1609259823262224384

    Question: do you think it is reasonable for @rabois – a man who claimed to know more about real estate than anyone alive – to call this the worst housing crash for half a century? Is this worse than 2008? https://twitter.com/rabois/status/

    https://twitter.com/John_Hempton/status/1608887053248524288

    The guy who started a house flipping company claiming to know more than anyone about real estate with said company’s stock down over 90% now recognizes the housing bust he was warned about for over a year. Quote Tweet
    Keith Rabois
    Dec 30, 2022
    Replying to @John_Hempton
    yes it is worse than 2008, again this is an empirical statement not a subjective one.

    https://twitter.com/GRomePow/status/1609266134272053248

    Fraud mortgages will come to surface more than ever in this market condition. Especially as rates continue to rise.

    https://twitter.com/EstateLevy/status/1609270495865704450

    Put 20% down on a home so you can pay twice as much as rent would be. Oh, and when the market drops 20% you lose 100% of your down payment. I’m good. I’ll wait this one out.

    https://twitter.com/RyanCrownholm/status/1609269934315704320

    Here’s one compelling reason why 2023 is likely to be full of surprises: Americans (& their politicians) only know life under an ever-expanding money supply. As measured by the chart below, it’s now shrinking…

    https://twitter.com/menlobear/status/1609292982955704321

    Worst house price declines in 42 years, with more to come… https://bit.ly/3WQ6UIW

    https://twitter.com/cjoye/status/1609171496383172615

    40.2% (!) of Coca-Cola’s U.S. revenue comes from SNAP benefits (food stamps) What an evil use of taxpayer money. Here’s the math:

    https://twitter.com/calleymeans/status/1608618928561074177

    I’m reminded that ~36% of high income people live paycheck-to-paycheck

    https://twitter.com/LoprestiJohn/status/1609296313442615296

    Lyn Alden

    People have been posting doom charts of the Fed’s remittances to the US Treasury. I think the right question to ask, is who is on the other side of that? If the Fed is paying out higher rates on its liabilities than its assets, who holds those liabilities? Maybe invest there.

    https://twitter.com/LynAldenContact/status/1609297999674626048

    Happy New Year to everyone, except those that think the Fed Funds rate should be below 10%

    https://twitter.com/GRomePow/status/1609380077334302720

    1. “CarDealershipGuy: 37.5%. Why this number is a problem (and what it means for the used car market):”

      Savvy debtors caught in a squeeze back in my repo days would leave their unlocked car near a ghetto with a 5th of whisky in the glove compartment, a case or two of malt liquor in the trunk and the keys in the ignition. Their insurance paid-off on the wreck. Credit rating intact!

    3. This guy lost $2 million dollars trading stocks and now he’s working at a deli.

      He wanted to be a billionaire. Now he asks if you would like fries with your order.

    4. CarDealershipGuy

      Never forget

      Holy Moley, they all had $1200+ monthly payments, and some had more more than one . Also, it appears they all work at a car stealership. The commissions these past two years must have been out of this world. I’m gonna guess that they won’t be as good this year.

        1. Every one of those people are Millennials and Gen Z (Zoomers). While the FED has done them no favors, they have a hand in their own demise. Only ridiculously stupid people sign up for such massive auto loans. If you can’t pay cash for the car, you can’t afford the car.

      2. That was insane.

        Also every car sales person I’ve ever met lived in the moment. Oh it’s good this month I”ll buy something really expensive. Oh it’s bad, I’ll sell that thing i just bought at a huge loss cuz I have no savings.

        every one of them.

        And they always need a new car, every year at the most. “oh i got a good deal cuz the owner and i are best buds”.

        1. And they always need a new car, every year at the most. “oh i got a good deal cuz the owner and i are best buds”.

          Instead of paying $80K for the truck, I got it for $75K!

    5. Did anyone even notice this? 🧐 This was supposedly hidden away in the recently passed infrastructure bill

      The car kill switch thing is old news. IIRC, it should start in 2026.

    6. That unlimited QE resulted in misallocation of capital in many parts of the economy. Massive Fed intervention breaks pricing signals.

      Like, for instance, “flipping new cars” by people who are not even licensed dealers, but Johnny-come-latelys. They would buy a brand new car at retail msrp, or even above, then list it for sale as “new” (it’s not) with an added $50,000 markup. Only in clown world could you ever flip a new car for a profit after buying it at the dealer for full price.

      1. Who’s buying these cars, when a buyer could just walk into a dealership themselves? And which cars are they buying? Certainly not dime-a-dozen Camrys. Ultra-luxury? At that point I guess it’s more like collecting modern art.

        1. They were the luxury cars, and you couldn’t just walk into a dealership and buy it, they had to be ordered and you’re on a waiting list. They were flipped to crypto bros and PPP loan fraudsters and all sort of “pay anything ballers.” The entire situation was ridiculous.

        2. I think the idea is that the car is not in stock and the wait was months long. My neighbor had to wait half a year to replace his wrecked Subaru Forester.

          That is ending, even for the most popular models.

  18. Color your money gone, Evergrande creditors.

    Evergrande Misses Overhaul Proposal Deadline Amid Creditor Talks

    https://www.bloomberg.com/news/articles/2023-01-01/evergrande-misses-overhaul-proposal-deadline-amid-creditor-talks?

    China Evergrande Group delayed releasing a much-anticipated restructuring plan again, missing a self-imposed deadline and disappointing creditors seeking to salvage investments.

    The world’s most indebted developer has yet to announce its offshore debt-restructuring plans, falling short on its promise to do so by the end of 2022. Evergrande didn’t immediately respond to a request seeking comment during non-business hours.

