It’s Robbing Ah Seng To Pay Ah Huat
A report from Mansion Global. “What goes up, must come down. That’s apparently the motto of the current U.S. housing market, which, after a wildly prosperous peak-pandemic run, is now seeing values plummet. Homeowners across the country have collectively lost $2.3 trillion in home value since the figure peaked in June 2022, according to Redfin. Nowhere have values dropped more than in San Francisco. There, the collective worth of the housing market fell 6.7%—or $37.3 billion—year over year in December to $517.5 billion, a larger drop in percentage terms than any other major U.S. metropolitan area, Redfin said.”
The Daily Hampshire Gazette. “Signs of a cooling real estate market continued to emerge in January, according to the Realtor Association of the Pioneer Valley, with home sales dropping by almost 50% compared to January 2022 in Hampshire County. ‘The Massachusetts single-family market finally hit that wall we’ve all been anticipating,’ stated Tim Warren, CEO of The Warren Group. ‘We’re starting to see that market correction,’ said Lori Beth Chase, president of the Realtor Association of the Pioneer Valley. Some of January’s statistics, such as a 23% drop in median sale prices compared to the same month last year in Franklin County, can be seen not only as a result of a relatively small sample size — 36 closed sales — but as part of this process, Chase said.”
The Palm Beach Post in Florida. “Realtor Steve Simpson believes Palm Beach County has flipped to a buyer’s market. ‘There’s no question about it,’ said Simpson, a Realtor with William Raveis Realty. ‘There are a lot of buyers out there, but they are sitting on their hands. They’re waiting for the dust to settle.’ Simpson said he’s seen high-end asking prices regularly reduced in recent months, including on his own listings. A home he listed near North Palm Beach that started at $1.5 million, went to $1.2 million and finally to $945,000. ‘At that price, it went under contract immediately, and there was another person who wanted it right after that,’ Simpson said. ‘If you get to the right price, you find the vein, and it sells.'”
Go Banking Rates on Texas. “The Austin housing market has actually cooled considerably since the height of the pandemic. Homes here are spending far more time on the market than they did this time last year, and home prices have dropped considerably since their 2022 peak. Caret Down: ‘Yes, housing prices in Austin have been consistently declining. Median home prices are 5.4 percent lower in January 2023 than they were in January 2022, per Redfin, and the current median of $530,000 is more than $100K less than it was in May 2022. In addition, 33.8 percent of homes sold in January experienced a price drop.”
Business Insider on Arizona. “In Phoenix, not only is investor appetite for properties falling drastically, but home prices are in freefall as well. Phoenix is one of the US cities with the largest decline in home prices. December’s $410,000 median sale price represented a 10.5% drop from the 2022 peak price of a typical home in the desert metropolis of 1.62 million people.”
From Summit Daily. “Decreased home prices. More housing inventory. Rising interest rates. Short-term rental regulations. According to a recent report by Dana Cottrell, a Summit County broker and spokesperson for the Colorado Association of Realtors, the price of a single-family home decreased in January by about 10% compared to the 2022 average — to a value of $1.85 million.”
“For homeowners using their property as a short-term rental, many have been locked into an interest rate closer to zero if they purchased those homes before inflation began to climb. As the county seeks to reduce the amount of short-term rental properties over the coming years with a new cap on licenses, Leah Canfield, a broker associate, said some of those homeowners may be reluctant to sell their property. ‘There are certain sellers saying ‘I have to hold onto my home,’ Canfield said.”
The Monterey Herald in California. “Monterey County’s housing market continues to be influenced by its tight inventory, holding its median home price at $849,500 in January up 11% from December but down 2% from a year ago. Existing, single-family home sales in Monterey County totaled 98 in January, down 15% from December and down 40% from January 2022. Inventory increased 4% from December, and jumped 38% from a year ago. Adam Pinterits, Monterey County Association of Realtors Government and Community Affairs Director, said that buyers have been looking for deals, are watching the market closely and expecting adjusted prices. Whereas sellers tend to cling to older data and still expect to get higher prices. Local realtors are helping buyers and sellers make transactions happen somewhere in the middle between these expectations.”
“In Santa Cruz County, the median single-family home cost $1,160,000 and sold in 35 days for 96% of the list price based on 62 sales in January. Median days on the market increased 50% and new listings fell 28% from a year ago. In San Benito County, the median single-family home cost $745,000 and sold in 29 days for 99% of the list price based on 22 sales in January.”
The Sacramento Bee in California. “The keynote speaker at the 2023 State of Downtown breakfast said he expected to find downtown Sacramento more blighted. ‘I expected to see more of it significantly overriding your downtown, but it actually is not as bad as some other places,’ said Brent Toderian, a city planner from Vancouver, British Columbia. Toderian said homeless in Sacramento is not as severe as in his city, though it is significant when coupled with drugs, violence and mental health needs.”
From Bloomberg. “Wells Fargo & Co. cut hundreds of jobs in its mortgage unit this week, adding to thousands of cuts last year, as the firm retreats from a business it once dominated. The latest reductions affected more than 500 employees, according to a person familiar with the matter. Wells Fargo announced a ‘new strategic direction’ for the business last month that includes exiting correspondent lending, a pivot that Chief Financial Officer Mike Santomassimo said last week is ‘largely done.’ The firm also said it will shrink the portfolio of loans it services. JPMorgan Chase & Co. eliminated hundreds of positions in its mortgage unit this month, on top of reductions last year.”
The Globe and Mail in Canada. “Some Toronto sellers are still looking for peak prices, says broker Andre Kutyan. In the luxury segment, many downsizers are holding firm. Mr. Kutyan was recently asked to evaluate a high-end property in the Bayview and York Mills area. ‘The meeting went very well until it came to my assessment of the value of the home,’ Mr. Kutyan says. ‘The meeting got cut short rather quickly.’ Mr. Kutyan’s conservative estimate was that the house should be listed below $7-million. The sellers listed with another agent for more than $8-million.”
