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The Golden Era Of Low Mortgage Rates Has Come To An End

A report from Bloomberg. “Starwood Capital Group, led by Barry Sternlicht, is exploring a sale of more than 2,000 single-family rental homes. SREIT owned 3,210 single-family rental homes valued at $1.26 billion as of March 31, according to a filing. It recognized a nearly $80 million impairment charge on various single-family rental properties during the first quarter on revised cash-flow assumptions ‘due to an increased probability of a near-term disposition,’ the trust reported. Starwood also owns rental houses outside of SREIT. Starwood’s Sternlicht has said the Fed’s campaign to hike rates is ‘bordering on idiotic.'”

The New York Post. “Eight years after first listing his Fifth Avenue duplex, celebrity hair stylist Frédéric Fekkai has finally sold it for $4.5 million — far less than its original asking price of $12 million. He bought the home for $7.4 million in 2006.”

WVUE in Louisiana. “Rising property insurance costs are causing some homeowners in the New Orleans area to make concessions when selling their homes this spring. ‘They will lessen the price of the house or they will have the roof replaced before closing,’ said Liz Tardo, president of the New Orleans Metropolitan Association of Realtors (NOMAR). ‘We’re seeing a lot of that.'”

From Market Place. “ATTOM Data Solutions, a cruncher of national real estate facts and figures, reports that foreclosure activity has been rising this year and spiked sharply in May. It was up 7% from April and 14% over a year ago. Vivek Sah at the University of Denver thinks the recent spike in foreclosure activity may be due to house flippers. They may now be stuck with improved properties they can’t sell at improved prices, he said — so some of them may just be walking away.”

The Scottsdale Progress in Arizona. “Valley home buyers and sellers may be facing a long and not-so-hot summer, according to a leading analyst of the Maricopa and Pinal counties’ market. ‘With supply and demand both dropping, volume is likely to be weak between June and September,’ the Cromford Report said. ‘It is currently a contest between sellers and buyers for who loses motivation fastest.’ It also warned again against believing any predictions of a massive wave of foreclosures, calling people who believe that ‘deluded by fabricated data that exists only in their own mind.'”

“‘All the real world data says that delinquency rates remain below normal, that pre-foreclosure activity is unusually low and that the rate of actual foreclosures taking place is extremely weak, even though most of the forbearance that was introduced during the pandemic has ceased,’ it said. Last week there were only 993 foreclosures pending in Maricopa County.”

From Nerd Wallet. “Metro areas in California have historically been the least affordable in the nation. This most recent quarter had some familiar faces among the costliest: Los Angeles, where homes were listed at 11.1 times the typical first-time buyer income, San Diego (9.6) and San Jose (8.7). These were joined by Miami (8.6) and New York City (7.3). This is the first time in this analysis that the NYC metro area was among the five least affordable locations.”

From House Digest. “According to Realtor.com, homes sold in May 2023 were priced lower than they had been in May 2022. While nationally, prices are falling, there are a few areas that are seeing more of a decline than others. Boise, Idaho, and Austin, Texas, which saw some of the fastest rising prices during the pandemic, are currently ranked first and second, respectively, where home prices are falling in 2023, per Realtor.com. Boise, Idaho, has a median list price of $609,875, which is a 7.8% decline in price per square foot from 2022 to 2023. Austin, Texas, is right behind with a median list price of $583,751 and a 7.7% decline in price per square foot over the last year.”

“Rounding out the top three is Myrtle Beach, South Carolina, with a median list price of $366,075 with a 7.3% decrease in price per square foot. The rest of the top ten, in descending order, are Phoenix, Arizona (median list price of $529,450, 5.6% decrease). Sarasota, Florida (median list price of $549,900, 4.7% decrease). Salt Lake City, Utah (median list price of $635,000, 4% decrease). Pittsburgh, Pennsylvania (median list price $238,250, 3.9% decrease). Winston-Salem, North Carolina (median list price $345,899, 3.6% decrease). Sacramento, California (median list price $662,875, 3.4% decrease). Chicago, Illinois (median list price $376,00, 1.1% decrease).”