    1. “Evergrande Misses Overhaul Proposal Deadline Amid Creditor Talks”

      They certainly are doing an outstanding job of dragging this mess out.

  19. 𝗔𝗻𝗻𝗮𝗻𝗱𝗮𝗹𝗲, 𝗩𝗔 𝗛𝗼𝘂𝘀𝗶𝗻𝗴 𝗣𝗿𝗶𝗰𝗲𝘀 𝗖𝗿𝗮𝘁𝗲𝗿 𝟮𝟳% 𝗬𝗢𝗬 𝗔𝘀 𝗡𝗼𝗿𝘁𝗵𝗲𝗿𝗻 𝗩𝗶𝗿𝗴𝗶𝗻𝗶𝗮 𝗦𝗲𝗹𝗹𝗲𝗿𝘀 𝗦𝗹𝗮𝘀𝗵 𝗗𝗼𝘂𝗯𝗹𝗲 𝗗𝗶𝗴𝗶𝘁𝘀

    https://www.movoto.com/annandale-va/market-trends/

    𝘈𝘴 𝘰𝘯𝘦 𝘯𝘢𝘵𝘪𝘰𝘯𝘢𝘭 𝘣𝘳𝘰𝘬𝘦𝘳 𝘭𝘢𝘶𝘨𝘩𝘦𝘥, “𝘏𝘰𝘶𝘴𝘪𝘯𝘨 𝘱𝘳𝘪𝘤𝘦𝘴 𝘢𝘳𝘦 𝘧𝘢𝘭𝘭𝘪𝘯𝘨…. 𝘢𝘴 𝘴𝘦𝘭𝘭𝘦𝘳𝘴 𝘨𝘰 𝘣𝘰𝘰 𝘩𝘰𝘰 𝘩𝘰𝘰.”

    1. as Long as They Can Find Water

      You mean buy it. Every drop of water in the southwest is accounted for and has an owner. And it’s not cheap.

  21. Have a cratering new year my good friends….. have a cratering new year…. enjoy this new year filled with falling housing prices. Crater Strategies & Company will saturate the internet with the good news of falling housing prices.

    Rye, NY Housing Prices Crater 16% YOY As Inventory Skyrockets Across Metro NY/NJ/CT

    https://www.movoto.com/rye-ny/market-trends/

  22. “‘People expect rates to come down and I think we need to listen to what the central bankers are saying,’ and their worries about inflation, said Caron.”

    Risk asset HODLers are in denial about the Fed’s intentions, and have priced capitulation on inflation containment into their irrationally exuberant risk asset valuations.

    There’s a lot more downside risk ahead as HODLers move on from denial to anger, bargaining, depression and acceptance. The Fed means business, and no more alcohol is forthcoming in 2023.

  26. Is all the soft landing happy talk setting up Wall Street for another brutal leg down if things don’t turn out so well?

    1. Economy
      Published December 29, 2022 2:05am EST
      US economy can still have a ‘soft landing’: report
      Measures expected to support the labor market are the Infrastructure Law, the Chips and Science Act and the Inflation Reduction Act
      By Ken Martin FOXBusiness
      LPL Financial chief global strategist Quincy Krosby argues the Federal Reserve is ‘on the path out of’ inflation. video
      It’s ‘amazing’ economy has remained ‘resilient’: Quincy Krosby

      Heading into the new year, the Biden administration believes the U.S. economy can still achieve a”soft landing.”

      Supporting theories that the large-scale government investments will help boost the labor market in the months and years ahead, a top adviser to the president told the Financial Times. 

      Those comments are from Heather Boushey, a member of the White House council of economic advisers.

      The stand by the White House comes as many economists fear a significant slowdown and possibly a recession is on the horizon as the Federal Reserve continues to aggressively raise interest rates to fight inflation.
      …
      https://www.foxbusiness.com/economy/us-economy-can-still-have-a-soft-landing-report

    2. Barron’s
      Economy & Policy
      Up and Down Wall Street
      The Bulls’ Worst Recession Fear: There Won’t Be One
      By Randall W. Forsyth
      Dec. 30, 2022 7:51 pm ET
      This could be the last bull standing on Wall Street if the Federal Reserve does what it has threatened to do.
      Drew Angerer/Getty Images

      “There ain’t gonna be no recession,” Pierre Rinfret, an economist who once advised the Nixon administration, confidently declared in December 1969. Better at attracting publicity than forecasting, he admitted his error after the economy began a downturn that very month that would last through November 1970. Not even his ungrammatical double-negative, which might be construed pedantically as a prediction of a recession, could erase that bombastic blunder.

      With that in mind, there nevertheless is justification now to go against Wall Street’s consensus forecast that 2023 is certain to bring a recession. The corollary is that the Federal Reserve will reverse course, begin to ease monetary policy, and power a new bull market.
      …
      https://www.barrons.com/articles/stock-market-recession-economy-fed-51672447470

      1. Prof i still see there is a shortage of minimum wage workers and a glut of $30 hr “Professional” jobs

        1. Those $30/hour jobs may come with discriminatory qualification requirements that make it hard to identify a candidate.

          1. There will be plenty of applicants for those jobs, but employers may decide that none of them are good enough. And it may be possible, despite claims to be an EOE, that many of those openings are really only open to non existing protected class candidates.