“The benchmark price in the area has dropped about 12.2 per cent from the peak to about $3.744-million in January, Mr. Kutyan points out. Properties in that price range may sit for as long as one or two years if they are priced too high, which is a risky strategy in a downward market, in his opinion. ‘Frankly I see trouble north of seven [million].’ Mr. Kutyan says even buyers at the high end are influenced by the level of interest rates. If they are moving up from an existing property, the amount they are likely to fetch has fallen as well. ‘The value of the home they’re selling is coming down, plus higher rates, so it’s a one-two punch.'”
The New Zealand Herald. “The owners of a South Auckland home have been hit with a million-dollar loss after reselling their house just one year after buying it in a further sign of how far Auckland house prices continue to fall. The owners paid $2.3 million for the St George St home in Papatoetoe in December 2021 but yesterday resold it at auction for $1.305m. The Herald understands the grim sale is related to personal issues rather than pressure from the falling housing market. The Herald is unsure why the owners paid $2.3m for the house in 2021 when its council valuation was $1.425m at the time.”
“A real estate agent connected with the recent sale said they could not comment. The home’s most recent Barfoot & Thompson marketing material said it was a ‘winner takes all – urgent sale’ situation. ‘Our vendor’s circumstances dictate that this beautiful family home is now on the market and make no mistake it WILL sell on, or before, the Auction Day. Get in quick to make the most of the short auction campaign – this is a one-off opportunity to pick up a much-admired home,’ it stated.”
“It comes as Auckland’s median sales price hit $940,000 this month, down 21.7 per cent on the same time last year, according to the Real Estate Institute’s January report. Nationally, the median national sale price fell 13.3 per cent annually to $762,500 and decreased 9.3 per cent for New Zealand, excluding Auckland, to $679,000. Wellington, Auckland, Northland and Bay of Plenty had the largest drop in the median sale price, down 16.4 per cent, 21.7 per cent, 16.6 per cent and 18.8 per cent respectively. The Reinz House Price Index, designed as a more comprehensive measure of house values, also fell 13.9 per cent.”
The Bangkok Post. “New condo supply launched in central Bangkok this year should not be priced higher than existing inventory because a glut remains amid stagnant purchasing power, says a real estate consultancy. Artitaya Kasemlawan, head of residential sales projects at property consultant CBRE Thailand, said developers are set to launch new condo projects in downtown locations after freezing development during the pandemic. ‘While development costs are higher, developers that plan to launch new condo projects in downtown Bangkok may lower margins by setting more competitive prices because there’s a lot of unsold units with old prices remaining available,’ she said.”
The Independent. “In the wake of the debate in Parliament earlier this month on housing, Workers’ Party MP Jamus Lim (Sengkang GRC) posted about why the price of a home is too high, and how this affects Singaporeans’ retirement. He also made the point that reserves are tapped to fund larger housing grants, adding that ‘It’s robbing Ah Seng to pay Ah Huat.’ He raised the point that as flats get more expensive, this has an effect on Singaporeans’ retirement.”
“‘This stems from the fact that most Singaporeans use their CPF to pay for their HDB mortgages…The problem is that it now conflates two differing objectives: high prices mean higher returns for retirement (good), but it also means that it’s harder for couples starting out to get a roof over their heads without breaking the bank (bad),’ he wrote. ‘ Over time, inflated house prices mean higher grants to make up the difference. Where does this money come from? In part, from interest from our reserves. So on one hand, we’re propping up high land valuations—arguing that any other approach amounts to a raid in the reserves—but on the other, we’re tapping more on revenues, to fund the larger grants. It’s robbing Ah Seng to pay Ah Huat ”
This Post Has 88 Comments
Comments are closed.
𝗚𝗶𝗹𝗳𝗼𝗿𝗱, 𝗡𝗛 𝗛𝗼𝘂𝘀𝗶𝗻𝗴 𝗣𝗿𝗶𝗰𝗲𝘀 𝗖𝗿𝗮𝘁𝗲𝗿 𝟮𝟳% 𝗬𝗢𝗬 𝗔𝘀 𝗡𝗲𝘄 𝗘𝗻𝗴𝗹𝗮𝗻𝗱 𝗛𝗼𝘂𝘀𝗶𝗻𝗴 𝗠𝗮𝗿𝗸𝗲𝘁 𝗦𝘁𝗮𝗴𝗴𝗲𝗿𝘀 𝗢𝗻 𝗖𝗼𝗹𝗹𝗮𝗽𝘀𝗶𝗻𝗴 𝗗𝗲𝗺𝗮𝗻𝗱
https://www.movoto.com/gilford-nh/market-trends/
𝘈𝘴 𝘰𝘯𝘦 𝘕𝘦𝘸 𝘏𝘢𝘮𝘱𝘴𝘩𝘪𝘳𝘦 𝘣𝘳𝘰𝘬𝘦𝘳 𝘴𝘢𝘪𝘥, “𝘚𝘦𝘭𝘭𝘦𝘳𝘴 𝘢𝘳𝘦 𝘴𝘰 𝘣𝘳𝘰𝘬𝘦 𝘵𝘩𝘦𝘺 𝘥𝘰𝘯’𝘵 𝘩𝘢𝘷𝘦 𝘵𝘸𝘰 𝘥𝘪𝘮𝘦𝘴 𝘵𝘰 𝘳𝘶𝘣 𝘵𝘰𝘨𝘦𝘵𝘩𝘦𝘳. 𝘛𝘩𝘦𝘺 𝘫𝘶𝘴𝘵 𝘸𝘢𝘯𝘵 𝘰𝘶𝘵 𝘧𝘳𝘰𝘮 𝘶𝘯𝘥𝘦𝘳 𝘵𝘩𝘦𝘪𝘳 𝘮𝘰𝘳𝘵𝘨𝘢𝘨𝘦 𝘢𝘵 𝘢𝘯𝘺 𝘤𝘰𝘴𝘵.”
It’s like robbing Ah Spound to pay Ah Sol.
Someone had to say it.