Fox News on California. “City council members in San Diego are considering a proposal to ban homeless encampments from public property amid years-long frustration over the city’s mounting homelessness crisis. The plan has received support from San Diego Mayor Todd Gloria. ‘This park, like all of our parks, are not a homeless shelter. It’s not a place to live, it’s not a giant toilet, it is not a trash dump,’ Gloria said at a press conference in Balboa Park on Friday.”

The Boston Globe on Rhode Island. “If the state’s two largest projects fail — the long-vacant Superman building in downtown Providence, and the Tidewater soccer stadium in Pawtucket — then Senator Sheldon Whitehouse said he could foresee more major development projects falling apart. ‘If the Superman building deal falls apart because of interest rates and supply chain problems, and if the soccer stadium in Pawtucket also falls apart, then I think that’s going to be tough for both cities,’ Whitehouse said Monday morning during the Greater Providence Chamber of Commerce’s annual congressional breakfast. ‘And I think it signals where other projects might go when the financing and supply chain issues that had made it a viable project, [are] no longer viable.'”

The Charlotte Observer in North Carolina. “Charlotte has rarely, if ever, seen as much office space sitting empty in uptown as it has now. If you took all the empty office floor space spread out across uptown and put it in one building, it would fill the entire Bank of America headquarters — the state’s tallest skyscraper — three times over. Put another way, roughly one in every five office floors in uptown sits empty, setting a record late last year not seen in at least the last 25 years, according to JLL. What’s more, the 185 empty floors — out of about 940 tracked — is also more than what the city likely has ever seen before, partly because it’s been been growing for so many years, said Barry Fabyan, senior managing partner with JLL.”

“There are ripple effects for the rest of the city, too, Fabyan and other commercial real estate experts told The Charlotte Observer. Retail can begin to suffer, with fewer people frequenting lunch spots or bars after work. ‘If you want to have a city in decline,’ Fabyan said, ‘just have a central business district in decline.’ The snowball effect, as Fabyan described it, can slowly erode the health of a city.”

“Loan troubles are not unique to Charlotte. There are nine buildings on the CMBS watchlist in the Raleigh and Durham area, CoStar data show. In bigger cities like Los Angeles, nearly all office tower owners owe more to the bank than the buildings are currently worth, according to a recent story by Slate. ‘Office buildings are the weak link in commercial real estate right now,’ said Mark Vitner, chief economist at Charlotte-based Piedmont Crescent Capital, ‘and the weakest link in the office sector is the oldest building in the central business districts.'”

“The uncertainty is leaving some office tenants to sit on the sidelines, Vitner told the Observer. They feel they could get a better deal as more space becomes available. The same goes for prospective buyers who feel like prices are going to get better by waiting. ‘People have doubts as to what the return to office is going to look like,’ Vitner said.”

The National Post. “One of these relief measures is the extension of amortization terms. In recent months, all of Canada’s big banks have reported a vast expansion in the number of mortgages on their books with amortization periods of 35 years or longer. For borrowers, that means their monthly payments go down, but they have to keep paying them for an extra 10 to 15 years. Either way, the effect is that Canadians are able to handle larger amounts of credit, which is further increasing the amount of money available to bid up prices. What’s more, it’s rewarding the ranks of overleveraged real estate buyers who helped bid up the market in the first place.”

From Reuters. “Canada’s financial regulator is urging lenders to tackle risks from mortgage extensions at the ‘earliest opportunity’ as many borrowers try to navigate higher mortgage costs after the Bank of Canada’s surprise rate hike last week. The Office of the Superintendent of Financial Institutions’ (OSFI) urgency underscores the concern about the risk accumulating in Canadian lenders’ books as the central bank has resumed interest rate hike after a four-month pause.”

“‘OSFI expects a more prudent and active account management approach, including resolving negative amortization at the earliest opportunity as well as recognizing the higher risk of these loans in loss provisioning,’ the regulator said in a statement to Reuters. ‘Our ongoing conversations with financial institutions have highlighted the importance of being proactive in managing all types of mortgage accounts, and to act before levels of borrower stress become unmanageable.'”

“Desjardins analyst Royce Mendes noted that the big six Canadian banks had more than 20% of their mortgage portfolio with repayments greater than 30 years in the first quarter as a result of variable-rate loans that have become non-amortizing, up from roughly 2% of the mortgage portfolios the prior year. At the same time, variable-rate holders are facing at least 30% increases in payments to remain on their original schedule. As a result, some might opt to extend repayments, Mendes notes.”