  28. Is the stock market past its difficulties, with clear blue skies and a soft landing ahead in 2023?

    1. After $18 Trillion Rout, Global Stocks Face More Hurdles in 2023
      – Recession, rate hikes risk spurring earnings slowdown in 2023
      – Question marks remain over how Big Tech and China will fare
      By Jan-Patrick Barnert
      December 29, 2022 at 9:00 PM PST

      More tech tantrums. China’s Covid surge. And above all, no central banks riding to the rescue if things go wrong. Reeling from a record $18 trillion wipeout, global stocks must surmount all these hurdles and more if they are to escape a second straight year in the red. 

      With a drop of more than 20% in 2022, the MSCI All-Country World Index is on track for its worst performance since the 2008 crisis, as jumbo interest rate hikes by the Federal Reserve more than doubled 10-year Treasury yields — the rate underpinning global capital costs. 
      …
      https://www.bloomberg.com/news/articles/2022-12-30/after-18-trillion-rout-global-stocks-face-more-hurdles-in-2023?leadSource=uverify%20wall

      1. “With a drop of more than 20% in 2022, the MSCI All-Country World Index is on track for its worst performance since the 2008 crisis,…”

        the difference being that with raging fires of inflation to contain, no central bankers are waiting in the wings with Quantitative Easing to put the brakes on CR8Ring risk asset prices. The Greenspan-Bernanke Put is dead.

    2. Yahoo Finance
      2022 was an unusual year for the stock market 📉
      Sam Ro
      Sun, January 1, 2023 at 5:42 AM PST·8 min read
      This post was originally published on TKer.co

      The S&P 500 closed Friday at 3,839.50, down 19.4% for the year. This makes 2022 the worst year for the S&P since 2008 and the fourth-worst year since the index’s launch 1957.¹

      While it may be the case that the stock market usually goes up, 2022 was a reminder it doesn’t always go up. This is just part of the deal when it comes to successful long-term investing. The road to stock market riches comes with lots of ups and downs.
      …
      https://finance.yahoo.com/news/2022-was-an-unusual-year-for-the-stock-market-%F0%9F%93%89-134223630.html

    3. The Financial Times
      Global Economy
      Recession will hit a third of the world this year, IMF chief warns
      Kristalina Georgieva says next couple of months will be ‘tough for China’ due to spread of Covid
      Kristalina Georgieva
      Patrick Temple-West in New York and Lauren Fedor in Washington
      4 minutes ago

      A third of the global economy will be hit by recession this year, the head of the IMF has said, as she warned that the world faces a “tougher” year in 2023 than the previous 12 months.

      The US, European Union and China are all slowing simultaneously, Kristalina Georgieva, IMF managing director, said.

      “We expect one-third of the world economy to be in recession,” Georgieva told US TV network CBS in an interview that aired on Sunday, adding that “half of the European Union will be in a recession” this year.

      The IMF cut its 2023 outlook for global economic growth in October, citing the continuing drag from the war in Ukraine as well as inflation pressures and rises in interest rates by major central banks.

      The rapid spread of Covid in China now that its president Xi Jinping has dropped the country’s severe containment policy means that the country faces a fresh economic blow in the short term, Georgieva said.

      “For the next couple of months, it would be tough for China, and the impact on Chinese growth would be negative, the impact on the region will be negative, the impact on global growth will be negative,” she said.
      …

  29. With sincere apologies to St Greta, would this be a good time to HODL oil stocks? 🛢️ 🛢️ 🛢️

    1. The Financial Times
      Oil & Gas industry
      Exxon and Chevron share $100bn in profit after surge in oil prices
      Record haul during Ukraine war marks reversal of fortunes after pandemic demand crash
      Wilmington Oil Fields south of Los Angeles
      US oil titans have resisted calls to pivot from fossil fuels to combat climate change
      Justin Jacobs in Houston 2 hours ago

      ExxonMobil and Chevron are expected to rake in almost $100bn in combined profits from 2022 as the US corporate oil titans capitalise on surging fossil fuel prices following Russia’s invasion of Ukraine.

      The profit bonanza is seen by the oil majors as vindication after the companies resisted pressure from activists and some shareholders to pivot away from their core oil and gas businesses and slash climate-warming emissions.

      Exxon was expected to record more than $56bn in profits in 2022 and Chevron is set to top $37bn, record highs for both companies, according to Wall Street estimates compiled by S&P Capital IQ.
      …

    2. BTU $28.01
      $0.16 0.56% 54%
      IBD Stock Analysis

      Peabody Energy (BTU) is Tuesday’s IBD Stock Of The Day, as the U.S. coal producing giant looks to capitalize on increased demand for coal, driven by rising natural gas prices this winter. BTU shares edged higher Tuesday, closing in on an early entry point.

      U.S. natural gas prices advanced for a fifth straight session Tuesday, trading up 5.5% to around $7 per million British thermal units. Natural gas prices are up almost 29% from a Dec. 6 low, amid forecasts for cold weather across the country. On Monday, U.S. natural gas prices soared around 10%.
      …
      https://www.investors.com/research/ibd-stock-of-the-day/peabody-energy-burns-hot-near-buy-point/

      1. A few decades ago, in a previous version of my life, I had a gig tutoring the son of a Peabody exec in math. The kid had to skip his senior year of high school due to illness, and was prepping for his GED. He hated math with a passion, making my job interesting.

        I was rightfully proud when he passed his exam. His highest score was in the math component.

  30. Globalism and free trade was designed to destroy the US.
    The US manufacturing and job base was rendered non competitive by transfer of manufacturing and jobs to lowest wage production Countries like China .
    The excess profit by cheap labor is transferred to the producer at the cost of labor. . The US got poorly manufactured China junk whereby the labor monopoly in places like China gutted and destroyed jobs and manufacturing in places like the US.