‘A home he listed near North Palm Beach that started at $1.5 million, went to $1.2 million and finally to $945,000. ‘At that price, it went under contract immediately, and there was another person who wanted it right after that’
See the red hotness? A bidding war!
The mighty lion surrounded by hyena.
Christopher Walken – The Lion speech from “Pool Hall Junkies”
https://www.youtube.com/watch?v=4KB2xignE6c
A no reserve price Dutch auction is a surefire sales strategy, even when tulip prices are plummeting.
‘Caret Down: ‘Yes, housing prices in Austin have been consistently declining. Median home prices are 5.4 percent lower in January 2023 than they were in January 2022, per Redfin, and the current median of $530,000 is more than $100K less than it was in May 2022’
I couldn’t find in the article who this was, I suppose a UHS.
‘Some of January’s statistics, such as a 23% drop in median sale prices compared to the same month last year in Franklin County, can be seen not only as a result of a relatively small sample size — 36 closed sales — but as part of this process’
How did you lose yer shack?
It was part of the process.
“How did you lose yer shack?”
Gradually, then suddenly.
The Brandon regime just increased taxpayer exposure to the risk of default by low-income/low-IQ Democrat “homebuyers” who should never have been approved for home loans in the first place)
https://twitter.com/GRomePow/status/1628617046887120898?
‘The owners paid $2.3 million for the St George St home in Papatoetoe in December 2021 but yesterday resold it at auction for $1.305m. The Herald understands the grim sale is related to personal issues rather than pressure from the falling housing market. The Herald is unsure why the owners paid $2.3m for the house in 2021 when its council valuation was $1.425m at the time’
Oh please, anybody with a queen on their pesos knows you have to be in it to win it.
Now there’s a turn of a phrase!
Homeowners across the country have collectively lost $2.3 trillion in home value since the figure peaked in June 2022, according to Redfin.
It was only Yellen Bux.
‘Monterey County’s housing market continues to be influenced by its tight inventory, holding its median home price at $849,500 in January up 11% from December but down 2% from a year ago’
Another sh$thole rolls over YOY and wipes out the spring cray cray.
“Signs of a cooling real estate market continued to emerge in January, according to the Realtor Association of the Pioneer Valley, with home sales dropping by almost 50% compared to January 2022 in Hampshire County.
Is that a lot?
‘For homeowners using their property as a short-term rental, many have been locked into an interest rate closer to zero if they purchased those homes before inflation began to climb. As the county seeks to reduce the amount of short-term rental properties over the coming years with a new cap on licenses, Leah Canfield, a broker associate, said some of those homeowners may be reluctant to sell their property. ‘There are certain sellers saying ‘I have to hold onto my home’
That’s right toilet scrubbers, hold yer ground, don’t give it away.
“For homeowners using their property as a short-term rental, many have been locked into an interest rate closer to zero…”
“As the county seeks to reduce the amount of short-term rental properties over the coming years with a new cap on licenses, Leah Canfield, a broker associate, said some of those homeowners may be reluctant to sell their property.”
– First of all, no one, except banks via FFR gets to borrow at zero rates. Mortgage rates were as low as 2.5-3.0% before rates went up, as I recall.
– Second, STR SFH owners with a loan won’t have the income if STRs are reduced/eliminated. They’ll still have to sell, and in fact, that’s already starting.
– Just more Realtor psycho-babble. Almost as bad as the MSM propaganda.
That’s right toilet scrubbers
I was under the impression that AirBnB rentals charge a huge cleaning fee AND the renter is expected to scrub the toilets before they leave.
Do either actually bother scrubbing? 🤔
‘There are certain sellers saying ‘I have to hold onto my home,’ Canfield said.”
It’s not your home until the final mortgage check clears, sellers.
It’s never yours. It belongs to the county. They tax the land and improvements every year, and continue raising those taxes, until the end of time. If you don’t pay the taxes, they take the house away and sell it to somebody else. That’s some “ownership” alright.
While this is true to some extent especially in some states, it is more of a lien on services provided that you agree to when you buy in most states. Not all local governments are robbing people. For instance, I add up what private trash collection would cost if the city wasn’t providing it and it is more than what I pay yearly in city taxes. County is similar even without schools. In this state you also get lots of leeway to pay it. Generally around here the only people that get property taken are either deceased or disappeared. That said, I still hate getting the bill but I can easily see that I genuinely owe it. If you find that you can’t see it then it might be time to relocate.
For instance, I add up what private trash collection would cost if the city wasn’t providing it and it is more than what I pay yearly in city taxes.
Not sure where you live but garbage collection has absolutely zero to do with property taxes everywhere I have lived. It’s something that is billed from waste management – a private company.
Property taxes go towards schools and all county government operations, which does include road maintenance and such.
Not true in places I have lived in Florida;
i.e. Lake County, Orange County, Manatee County, Polk County, etc. Garbage handling is contracted by the county and assessed on the Property Tax Bill.
contracted by the county
My mom’s was contracted by the town (Erie County), it was a great benefit. For a few years, the town was actually making money on the Recycle credits. I don’t have it here, but the town subsidizes the electric. We own a river inlet.
The other comments to my original comment help to show why it is really important to choose your location carefully. There are places where the local municipalities will try to rob you (Poway, CA anyone?), and other places where you get a fair deal. Don’t let the mistakes of one region cloud your judgement of whether being properly landed is a good idea or not. I see that argument a lot about how you never own the house. If you play to win and do your research you will absolutely come out ahead but you have to buy right and this requires being in sync with the cycle and choosing the area carefully.
You could say that about everything. Your car, your bank account, your clothes, even your life. They make the rules and have the enforcement mechanism. When they want something of yours they simply take it. (See: civil asset forfeiture)
Nah, that’s just silly talk. Once I buy my private possessions such as clothing, my car, etc., I never have to pay taxes on it again.
“civil asset forfeiture”
See also: anybody with Colorado plates driving east through Kansas with weed, or driving west through Kansas with cash.
It’s enough of a racket that even the austere, above the fray, Washington Post reluctantly reported on it.