City AM in the UK. “London homeowners looking to renegotiate their mortgage this year face a whopping £7,300 rise in annual costs as experts warn of the ‘grim reality’ of rising interest rates. ‘While the Bank’s tightening cycle might be nearing its end, the impact on households is only just beginning,’ Benjamin Trevis, economist at CEBR warned. ‘With mortgages often occupying the most significant portion of household expenses, our estimates underscore the grim reality of rising rates, which will exert further strain on already stretched incomes, and hence the wider consumer economy, well into 2024.'”

“‘The mortgage affordability crisis has cast a dark shadow over those seeking to remortgage their homes, leaving a trail of challenges in its wake,’ Myron Jobson, senior personal finance analyst at interactive investor, told City A.M. ‘The golden era of low mortgage rates has come to an end following a rapid rise in interest rates to combat red hot and sticky inflation. Mortgage costs are predicted to rise further still after recent higher than expected inflation figures raised forecasts of how much UK interest rates will go up.'”

The Chosenilbo in Korea. “Apartment prices in Seoul, which plummeted more than 20 percent last year due to surging interest rates, have been rising for four consecutive months so far this year as more homes were bought and sold thanks to eased loan restrictions and ‘soft’ housing loans for certain groups. But that also meant that household loans taken out from commercial banks increased by W4.2 trillion last month to reach a 19-month high.”

“But a repeat of the frenzied apartment bubble during the Moon Jae-in administration, when young Koreans took advantage of ultra-low interest rates to borrow heavily to buy apartments, must be avoided at all costs. The latest trend appears to be as yet a temporary rise rather than a shift to full-fledged growth and requires caution. Apartment prices in Seoul surged 99 percent during the five-year term of the Moon administration but dropped only 22 percent last year. That means the price-to-income ratio, which shows how many years of income must be saved to buy a home, stands at 12 times in Seoul, which is even higher than New York (seven times) and London (eight times).”

From ABC News. “Economic research reveals the pain being felt by Australian mortgage borrowers, while casting doubt on the narrative of a universal rental crisis. The modelling by Ben Phillips at ANU’s Centre for Social Research and Methods shows that Australians with mortgages are now paying more than a quarter of disposable income on housing costs. Mr Phillips said the typical mortgage borrower had seen a 47 per cent increase in their housing costs relative to their income compared to before the pandemic, when the Reserve Bank (RBA) cash rate was between 1.5 to 0.75 per cent.”

“Data from ratings agency S&P shows the arrears rate on ‘prime’ loans, where applicants have met more stringent income-verification processes, jumped from 0.76 per cent in the December quarter to 0.95 per cent in the March quarter. The situation is far worse for so-called ‘nonconforming,’ otherwise known as low-doc or subprime, loans. Arrears for these loans leapt from 3.2 per cent at the end of last year to 3.7 per cent by the end of the first quarter. ‘Arrears increases were much higher in the more advanced arrears categories,’ S&P observed. ‘As nonconforming loan arrears started rising earlier in this monetary tightening cycle, they have transitioned faster to later arrears categories.'”

Stuff New Zealand. “The downward trajectory of house prices remained almost unchanged in May, according to Quotable Value (QV) data. In the three months to the end of May, house prices fell 3.42%, compared to 3.46% during the three months to the end of April, the property data and valuing company reported. The most recent quarterly fall was less than the 3.9% fall the market experienced from January to March. QV estimated the average house price now sat at $888,930, which was 13.7% lower than the same time last year and 20.2% higher than its pre-Covid-19 level. ‘Most areas of the country that have experienced positive value growth or held relatively steady over the last quarter have had average values of well below $1 m. In other words, ‘first-home buyer territory’, said QV) operations manager James Wilson.”

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This Post Has 90 Comments

  1. ‘Sternlicht has said the Fed’s campaign to hike rates is ‘bordering on idiotic.’

    Jerry broke it off in yer a$$ Barry.

      1. Barry & his ilk could speculate with wild abandon, knowing the Fed & middle class taxpayers had their backs.

    2. So I guess they were looking for profit in the price appreciation of the properties. If they made their profit from the rental income, a drop in prices due to higher mortgage interest rates wouldn’t affect their profits as much.