    .nothing more than Rockerfeller Monopoly model played out on a Global

        2. Trials by vaccine Companies that only lasted for about three Months, where adverse reactions and death after three months not counted. In other words, no longer term analysis of adverse effects from vaccines that took longer to develope.
          For decades Big Pharmacy bred rats for trials that didn’t show short term damage but it would come out longer term. .
          Trial test subjects being gaslighted on adverse events and a under reporting on
          injury from adverse reaction to vaccine

          Trials rigged to have extremely healthy subjects that doesn’t represent A cross
          section of likely users of the drug.
          This was a new technology expierment vaccine that was released without safety
          confirmed
          ..And don’t tell me the fake vaccine worked….

          4. not so new

            From September 3, 2018
            Can mRNA disrupt the drug industry?
            Messenger RNA technology promises to turn our bodies into medicine-making factories. But first Moderna—and a long list of old and new competitors—needs to overcome some major scientific challenges

          5. The jabs embody a myriad of patented technologies with varying degrees of newness and applications.

          1. He’s a grifting retired nurse with a PhD focused on the development of open learning resources for nurses nationally and internationally. He has neither the education nor training to understand these technologies.

        1. https://us.youtubers.me/dr-john-campbell/youtube-estimated-earnings

          Dr. John Campbell estimated earnings by months
          month estimated earnings
          December 2022 $ 6.28K
          November 2022 $ 16.9K
          October 2022 $ 18K
          September 2022 $ 7.08K
          August 2022 $ 10.7K
          July 2022 $ 11.6K
          June 2022 $ 11.1K
          May 2022 $ 7.2K
          April 2022 $ 8.34K
          March 2022 $ 15K
          February 2022 $ 9.09K
          December 2021 $ 84.3K
          November 2021 $ 83.4K
          October 2021 $ 12.9K
          September 2021 $ 10.4K
          August 2021 $ 6.16K
          July 2021 $ 3.33K
          June 2021 $ 4.61K
          May 2021 $ 8.44K
          April 2021 $ 4.24K
          March 2021 $ 4.01K
          February 2021 $ 5.32K

  33. I accidentally pressed before I completed post.

    So, what you got now is a group of International Mega Monopoly corporations under the WEF, Banks and
    rich Elites wanting a One World order dictorship where they rule.
    They infiltrated world governments to implement their One World takeover.
    They censored the news so they could defraud the Globe and launch their weapons of mass destruction , genocide, and destruction of sustainable energy and food production.
    A corrupted United Nations to do the bidding of these forces by Pandemics and Climate Change Emergencies for a tyranny of Global scale.
    These Entities want to have a Great Reset that reduces the human race to enslaved and deprived people, owning nothing, eating bugs , hacked and injected, with no freedoms.
    The human race can stop them now before they carry out this horrible agenda of more crimes against humanity, and eventual enslavement or genocide.

    1. Remember, as far as they are concerned, they own the whole world. Were are simply clutter to them. Unless we are directly beneficial to them, we are useless eaters, vermin who need to be exterminated.

    2. Your theory has one major flaw. And that is, the “elite” of the NWA are 100% dependent on the little people that they want to rule. People like Klaus Schwab and Bill Gates wouldn’t last a few months if they were completely cut off from supplies and deliveries from the outside world. The elite don’t produce one ounce of flour, beef or carrots–they don’t produce a drop of jet fuel or gasoline. They can’t make one watt of electricity or one aspirin tablet.

      In short, without the resources of little people, they would all starve to death. Sure, they may have big stockpiles or emergency supplies, but those would only last a short time. And they live in huge easily identifiable homes that can be overrun by a mob of 1,000 angry people who possess Molotov cocktails.

      They are 100% dependent on small private security forces. They certainly can’t depend on government armed forces which are composed of low paid little people, to defend them. Sure, the generals and high ranking officers might belong to the elite club, but all of them would be shot dead by the enlisted ranks.

      So Oprah, Bill Gates and the rest of the elites will be sitting ducks in their compounds. What happens if all the truck drivers refuse to deliver things to the businesses that cater to the rich? Civilized society depends on 99.999% of the people agreeing to participate in being civilized. It only takes a small number of troublemakers to upset the apple cart.

      The fact is today the ruling class has less power than they’ve ever had because they depend on billions of people following the rules of governments. All it takes is a really SERIOUS disaster like a total breakdown of the electrical grid or food shortage which leaves people starving to set off a mass riot.

      If even all the truck drivers and train engineers decide to strike, all the big cities on the earth will quickly descend into chaos and violence since all the store shelves will be emptied in the span of weeks. That kind of situation would be Hell on Earth.

      1. the “elite” of the NWA are 100% dependent on the little people that they want to rule.

        Well, the productive ones with a marketable skill set. I would say right off the bat that anyone who is not gainfully employed is expendable.

      2. And they live in huge easily identifiable homes that can be overrun by a mob of 1,000 angry people who possess Molotov cocktails.

        I like sentences like this.

        1. That’s why they have to try to balance the social unrest thing, by sharing some of the pie with the masses. But greed is greed and at some point they just can’t help themselves and they go past the event horizon.

          That said, I am worried about the engineered famine thing, as it kills two birds with one stone. First of all, it exterminates millions, if not billions, of undesirables. Secondly, they can blame it on climate change and not only will there not be any torches or pitchforks, but the remainder will submit to any absurd request to “save the world”: give up your car, freeze/swelter, eat bugs, and any other evil thing they can come up with.