‘‘The meeting went very well until it came to my assessment of the value of the home,’ Mr. Kutyan says. ‘The meeting got cut short rather quickly.’
Andre is a well known election denying anti-death injection knuckle dragging far right stopped clock perma bear.
‘The benchmark price in the area has dropped about 12.2 per cent from the peak to about $3.744-million in January, Mr. Kutyan points out. …’The value of the home they’re selling is coming down, plus higher rates, so it’s a one-two punch’
I love a good one two punch in the mornin!
“It comes as Auckland’s median sales price hit $940,000 this month, down 21.7 per cent on the same time last year, according to the Real Estate Institute’s January report.
Few things are as heartwarming as watching the degenerate gamblers who “won” the pandemic-era shack bidding wars getting their heads handed to them.
Falling prices AND rising monthly payments. They can’t even say “Well, I’ll just ride this out, since I’m only paying 2.9% interest”.
Nope, they can’t unload the shack unless they bring a huge check to closing AND their monthly payment just keeps going up. What are they saying, that some people will need to spend their entire paycheck to service the mortgage?
“Homeowners across the country have collectively lost $2.3 trillion in home value since the figure peaked in June 2022, according to Redfin.”
Seems like we are in a historically good period to not own a home.
“Seems like we are in a historically good period to not own a home.”
– The cabal at the Fed have blown another asset bubble, the biggest of all time; The Everything Bubble. Housing is just one part of it.
– The ‘wealth effect’ cuts both ways. Asset bubbles always burst.
– This is the 3rd now in a little over 20 years. Anyone with 1/2 a brain would’ve learned to avoid this after the 1st one, if their intentions were good. We can now assume that bubble-nomics is in fact an intentional policy as a nefarious method of strip mining what’s left of the middle class. Just look at who got the lion’s share of the pandemic stimmy $.
– The Bank of evil.
– Historical reference: France: John Law and the Mississippi bubble.
– Heads on pikes comes to mind.
Heads on pikes comes to mind
It is seeming more and more like this is the only way to stop these maniacs.
Are you afraid the stock market faces another major leg down before it finally gets past its rate hike obsession?
4 minute read
February 23, 2023 4:02 AM PST
Last Updated 3 hours ago
More volatility, possible correction ahead for global stock markets: Reuters poll
By Hari Kishan
FILE PHOTO: A trader works on the trading floor at the New York Stock Exchange (NYSE) in New York City, U.S.
REUTERS/Andrew Kelly
BENGALURU, Feb 23 (Reuters) – Volatility in global stock markets is not yet over, as more investors reckon interest rates will likely stay higher for longer, according to a Reuters poll of equity analysts, a slight majority of whom expected a correction within three months.
Global stocks (.MIWD00000PUS) fell nearly 20% in 2022 and would have fared worse if it were not for a late-year rally on hopes falling inflation and weaker growth would force central banks to halt an historic rate-hiking run and swiftly start cutting within months.
However, sticky inflation, strong labour markets and resilient economic growth so far this year have dashed those rate cut expectations, sending bond yields and market interest rate pricing sharply higher.
article-prompt-devices
Stocks have rallied about 20% in recent months and some strategists say the market has gone too far.
“Valuations are stretched across equity markets after the rally year-to-date. The recovery in earnings would have to be quite strong to justify these levels, given that support from falling real rates should remain limited on the back of sticky inflation levels,” said Wolf von Rotberg, equity strategist at Bank J. Safra Sarasin.
…
https://www.reuters.com/markets/poll-global-stocks-correct-short-term-inflation-weighs-2023-02-23/
The stock market bubble is grotesquely large.
Yahoo
Business Insider
Reddit-loving day traders are making their chaotic presence felt again – and their risky behavior is fueling a stock rally that doesn’t look sustainable
Phil Rosen
Thu, February 23, 2023 at 5:21 AM PST·5 min read
Retail investors are reviving the meme-stock playbook of 2021 and ignoring the Fed.
Getty; Phil Rosen/Insider
– Bullish sentiment has returned in a big way among retail investors as they’ve started the year piling record amounts into stocks.
– Like the meme-stock boom of 2021, investors are picking risky, speculative assets, despite those being the biggest losers during last year’s rising-rate environment.
– Strategists warn that the enthusiasm may be ill-conceived, given the Fed has insisted more rate hikes are on the way.
Retail investors are partying like it’s 2021.
The everyday traders that powered the meme-stock frenzy of two years ago are back, rebuffing Fed Chair Jerome Powell’s hawkishness and helping push equities higher after a dismal 2022.
Retail investors have been spending a record $1.5 billion a day on stocks this year, according to Vanda Research, helping the S&P 500 climb nearly 5% year-to-date, and powering the Nasdaq 100 more than 11% higher.
While the bullishness matches the meme-stock frenzy of yesteryear, the macroeconomic picture couldn’t be more different.
…
https://www.yahoo.com/lifestyle/reddit-loving-retail-investors-making-100000330.html
MarketWatch.com
Opinion: The stock market’s rally was a head fake and the smart money now is with the bears
Published: Feb. 23, 2023 at 2:07 p.m. ET
By Lawrence G. McMillan
S&P 500’s support is at 3900, then 3760 — the December 2022 low, writes Lawrence McMillan
The stock market, as measured by the S&P 500 Index SPX , has fallen below the 4100 level. That is significant because there previously was triple resistance at that level, and when SPX broke out above that level in late January, it seemed as if the next leg of the “new” bull market was underway.
Yet SPX has not only fallen below that supposed support level, it’s confirmed the pullback by trading all the way down to 4000. It appears that breakout above 4100 was a false one. Those are dangerous in bear markets (we last saw one in January 2022).
So, now there is resistance at 4200 (the early February highs), and while there might be some small support levels just below current levels, the major support is at 3900, and then 3760-3850. If SPX falls below 3760 (the December low) that would be an extremely negative development.