      1. Owning thousands of SFR rentals doesn’t work when you have to hire people for management, repairs, and maintenance spread out all over the country. MFR rentals can cash flow because they are concentrated

    3. ‘Sternlicht has said the Fed’s campaign to hike rates is ‘bordering on idiotic.’

      But pricing workers out of shelter was just fine, so long as billionaire Barry was getting even more stinking rich. It’s too bad he doesn’t get struck by lightning.

      1. They’re parasites living off the labor of others with the help of the Federal Reserve banksters

  2. ‘It also warned again against believing any predictions of a massive wave of foreclosures, calling people who believe that ‘deluded by fabricated data that exists only in their own mind’

    ‘Last week there were only 993 foreclosures pending in Maricopa County’

    Tina and the Cromford posse are getting a little tetchy. I had asked if anyone went down to the courthouse and it looks like they did. A thousand defaults in one sh$thole county. And that’s what’s had legal action. Let’s say your were interested: it would take a team of dozens to check out 1000 shacks before auction. In other words more than you could even look at.

    1. ” it would take a team of dozens to check out 1000 shacks before auction. In other words more than you could even look at.”

      And this is still considered low, in a few years it will be multiples of this and people will need to make it their full time job if they want to properly get in sync with it. This is why I am always trying to nudge people to prepare for it. It requires a lot of focus to wrap your head around a market like what is coming but in the long run it is worth the effort.

  3. ‘it’s not a giant toilet, it is not a trash dump’

    Yes it is Todd. America’s best giant toilet.

      1. I would imagine that a treatment plant needs to be constructed in San Ysidro, CA at the border as any funds sent south will likely disappear.

  4. Adding to yesterday’s restaurant thread, I have almost completely stopped eating out unless I’m travelling.

    Wendy’s $3 breakfast deal or $6 biggie bag for lunch, or once a month the $12 combo meal from Culver’s.

    It’s not just about the cost, it’s also a financial boycott of the City of Denver. No sales tax revenue for Denver, no contributing to the economy of Denver.

    Electing a new mayor is not going to stop the “doom loop” trajectory of Denver, which it voted upon itself.

    1. Meth / fentanyl camp near the electrical supply shop by 6th Ave and I-25:

      https://ibb.co/nQKFfPq

      Multiply this by 1,000 and that’s Denver. Multiply this by 5,000 and that’s what Denver will be by the end of Mayor elect Johnston’s first term in office.

      1. A 32 yearold girl who had some problems but was still a mother and productive member of society bought a Zanax last week, she’s dead now it was laced with fentanyl.

        1. Where did she get the Xanax? On the streets? I’m always afraid that fentanyl will find its way into commercial OTC meds, like that bottle of ibuprofen from Wal-Mart.

        2. I forgot to mention she grew up in our neighborhood and was friends (plymates) with two of my daughters.

      4. Multiply this by 5,000 and that’s what Denver will be by the end of Mayor elect Johnston’s first term in office.

        A San Francisco without the bay.

  5. Re: Starwood’s Sternlicht has said the Fed’s campaign to hike rates is ‘bordering on idiotic.

    Really? Where was such righteous indignation when the Fed was monkeying with brilliant strategies like LIRP, ZIRP, NIRP and QE and sending house prices into the stratosphere?

    1. “Where was such righteous indignation when the Fed was monkeying with brilliant strategies like LIRP, ZIRP, NIRP and QE and sending house prices into the stratosphere?”

      – This is the Fed’s “wealth effect,” but debt isn’t wealth. Now experiencing the “anti- wealth effect.” “Investors” like free $. Duh! The Fed “learned” this in the dot com bubble and housing bubble 1.0. Only possible with regulatory and legislative capture. Now we have “The Everything Bubble,” aka “The Central Bank Bubble,” or “The Mother of All Bubbles.”

      – Investors sad 😢 panda 🐼 because the financial heroin is being removed, albeit very slowly and much slower than the artificial stimulus was applied. Total Fed liquidity is actually up now (non-QT). The Fed balance sheet has hardly budged. Just look at stonks.