          Remember, the scamdemic was the dress rehearsal.

          3. I don’t think I will starve to death or freeze, so I’m not afraid for myself. But I do worry about what they will try to impose on others. And all this “we’re cutting back on farming by 30%” will have consequences.

      3. zzy,
        I don’t think the NWO will be sucessful in taking over the World and enslaving the human race. Im only talking about what they say they are going to do.
        The NWO narratives are breaking down and global populations are becoming aware that a sinister force wants to do bad things to them. A infiltration and corruption of Governments that are implementing the New World Order agenda. Rigged election to place puppets for the NWO.Destruction of small business and destruction of competition to the One World Order.
        They think they are going to socially engineer populations into the Great Reset by censorship , extortion , bribery, fraud , fear ,etc etc. All the methods used to get people to do stuff against their own interest.
        They make no apologies for a World where they plan to own everything , you will own nothing, eat bugs, deprived of freedoms, hacked and injected, living in 15 minute cities, which are prisons of confinement.
        They justify altering the human race by their deranged medical treatments .
        Humanity can do a lot better than where the One World Order wants to steer the globe. Why do we need this small group of parasites , looters, psychopaths, crooks, fraudsters and murderers that have a inhumane vision of a 1984 type of existence for the populations of the World?
        They are the virus that needs to be eliminated once and for all.

        1. They are the virus that needs to be eliminated once and for all.

          What is the most terrifying is the possibly of World War III erupting in Europe with the insane policies being employed by the EU, NATO and, of course, America. Openly stating that the goal is to remove Putin and the pouring of American weapons into Ukraine is like pouring gasoline on a bonfire. And then there is China–if it moves against Taiwan, Japan will get dragged into the fight. Which means America will get dragged into the mess to protect Japan.

          Remember, WWII was started when a Bosnian Serb student assassinated a certain Archduke. The seeds of World War II were planted by insanity of the First World War. The rest is history. My point is that great calamities get their start in completely unpredictable ways. The liberals in the West promoting their sick sexual perversions, CRT and the rest of their Marxist ideas will be quickly forgotten if a REAL shooting war starts in Europe. The last World War left the developed world in shambles with the exception of America.

          This could all end up in the biggest disaster in history.

  34. Did the cryptokidz miss the memo that the Fed took away the punchbowl that fueled their Ponzi asset price appreciation?

    1. Bitcoin Bullish This Year? Popular Crypto Strategist Unveils BTC Outlook Based on Four-Year Cycle
      Daily Hodl Staff
      January 1, 2023

      A popular crypto analyst is weighing in on the potential gains of Bitcoin this year based on BTC’s four-year-cycle theory.

      Pseudonymous crypto strategist Rekt tells his 330,900 Twitter followers that he believes Bitcoin will likely bottom out this year according to the principles of the four-year cycle.
      …
      https://dailyhodl.com/2023/01/01/bitcoin-bullish-this-year-popular-crypto-strategist-unveils-btc-outlook-based-on-four-year-cycle/

      2. Four year cycle

        Crypto bros looked at the charts and concluded that the price of bitcoin would always dip right after a halving and then skyrocket soon after. That’s their cycle. Of course, they don’t account for crypto hype, foolish pension funds, fraudulent exchanges, stimmie chex, political contributions, money printing, or the simple fact that two iterations does not provide enough data to solve an equation with that many variables.

        But maybe Bitcoin will bottom out this year. And stay on the bottom.

    2. As I have said before, with all the chaos in the cryptoverse, I would expect “coin” prices to be in free fall.

  36. At last some happy news on housing, from one of my favorite cities.

    Perhaps now that the central bank engineered global housing bubble is finally deflating, there is cause for hope going forward.

    1. The Financial Times
      House & Home
      Lessons from Vienna: a housing success story 100 years in the making
      As world cities suffer from crippling rent rises, the Austrian capital’s radical housing policy is inspirational
      Vienna’s historic city square Michaelerplatz
      Kirsty Lang / Photographed by Julius Hirtzberger for the FT
      December 30 2022

      The most famous New Year concert in the world is performed in Vienna and beamed to millions across the world under the golden ceilings of the 19th-century Musikverein concert hall. Vienna is synonymous with classical music, having been home to Haydn, Mozart, Beethoven and Schubert. It’s also a city synonymous with coffee houses, a place where in the early 20th century artists, writers, philosophers and political radicals gathered — including Klimt, Zweig, Wittgenstein, Freud, Trotsky and, of course, Hitler. Later as the frontier city of the cold war, Vienna acquired a new infamy as the City of Spies.

      But there is another Vienna, a 21st- century version that most tourists don’t see. This contemporary version of Vienna is famous for its high quality of life and for consistently coming top of the Global Liveability Index.

      “Vienna is a city where you can choose what century you want to live in,” says the political scientist Ivan Krastev from the IWM institute, who has made his home in the Austrian capital for more than a decade. You can time travel (on foot) from the cobbled streets of the old medieval centre through late 19th-century Art Nouveau and Viennese Modernism and then jump on to the cheap, highly efficient public transport network to visit a building by Zaha Hadid (who got her first commission in Vienna in the 1990s) before admiring a 21st-century eco-housing development — all in the space of a couple of hours.

      According to the Economist Intelligence Unit, the liveability score of a city is calculated on several factors: healthcare, culture, environment, education, infrastructure and security. Vienna comes out top in nearly every category.
      …

      1. But there is another Vienna, a 21st- century version that most tourists don’t see. This contemporary version of Vienna is famous for its high quality of life and for consistently coming top of the Global Liveability Index.