…
Yahoo
Fortune
‘Goldilocks’ is dead, warns Morgan Stanley Wealth Management. The risk of an economic ‘hard landing’ is growing even if the ‘pain may be delayed’
Will Daniel
Tue, February 21, 2023 at 1:58 PM PST·3 min read
Throughout January, the stock market soared as investors began to price in a “soft landing” for the economy—predicting the Federal Reserve would be able to tame inflation without sparking a recession. But Lisa Shalett, Morgan Stanley Wealth Management’s chief investment officer, warned Tuesday that “looking through the fog” to a new bull market is a bad idea.
After the U.S. economy added more than half a million jobs last month, pushing the unemployment rate to a 53-year low of 3.4%, and retail sales jumped 3%, surpassing economists’ expectations, Shalett fears the Fed will have to keep interest rates “higher for longer” to cool the economy and quash inflation.
“With consumption and inflation reheating, risks of a hard landing resembling a boom/bust are growing, even if the pain may be delayed a quarter or two,” she warned in a Tuesday note.
Recent strength in consumer spending and the labor market, along with better than expected corporate earnings, has led many investors to believe stocks are headed for a “Goldilocks scenario”—in which the economy is not too hot or too cold and where valuations remain high. But Shalett said that will only work if inflation continues to decline. And the latest consumer price index (CPI) and producer price index (PPI) data no longer show “speedily declining inflation,” according to the CIO.
Although year-over-year CPI inflation fell from its June 40-year high of 9.1% to 6.4% in January, it still remains well above the Fed’s 2% target rate. And PPI inflation—which measures changes in wholesale prices for businesses—came in at 6% last month as well, illustrating price increases may be here to stay.
Shalett warned that this data means Fed officials will “face even more pressure to cool demand” with interest rate hikes throughout 2023, noting that consumers’ inflation expectations have risen this month as well. Economists carefully monitor inflation expectations for signs that rising prices have become entrenched in consumers’ psyche, which makes them more difficult to fight.
That means investors betting on a “Fed put”—or a swift return to low interest rates as inflation cools—are “apt to be wrong this time,” Shalett said.
“We caution that recent gains look extremely fragile,” she added. “Fed credibility is on the line, and it is likely to risk overshooting rather than quitting the inflation fight too early.”
…
https://finance.yahoo.com/news/goldilocks-dead-warns-morgan-stanley-215826766.html
If you run afoul of our globalist overlords, you can expect a “jury of your peers” to deliver Kangaroo Court “justice.”
REVEALED: Georgia grand jury forewoman who said it would have been ‘awesome’ to subpoena Trump is a ‘WITCH’ who shares spells and magic on wacky Pinterest page
https://www.dailymail.co.uk/news/article-11782985/Georgia-grand-jury-forewoman-wanted-subpoena-Trump-witchy-Pinterest-page.html
No credit to Jack Posobiec?
Did Quantitative Easing break the electronic printing press?
The Financial Times
European Central Bank
ECB scraps dividend after rising interest rates wipe out profits
Eurozone central bank risks losses in the coming years as it unwinds quantitative easing policies
The euro sign
Losses at the ECB and other central banks are likely to reignite the debate about aggressive monetary easing
Martin Arnold in Frankfurt 2 hours ago
The European Central Bank made no profits for the first time in 15 years in 2022 after suffering writedowns on its bond investments, with analysts predicting years of losses following the reversal of its ultra-loose monetary policies.
The ECB said on Thursday it would have made an annual loss of more than €1.6bn if it had not drawn on the provisions it has built up in recent years to cover financial risks, adding it would scrap the dividend it usually pays to eurozone national monetary authorities.
Those dividends — amounting to €5.8bn since 2018 — are usually passed on by the national central banks to eurozone governments. Some national central banks, including those in the Netherlands and Belgium, have warned their governments that they expect to make significant losses.
…
This situation reminds me of what my professor told us in the first lecture of an undergraduate economics course:
“There is no such thing as a free lunch.”
Losses at the ECB and other central banks are likely to reignite the debate about aggressive monetary easing
Don’t worry, the people who caused all the problems are in charge of the solutions, too.
City Journal
The Fed Goes Underwater
Losses amid fiscal austerity will put the central bank in a political bind.
Judge Glock
Winter 2023
Before new trillion-dollar federal spending bonanzas became a regular occurrence, the Federal Reserve’s announcement that it lost over $700 billion might have garnered a few headlines. Yet the loss met with silence. Few Americans have noticed the huge increase in both the scale and the scope of the central bank or the dangers that it poses to the American economy. As Fed-driven inflation becomes the Number One political issue in America, that will change.
The Fed’s losses owe to a shift in the way it does business. Before the 2008 financial meltdown, the central bank tried to control interest rates by buying and selling U.S. bonds. A few billion in purchases or sales could move the whole economy, and this meant that the Fed, which operates much like a normal bank, could keep a relatively small balance sheet of under $1 trillion.
Since the financial crisis, the Federal Reserve, like other developed-world central banks, has used a different playbook. It provides enough funds to satiate the entire banking world, and it seeks to adjust the economy by paying banks more or less interest to hold those funds. These payments keep private-sector interest rates from dropping too low. When it first undertook this “floor” experiment, the Fed’s balance sheet exploded to more than $4 trillion. After the Covid pandemic, it approached $9 trillion.
A larger balance sheet means greater risks. And the Fed has added to that risk by purchasing longer-duration assets. Pre–financial crisis, the Fed bought mainly short-term federal debt. Only about 10 percent of all the U.S. bonds owned by the central bank lasted longer than ten years. Now, that figure has risen to 25 percent.
Moreover, starting in 2008, Fed banks began buying mortgage-backed securities, mainly from Fannie Mae and Freddie Mac. The Fed now holds more than $2.5 trillion of such mortgage bonds, and almost all those mature in over ten years. Today, nearly half the Fed’s assets won’t come due for another decade.
Such longer-term debt poses a particular danger. As the Fed pushes up interest rates, the old, low-interest debt that the central bank purchased loses value, leading to those hundreds of billions in losses. Economists Alex Pollack and Paul Kupiec warn that true Fed losses are over $1 trillion and will increase as interest rates keep rising.