        When I rode the tour bus in Vienna a few years ago, the tour guide bragged to us about all the subsidized housing, and that she lived in a gooberment owned flat. My first thought was that it works until you run out of other people’s money to spend. It also stops working when your city is flooded with non European immigrants.

        1. Well, there are some governments who spend more on their people than on war and corporations. I know Vienna, I know Austria, and they’ve been doing a pretty good job, both in health care and housing for almost a century now. You can qualify for housing after some time. It’s decent and nothing to be ashamed of, yet there is a very large portion of the population that simply wants more, bigger, and better, and they buy their own.

          Most of the immigrants and non locals(but also some locals) pay rent. Not so easy to find as in USA. You need to qualify for that “free” housing, and one of requirements is to be a citizen. And it’s not “free”, it’s just a lower and much more stable rent to the government that also adjusts it in times of financial difficulties, like loosing a job, etc. It’s negotiable depending on circumstances, but you can also get evicted if you play the system too much. I just haven’t heard of any, though.

          I’d say it’s quite a good balance of both worlds and quite a success story. And they haven’t run out of money just yet in this last 80 years, so it’s quite safe to assume they won’t run in the future either. But it takes a responsible government working for the people, and responsible people working with the government. They brag to be socialists, and quite proud of it. Sorry I had to mention it. It may not work in a lot of places, but it works fine there. People seam to be happy with what they have.

          Overall, it would be quite difficult for an American to understand it without having lived there for a decade. There are benefits and obligations, but everyone seems to follow the rules. Both, governments and citizens. I wouldn’t be sure that the system would work just as well in the States for a multitude of reasons that have been mentioned here many times, and it’s not for me to discuss.

          Sorry, for me Vienna is something special, and I will always be a bit subjective. My apologies. 🙂

          1. but everyone seems to follow the rule

            And will that be sustainable if the third world continues to flood Austria and Europe? Or if the US and NATO are no longer able to defend Austria?

    1. High mortgage rates, recession fears: Who actually wants to buy a house in 2023?
      Matt Levin 3 days ago
      Heard on:
      A residential real estate for sale sign in a front yard.
      “Overall annual sales next year will be lower,” said Lawrence Yun of the National Association of Realtors. Brendan Smialowski/AFP via Getty Images

      The housing market is ending 2022 on a pretty sour note. Pending home sales in November dipped to their second lowest level since the National Association of Realtors started tracking that stat 20 years ago.

      And though mortgage rates have dipped in recent weeks, they topped 7% last month and are still way above where they were last year. Add in further expected rate hikes from the Federal Reserve and the uncertainty around a possible recession next year, and you’ve got to ask: Who exactly is going to buy a house in 2023?

      To be clear, the housing market in Fresno, California, is not dead. But how’s the market now compared to last year when the influx of remote workers from the Bay Area was in full force?

      “I would say like the tortoise and the hare,” said Sabrina Brown, a local real estate broker. 

      Brown said she’s still getting some calls from certain types of buyers, like renters just fed up with renting and newlyweds looking to upsize. But she’s noticed a new type of seller: the formerly remote worker.
      …
      https://www.marketplace.org/2022/12/29/high-mortgage-rates-recession-fears-who-wants-to-buy-a-house-in-2023/amp/

      1. Writing the wrong year on the first batch of checks used to be a rite of passage for me. That has changed.

    3. TheHill.com
      Finance
      Most Americans couldn’t afford to buy their own home today: survey
      by Daniel de Visé – 12/29/22 6:00 AM ET
      House with for for sale sign in front with blurred background

      A homeowner’s refrain, oft-heard around the nation’s capital in recent years, has hardened into sobering fact: Most Americans couldn’t afford to buy their own home in today’s market. 

      Fifty-five percent of U.S. homeowners say they could not raise the funds to purchase their home at current prices and interest rates, according to findings from the 2022 Housing Affordability Survey by Cato Institute released this month.
      …
      https://thehill.com/policy/finance/3791139-most-americans-couldnt-afford-to-buy-their-own-home-today-survey/

      1. “Most Americans couldn’t afford to buy their own home today”

        We heard that alot back before the 2007-2012 CR8R formation event.

      2. Most Americans couldn’t afford to buy their own home today: survey

        Isn’t that kinda the point? We’re not expected to afford to re-buy all the stock in our retirement accounts, because the expectation is that the value would increase after we invested. Why should housing be any different?

        1. Housing is very different because it is a lumpy asset which most owners can only afford to purchase, in quantity of a single unit, with the assistance of a government guaranteed and subsidized leverage.

          What these people are saying is that recent home price appreciation plus interest rate increases have shifted the mortgage market in a manner to make it impossible for them to afford to purchase the same house they were qualified, willing and able to buy at some point in the recent past. The problem for anyone interested in selling their house is that would be buyers can’t afford it for the very same reasons. The only way out is for the owner to reduce the asking price to a level that reflects present market reality.

        2. Doesn’t that assume that everyone is climbing the “property ladder”?

          A lot of people can’t afford to buy the starter home live in now.

    4. Ideas
      You Should Probably Wait to Buy a Home
      Why the housing market is so brutal right now
      By Annie Lowrey
      An illustration of a yellow “For Sale” sign that reads: “Slow”
      Getty; The Atlantic
      November 30, 2022

      Should you even try to buy a house right now? Asking real-estate agents, economists, and potential homebuyers that question is likely to elicit something between a whimper and a scream these days. “It never feels like a great time to buy a house,” Danielle Hale, the chief economist at Realtor.com, told me. “You’re committing yourself to paying this enormous mortgage over a really long period of time.” But, she said, something that is always “a little bit scary” is “particularly scary” right now. Many Americans seem to share that sentiment: Half as many home sales occurred this past July as in the same month two years ago.
      …
      https://www.theatlantic.com/ideas/archive/2022/11/housing-market-when-to-buy-a-home-mortgage/672293/

      1. “It never feels like a great time to buy a house,”

        Try that’s an interesting alternative to the usual ‘there has never been a better time to buy’ you normally hear from the relitterz.