The Fed is not just losing value on its old assets; it has started paying out more money than it takes in, every day. The interest rate that the Fed pays to banks in its new “floor” system has risen to over 4 percent, but its older mortgage and Treasury securities earn only about 2.3 percent. The longer the high inflation and high rates continue, the more the Fed will lose.
…
https://www.city-journal.org/fed-goes-underwater
“Such longer-term debt poses a particular danger. As the Fed pushes up interest rates, the old, low-interest debt that the central bank purchased loses value, leading to those hundreds of billions in losses. Economists Alex Pollack and Paul Kupiec warn that true Fed losses are over $1 trillion and will increase as interest rates keep rising.”
Making Millennial day traders, relitters and real estate investors get rich is bloody expensive!
Indeed.
A reader sent these in:
10 year yield heading back to 4%. There goes any housing momentum as this will push mortgage rates back up. The bond market is not happy with last week’s inflation data.
https://twitter.com/StealthQE4/status/1628050676403011585
To all the real estate morons, your house price only went parabolic because the federal reserve manipulated rates for 40 years from 18% to 2.7%.
https://twitter.com/GRomePow/status/1628039232567803904
Danielle DiMartino Booth
Perhaps the most salient chart I’ve seen all day.
https://twitter.com/DiMartinoBooth/status/1628215437522616321
Danielle DiMartino Booth
We’ll get there. Demographics not nearly as favors as they were after the last housing bubble burst.
Quote Tweet
The median existing home sale price is down 13% from its peak. After the last housing bubble top, prices fell 33%. The same decline today would only bring prices back to Feb ’20 levels, a reflection of the mania in the last phase of the current bubble: a 40% increase in 2 years.
https://twitter.com/DiMartinoBooth/status/1628108901458509860
‘The sharp rally this year has left stocks the most expensive since 2007 by the measure of equity risk premium, which has entered a level MS strategists call the “death zone.”
https://twitter.com/jessefelder/status/1628036848173060102
Housing starts outpaced household formation over the last 5 years. It’s a sharp contrast to the deficit that emerged a decade ago.
https://twitter.com/JeffWeniger/status/1628082622768246784
Buyers are scarce, market is frozen.
Active listings (total listed inventory minus properties with pending sales) jumped by 65% from a year ago, to 626,000 properties in January ⚠️
https://twitter.com/WallStreetSilv/status/1628288485802082306
Everything is fine … 🔥 🔥 🔥 Housing market coming to a halt … but don’t look at that. There is no recession. 🤨
https://twitter.com/WallStreetSilv/status/1628178570005684224
“With complaints continuing, Roseville City Council halts licensing of new short-term rentals”
https://twitter.com/JohnWake/status/1628266989864222720
Hot off the press “Completely sold out luxury condo collapses in Welland” 👇
https://twitter.com/ShaziGoalie/status/1628218704461721601
Conflict of interest? For money managers, yes. Therefore the Fed must continue to tighten, even though housing prices area already rolling over for the first time since the GFC. They ALL believe the Fed is invincible.
https://twitter.com/SuburbanDrone/status/1628234567436980224
lol. BC’s housing minister said rising interest rates are impacting housing affordability, at a time when home prices are coming down. bruh. Home prices are coming down because of interest rates—not because you did nothing, and they magically fell.
https://twitter.com/StephenPunwasi/status/1628035493676843011
MORTGAGE APPLICATIONS COLLAPSE LOWER THAN GREAT FINANCIAL CRISIS LEVELS
https://twitter.com/DonMiami3/status/1628394486886813697
Lance Lambert
The seasonally adjusted Mortgage Purchase Application Index falls 18.1% to 147.1. That’s the lowest purchase apps reading of the 21st century. On a year-over-year basis, total purchase apps are down 41.5%.
https://twitter.com/NewsLambert/status/1628363986575183873
The Kobeissi Letter
Home Depot, $HD, just confirmed that we are nearing a recession. They warned that a weak housing market and high inflation has hurt demand. Housing market is falling, basic necessities are very expensive and credit card debt is near $1 trillion. Consumers are feeling the pain.
https://twitter.com/KobeissiLetter/status/1628032482539888640
The Kobeissi Letter
If you missed this 200+ point drop in markets you ignored a key sign: The bond market. Bonds are falling like inflation is at 10% and the 10 year note yield is about to break 4%. Bond markets have been flashing warning signs for 3 weeks.
https://twitter.com/KobeissiLetter/status/1628126178560118793
The Kobeissi Letter
Minneapolis Fed President Kashkari: “We need inflation down to 2%. Is it going to take 2 years or longer? I’m not sure.”
The Fed now expects inflation to 2% by 2025.
That would mean 45 straight MONTHS of 2%+ inflation.
Just a year ago, the Fed said inflation is “transitory.”
Do not get caught up in the noise.
https://twitter.com/KobeissiLetter/status/1627673938590416900
THE BANK OF JAPAN HAS ANNOUNCED AN EMERGENCY BOND-BUYING OPERATION.
https://twitter.com/financialjuice/status/1628200862043496448
“If ever you find yourself beginning to doubt that problems in the economy related to housing are not well contained…soon enough a Federal Reserve official or the US Treasury Secretary will remind you that housing problems are indeed “well contained.””
https://twitter.com/RudyHavenstein/status/1628129259800920064
“I’d like to make an appeal to everybody who does not need to sell to take your home off the market.” Marianne Zoll of the Re/Max 5 Star/Zoll Real Estate & Auction Team (April 2007)
https://twitter.com/RudyHavenstein/status/1628127720029945856
New Century Financial Corp never once reported a quarterly loss before filing for bankruptcy in 2007.
https://twitter.com/RudyHavenstein/status/468097953131794432
Danielle DiMartino Booth
Stupid question but at some point, will @WellsFargo run out of employees in its mortgage division?
https://twitter.com/DiMartinoBooth/status/1628546968493465600
Danielle DiMartino Booth
Round Two continues “@Meta preparing for fresh round of job cuts, deputizing human resources, lawyers, financial experts & top executives to draw up plans to deflate company hierarchy, in reorganization & downsizing effort that could affect thousands of workers.”