      2. ‘something that is always “a little bit scary” is “particularly scary” right now.’

        Boo-yah! Where do I sign the dotted line?

  38. How can the experts rank the present housing market correction as ‘second largest’ when it is just barely underway? Seems like a good time for patience in judgement, as the CR8R grows ever deeper. In five or so years, we should have a pretty good idea of how this one ranks in the historic pantheon of real estate busts.

    1. Real Estate
      Published December 30, 2022 9:24pm EST
      US suffering from the second biggest home price correction of the post-WWII era
      55% of Americans say they cannot afford to buy their home in today’s market, according to the CATO Institute 2022 Housing Affordability National Survey
      By Kayla Bailey FOXBusiness

      The U.S. housing market is experiencing its second-biggest home price correction of the post-World War II era.

      Macro Trends Advisors founding partner Mitch Roschelle attributed the massive correction to Americans’ uncertainty for the markets and their “uneasiness” regarding the economy. He explained on “Varney & Co.” Friday that the “shoe to drop” would be if the nation starts to see a rise in unemployment, which could cause a “leg down” in the housing market.

      “A couple of things are going to cause it to turn in the opposite direction, meaning home prices are going up. One is certainty. And when you don’t know if interest rates are going to go up or not. I think that is what is driving a lot of people away from buying because they just don’t know if rates are going to be cheaper in two months, and they’re just going to wait,” Roschelle explained to FOX Business’ Ashley Webster. 
      …
      https://www.foxbusiness.com/real-estate/us-suffering-second-biggest-home-price-correction-post-wwii-era

      1. “And when you don’t know if interest rates are going to go up or not.”

        Only a complete moron can’t tell by now which way rates are headed.

    2. If I were a betting man, I would bet the present housing bust will eclipse the 2007-2012 episode by the time it ends, especially with no propspect of Quantitative Easing on the horizon to reflate the bubble.

      1. The other thing to bear 🐻 in mind as we watch this housing correction play out is that the Fed has openly acknowledged that prices are too high… something we never heard in the run-up to the 2007-2012 housing price correction. If the Fed thinks prices have become unaffordable, don’t be surprised if they take corrective measures going forward.

        Don’t fight the Fed!

  39. ‘a regional sales manager for Stylecraft Builders, said the company started building fewer speculative homes when the fourth quarter of the year arrived. She said Stylecraft also began rationing sales when interest rates were at their lowest ‘because we were getting a lot of investors scooping up everything they could before homeowners could act’

    Here’s the thing Laurie: lots of builders sold hand over fist to speculators. Next door to yer shacks.

  40. ‘I don’t know if we’ll ever get back to how fast things were 12 to 18 months ago’

    That’s the spirit Keith!

    1. I don’t remember it ever being that fast before, not even in the early 90’s in SoCal, and back then it felt very fast.

  42. Predictions From Industry Leaders for 2023 – It doesn’t look good – The Canadian Real Estate Show
    Jan 1, 2023

    Darryl and TK discuss the Canadian Real Estate Market in depth from their own unique perspectives with a particular focus on The Toronto Real estate Market.

    https://www.youtube.com/watch?v=4ffPLtMsAKA

    2 hours.

  43. Are you concerned that a liquidity crisis could silently consume the global financial economy in 2023?

    1. ‘Silent killer’ liquidity crisis will stalk global financial system in 2023
      – Few people seem aware as a liquidity crisis offers few clearly visible symptoms until it begins to affect the internal organs of the financial system
      – It could be that the potential risks involved will not crystallise on a scale that threatens the financial system, but past crises offer little reassurance
      Anthony Rowley
      Published: 11:00pm, 31 Dec, 2022
      Updated: 11:00pm, 31 Dec, 2022
      Why you can trust SCMP
      …
      https://www.scmp.com/comment/opinion/article/3204796/silent-killer-liquidity-crisis-will-stalk-global-financial-system-2023

      1. The crisis is currently too much liquidity that fooked everything up. They are desperately trying to drain that liquidity to slow inflation, but not doing so well yet. Warning of a liquidity crisis at a time of record reverse repos and hordes of BTFD stock gamblers seems like warning of a flood during a raging wildfire.

        1. PS – All of the people warning of this impending doom are the ones getting crucified by Powell’s rate hikes. Coincidence? I think not.

          1. The Financial Times
            Markets
            Charts of the year: the big moments for gilts, crypto and the dollar
            Blow-ups and paradigm shifts defined a terrible year for fund managers
            A montage of a $100 bill and the logos for FTX and bitcoin
            Crypto’s cratering and the strength of the US dollar made headlines in 2022
            FT reporters December 31 2022

            For most investors, 2022 has been a year to forget. Crumbling equities were bad enough, but with bonds also suffering from a surge in inflation and an aggressive response from central banks, fund managers were often left with nowhere to hide. Flinty hedge funds able to bet on the dollar and against government debt are among the few celebrating a good year.

            It has also been a year pockmarked by truly extraordinary events, in areas as staid as UK government bonds and as wild as crypto. Here, Financial Times reporters have picked their markets charts of the year, encapsulating the biggest moments and most powerful trends.

            The bond market that turned

            Soaring inflation and a global dash higher in interest rates have spelt a miserable year for bond investors.

            The 16 per cent drop in the Bloomberg global aggregate bond index — a broad gauge of sovereign and corporate debt — is the worst performance in data stretching back to 1991, dwarfing all the other relatively rare annual downturns for fixed income over the past three decades.

            At the start of 2022, investors and central bankers were still clinging to the idea that runaway inflation could be tamed through relatively modest rises in interest rates. But the commodity price shock resulting from Russia’s invasion of Ukraine put paid to those hopes. Inflation continued to surprise on the upside for most of the year, even as central banks in the US, UK and eurozone embarked on one of the most rapid tightening cycles in history.

            The US 10-year Treasury yield — a benchmark for global fixed income — peaked at above 4.3 per cent in October, having started the year at around 1.5 per cent, helping to fuel a 20 per cent drop in global stocks. Yields have since fallen back to 3.9 per cent following signs that US inflation is slowing — the latest data covering November show a pullback to a relatively tame 7.1 per cent in the annual rate, down from a peak above 9 per cent earlier in the year. But investors will be looking for further confirmation that price pressures are easing in the US and elsewhere before calling the end of a brutal bond sell-off.
            Tommy Stubbington
            …

        2. I think the worry is about a sudden evaporation of liquidity…from flood to drought overnight…

    2. Bitcoin Will Go To Zero On Feb. 1, 2023. DXY Supercycle Begins!
      USDOLLARISKING
      22 hours ago
      BINANCE:BTCUSDT 16647.36 30.61 0.18% Bitcoin / TetherUS
      Happy new year for all the US dollar bulls out there!

      And for you hodl’ers who still refuses to sell and says that 2022 was a bad year…well 2023 said “hold my beer”!

      The US Dollar is about to embark on a once in a century supercycle bull run that will not see a peak until at least 2031. The reason I set that year is because:

      1. I fully anticipate that the Federal Reserve will resume rate hikes in the year 2023 and see full 1% rate hikes on a monthly basis all the way to at least Q1 of 2024. This will likely bring the terminal rate to the 15-20% by the time the rate hike is done and I do not see any reason for the Feds to lower interest rates until at least 2025 in order to cool the economy and actually bring inflation down. Personally, I anticipate that we will soon see a deflationary decade in which the price of goods and services fall by over 50% of current value.

      2. The Fed still has ways to go in trimming it’s $9T dollar balance sheet through quantative tightning. At the current rate of $90 billion per month, it won’t be until the year 2031 until the balance sheet is reduced to zero.

      3. Because of #1 and #2…the US dollar will become more and more scarce as it becomes more expensive to acquire capital and quantative tightning effectively remove currency of circulation, thus shrinking its supplies.

      Now to the discussion that you crypto bulls despise…why do I think that Bitcoin will go to zero by Feb. 1, 2023?
      …
      https://www.tradingview.com/chart/BTCUSDT/jynheecT-Bitcoin-Will-Go-To-Zero-On-Feb-1-2023-DXY-Supercycle-Begins/

  44. Amid rising mortgage rates, another cost increase looms for next year’s home buyers
    By LEW SICHELMAN
    Andrews McMeel Syndication
    January 01, 2023 5:30 AM
    A property for sale by Dawn N. Reid Broker/CEO of Gladiator Realty Group located in Cutler Bay, Florida, on Friday, March 4, 2022.
    Daniel A. Varela

    As if rising mortgage rates and high house prices aren’t enough, homebuyers in the new year are going to have to contend with higher fees to obtain their credit reports. In some instances, a credit report will cost 400% more in 2023 than it did in 2022. According to the National Consumer Reporting Association, the Fair Isaac Corporation — aka FICO — is raising its price less than 10% to a select group of about 46 lenders. The company is behind the FICO scores many lenders use to rate applicants’ ability to make their mortgage payments. Six lenders will pay about 200% more, and the rest will pay four times what they were.

    Lenders usually pay to run a credit check and obtain a score for every loan applicant, then collect the cost from those who pass muster at the closing table. In a memo to lenders, NCRA Executive Director Terry Clemans called the price hike “massive,” saying, “This is a paradigm shift in the pricing structure for credit scores.” He said that the change is being “dictated” by all three national credit bureaus — TransUnion, Equifax and Experian — and FICO.
    …
    Read more at: https://www.miamiherald.com/news/business/real-estate-news/article270359387.html#storylink=cpy

  45. Never mind that the last real estate bust took upwards of half a decade to reach the bottom of the CR8R. The experts assure us that this time is different, and a bottom will be reached by mid 2023.

    1. The Financial Times
      Hong Kong economy
      Hong Kong home sales drop to lowest level since 2008 financial crisis
      Housing market recovery is not expected until middle of this year despite border reopening with mainland China
      A new apartment building in Hong Kong
      Developers are preparing to launch more discounted residential projects to recover from lacklustre sales
      Chan Ho-him in Hong Kong yesterday

      Hong Kong home sales have fallen 40 per cent year-on-year to their lowest level since the 2008 global financial crisis, data from the local land registry and projections from real estate agencies have shown.

      The slump in one of the world’s priciest real estate markets is expected to only bottom out by mid-2023 and home prices could fall by up to another 10 per cent this year, analysts said.

      Last year “was the worst year since 2008 for Hong Kong residential”, said Praveen Choudhary, an equity analyst at Morgan Stanley specialising in the city’s real estate and conglomerates.
      …

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