https://twitter.com/DiMartinoBooth/status/1628420762607538180
The Fed staff doesn’t see inflation moving back to 2% until 2025: BBG
That’s one way to raise the inflation target
https://twitter.com/zerohedge/status/1628474694725771264
Uh oh. A Pimco-owned office landlord just defaulted on $1.7B of commercial mortgage notes.
https://twitter.com/Mayhem4Markets/status/1628549440494530564
If the “smart” bond guys had floating rate debt what does that say about the rest of the market?
https://twitter.com/CXCarroll/status/1628544484819578880
7 of the 10 cities in the S&P/Case-Shiller 10-City Home Price Index are off double-digits from their respective highs, using Redfin. Hard to see how this is not a 2023 recession when this important asset, the one the system is built on, is losing value like this.
https://twitter.com/JeffWeniger/status/1628528812538609664
CarDealershipGuy
A new Ram 1500 is now selling for $63,363. Wild!
Ram’s total sales dropped ⬇️ by 14.5% in Q4:
Its lowest sales for the quarter in over *6 years*.
Might be some truck deals on the horizon.
https://twitter.com/GuyDealership/status/1628451651093778432
“To all the real estate morons, your house price only went parabolic because the federal reserve manipulated rates for 40 years from 18% to 2.7%.”
What next: 40 years of real estate losses as interest rates gradually revert to historic norms?
Home Depot, $HD, just confirmed that we are nearing a recession.
But, but, but unemployment is low!
So everyone who wants a job, has a job. Problem is, they can’t make ends meet.
I haven’t been through a drive through for a while, but the last time I did, there was no line. There’s a deli I sometimes go to. There is never a line.
The US Housing Recession Is The Canary In The Coal Mine
https://www.zerohedge.com/markets/us-housing-recession-canary-coal-mine
Zeroguts goes out on a limb again.
That guy still begs me to comment. I throw him a nickel by commenting on his chitter posts.
“MORTGAGE APPLICATIONS COLLAPSE LOWER THAN GREAT FINANCIAL CRISIS LEVELS”
It will take a while for the lagged effect on housing prices to show up in the data.
I will own nothing
You sir are correct.
𝗖𝗼𝗻𝘄𝗮𝘆, 𝗡𝗛 𝗛𝗼𝘂𝘀𝗶𝗻𝗴 𝗣𝗿𝗶𝗰𝗲𝘀 𝗖𝗿𝗮𝘁𝗲𝗿 𝟮𝟵% 𝗬𝗢𝗬 𝗢𝗻 𝗕𝗶𝗹𝗹𝗼𝘄𝗶𝗻𝗴 𝗘𝘅𝗰𝗲𝘀𝘀, 𝗘𝗺𝗽𝘁𝘆 𝗔𝗻𝗱 𝗗𝗲𝗳𝗮𝘂𝗹𝘁𝗲𝗱 𝗛𝗼𝘂𝘀𝗶𝗻𝗴 𝗜𝗻𝘃𝗲𝗻𝘁𝗼𝗿𝘆 𝗔𝘀 𝗟𝗮𝗻𝗱 𝗣𝗿𝗶𝗰𝗲𝘀 𝗣𝗹𝘂𝗺𝗺𝗲𝘁 𝗔𝗰𝗿𝗼𝘀𝘀 𝗡𝗲𝘄 𝗘𝗻𝗴𝗹𝗮𝗻𝗱
https://www.movoto.com/conway-nh/market-trends/
𝘈𝘴 𝘰𝘯𝘦 𝘯𝘢𝘵𝘪𝘰𝘯𝘢𝘭 𝘭𝘢𝘯𝘥 𝘣𝘳𝘰𝘬𝘦𝘳 𝘦𝘹𝘱𝘭𝘢𝘪𝘯𝘦𝘥, “𝘐𝘧 𝘺𝘰𝘶 𝘱𝘢𝘪𝘥 𝘮𝘰𝘳𝘦 𝘵𝘩𝘢𝘯 $500 𝘢𝘯 𝘢𝘤𝘳𝘦, 𝘺𝘰𝘶 𝘨𝘰𝘵 𝘳𝘪𝘱𝘱𝘦𝘥 𝘰𝘧𝘧.”
Lock him up:
“The new charging document lays out in greater detail Bankman-Fried’s allegedly fradulent conduct related to his cryptocurrency company and an associated hedge fund.
The 12-count indictment also provides new details of political donations that Bankman-Fried allegedly directed in violation of federal campaign finance laws.
The document lays out how Bankman-Fried allegedly operated an illegal straw donor scheme as he moved to use customers funds to run a $40 million political influence campaign.
The indictment claims that Bankman-Fried and his co-conspirators “made over 300 political contributions, totaling tens of millions of dollars, that were unlawful because they were made in the name of a straw donor or paid for with corporate funds.”
https://www.cnbc.com/2023/02/23/ftx-founder-sam-bankman-fried-hit-with-new-criminal-charges.html
I wonder why they are throwing him under the bus now? He was for all practical purposes off the radar.
Because you can’t levitate a Ponzi forever. That’s why. Once it collapses, there has to be a fall guy. Who else would they choose?
“Who else would they choose?”
Maybe those who willingly invested in it without conducting due diligence?
Looks like a “suicide” is in the cards.
I was thinking maybe the white collar criminal’s Lompoc Federal Penitentiary.
Somebody at the Fed must have adjusted the dow divisor and they’re metering in the adjustment over a series of trading days. Why do I believe this? Becasue the Dow…….
It’s cratering.🤣🤣🤣
Becasue the Dow…….
It’s cratering.
Looks to be up over 100 points.
As long as housing prices continue cratering, all is well.
Boulder, CO Housing Prices Crater 24% YOY As Denver Area Sellers Beg For Offer
https://www.movoto.com/co/80301/market-trends/
A Poll on Biden claims only 19 % support for his policies. That probably in truth means only 10% support.
Seriously , I think they are are gearing up for another Panademic in 2024 , so its easier to rig the election.
This time 194 Countries by treaty agreement transferred power to the WHO to dictate what the response will be to the next Pandemic. . Joe Biden signed this without approval of Congress/ Senate.
This so called Treaty with the United Nation WHO, is how the enemy plans on
over riding the US Constitution , Bill of Rights,State Rights, etc. The corrupt WHO
is a puppet for China, WEF and Bill Gates donates millions to WHO.
Tedros, ,who is head of WHO, is a known Commie thug.
That Biden is a traitor, sneaking around trying to sell out our rights by Treaty.
Will Biden be able to over ride the Constitution ,,without 75% by Senate vote and High Court approval .You know we have a fake government because they aren’t addressing this issue now before they launch the next fear mongering Pandemic.
The WHO would have the right by Treaty to lockdown the globe, mask people, impose fines or impose prison, take people to camps, mandate fake vaccines,declare police state or marshal law. In WHO amended rules, they claim they don’t recognize human rights in the health measures they have to take.
Im just saying that the One World Order has to have the medical tyranny to pull off the Great Reset , and they want the UN and the WHO to dictate , so all rights are taken.
Just saying….
22 proved that they don’t need a new pandemic to rig the election. Rigging has been the norm for a while.
FWIW, 2/3 of the Senate has to approve a treaty, per Article II, Section 2 of the Constitution.
Of course that doesn’t mean that the Anti-President won’t try to grant the WHO authority via an executive order. The SC might have something to say about that. Of course by 2024 who knows what the republic will be like. Will we still have a Supreme Court? Will the lights still be on? Heck, I’m not sure we’re gonna make it to December.
Ok, so I thought it had to be 75% approval but 2/3 is more than normal.
I just can’t see that a fake President can supersede the Constitution by executive order. .
Like a lot of actions by this enemy , they just break the law, do the damage and wait to be called on it.
I’m just saying we aren’t out of the woods yet in terms of medical tyranny, so Im looking way ahead. You can almost predict what they are going to do or try.
With news being so fake, they could fake anything.
The conquences of a rigged election have been enormous so far .
I’m just saying we aren’t out of the woods yet in terms of medical tyranny, so Im looking way ahead.
I think the next step will be climate lockdowns. The so called 15 minute city is an example of this. Oxford, England is going to be the prototype. When the locals protested, Antifa, the WEF’s brownshirts, magically showed up and harangued them. Anyway, the plan is that only “the people who matter” will be allowed to travel.
Religious persecution is also coming. The Sedevacantists in the US were in the FBI’s crosshairs, because they are “extremists”, until it was leaked. In related news an auxiliary Bishop in Los Angeles was shot and killed recently. Barely made the news.
Sedevacantists
Sounds like the seat is vacant. Division of what is One and Universal is always ironic. A threat to the country? Hardly.
The Sedevacantists are statistically insignificant, yet for some reason the FBI has chosen to target them. From what I read, the FBI claims that there are “white supremacist” issues with them, which strikes me as odd as they are spread world wide and have members of all races. I wonder if they are “target practice” for the FBI. Anyway, since the leak the FBI has backpedaled, claiming that they do not have groups like the Society of St. Pius X under surveillance. Just what they are hoping to find eludes me: that they have potlucks?
I’ve read opinions that busting a non-woke group is important on an FBI resume for career advancement.
I had a friend that left an engineering job 40 years ago to work for the FBI. Never heard from him again. Probably a good thing.
Division of what is One and Universal is always ironic
Curiously, they do not consider themselves to be in schism. The Vatican did announce some years ago that the SSPX Sacraments are valid and not illicit for Catholics, which would seem to indicate that the aren’t quite in schism.
The whole Latin Mass drama perplexes me. Francis isn’t fond of it and considers its practice to be divisive. But eastern rite Catholics can use their own liturgies, which are nearly identical to those used by the Orthodox Church and bear little resemblance to the Novus Ordo Mass.
I’ve read opinions that busting a non-woke group is important on an FBI resume for career advancement.
That would make a lot of sense and make the SSPX a shiny target.
Though if you want to go after a non woke church, I think the Orthodox would make an easier target. I wouldn’t expect to find any “BIPOCs” at a Russian or Serbian Orthodox parish. Catholic parishes tend to have a lot of Hispanics these days.
I think the next step will be climate lockdowns.
That is a widespread concern and where I would be expecting the next power grab to start.
Just read that produce is being rationed in the UK:
At least the Wuhan flu isn’t to blame.
“California bill would eventually ban all tobacco sales for anyone born after Jan. 1, 2007”
Hehe, the golden state.
https://www.cbsnews.com/sacramento/news/california-bill-tobacco-sales-next-generation-ban-jan-1-2007/
But weed is OK
Yeah, funny, but true!
Does it seem like there have been a lot of recent layoff announcements, given that the economy is perpetual red hotcakes?
The Financial Times
Accounting & Consulting services
Consultants start to cut jobs as boom time ends
McKinsey and KPMG first to move as clients reduce costs and battle inflation
KPMG and McKinsey logos, and the Manhattan skyline
KPMG is cutting nearly 700 jobs in its US advisory business and about 200 in Australia, while McKinsey will make up to 2,000 people redundant as part of a global restructuring
Michael O’Dwyer and Owen Walker in London 3 hours ago
Job cuts at McKinsey and KPMG this month are the first concrete sign that a boom in spending on consultants that started during the pandemic might be over, as clients move to reduce costs and battle inflation.
Companies short on staff and desperate to make their operations digital after the pandemic paid record amounts to consultants in the past two years. Demand for advice on tech, dealmaking and implementing net zero pledges fuelled a boom in consultants’ profits and ignited a pay and recruitment war.
But soaring costs, the end of near-free borrowing for clients and a slump in deal activity have led to a more difficult outlook for parts of the big consultancies’ businesses — and spurred the first significant cuts in the sector, following the announcement of big lay-offs at large companies such as Meta and Goldman Sachs.
…