      – Some May eventually have to work for a living! 😮

      – The government, including the Fed caused these bubbles. Bubbles always burst. Enjoyed the boom 💥? Now enjoy the bust. ☠️

      – Bubble-nomics. Free markets, I hardly knew ya! It’s a clown 🤡 world 🌎.

  6. New York Post (6/13/2023):

    “President Biden acted amused Tuesday when asked about the alleged existence of audio recordings of himself and the Ukrainian businessman who allegedly bribed him while he was vice president.

    “Are there tapes that you accepted bribes, President Biden? Is that true?” The Post asked Biden as he left an event with US diplomats in the White House East Room.

    Biden, 80, stopped mid-stride and turned around with a smile on his face — then seemed to chuckle to himself and shook his head as he turned to walk away without saying a word.

    Sen. Chuck Grassley (R-Iowa) revealed Monday that a paid FBI source said the same Ukrainian businessman who allegedly paid $5 million apiece in bribes to then-Vice President Biden and his son Hunter in 2015 and 2016 said that he had 15 audio recordings of Hunter and two of Joe Biden that he kept as “insurance.”

    https://nypost.com/2023/06/13/biden-grins-chuckles-when-asked-about-alleged-tapes-of-him-getting-bribed/

      1. This has always been his standard response whenever he is either lying or being asked about a lie. The only surprising thing is that most people haven’t figured out that this is his ‘tell’ yet. He’s only been doing it for decades.

  7. New York Post (6/13/2023):

    “The pain is getting deeper for San Francisco as the owners of one of the biggest shopping centers in the city decided to walk away after 20 years, in the face of declining sales, occupancy and foot traffic.

    Unibail-Rodamco-Westfield said late on Monday it will transfer its Westfield San Francisco shopping mall to lenders.

    Westfield’s decision is the latest blow to San Francisco, the once-booming tech hub that has been particularly hard hit by the pandemic.”

    https://nypost.com/2023/06/13/san-francisco-takes-big-hit-as-mall-owner-westfield-flees/

    It is LEGAL to steal up to $950 of goods in California. No consequences.

  8. It is getting too expensive to ship items anymore especially with dimensional pricing….for example i have some beautiful almost new silver 60/200 in plastic dj sleeves cd hard case that would easily fetch $50 each but because they are bulky and weigh less than5 labs each they charge for 20 lbs, not 5. if you are close by on the east coast it adds a few dollars but to ship to CA its $40 at fed ex. Even shipping cds 1 for $4 and 100 for 25 cents each media mail. and they will raise prices even more….its called the first pound pricing used to be like $2 now its like $8.95
    https://pe.usps.com/text/dmm300/Notice123.htm

    In addition to a 30% pay increase, pilots won a 30% increase to the legacy pension and a company-funded replacement for the legacy pension

    https://www.freightwaves.com/news/fedex-pilots-take-another-step-toward-30-pay-raise

          1. It’s been a while since I’ve been in an SBUX, but I don’t recall ever seeing a cleavage or thigh gap working there. It’s usually undocumenteds, young fatties, purple half-shaves, and unidentified identifiers.

        2. You need quite a bit of dexterity to make the expensive coffee drinks. A drip coffee is one thing, but something that requires blending, foaming, crushing, etc. needs a human touch.

    2. pirateship will get you the lowest price possible without a commercial account of your own and with no added fees/subs, never pay retail to ship

  9. Suddenly I’m hearing a whole lot of boo hooing about housing from everyone.

    What happened?

    1. Please clarify. Who is doing the boohooing, and what about? Are we here on this blog boohooing about prices going down, or not going up? Is the media boohooing?

  10. In my opinion, baby boom generation turned the housing market in some sort of monopoly, with the help of corrupt city holes especially in California. Thanks to Ben Jones’s this site I understood it and got into that “ market” in 2010 in California and sold my house last year and moved to South Carolina bought the house the same size with no mortgage. It is all about market manipulation all around…

      1. The older GenX, but not the last ones like me. My first home purchase was in 2008. I did make some money off it, but definitely didn’t get rich. That money will eventually go back into another home, hopefully near the beach.

        1. I’m a middle GenXer. My first home purchase (age 41) was in 2012. I will make a fair amount on it, mainly because I plan to pay it off. It won’t make me a millionaire tho, not by itself.

          1. I will make a fair amount on it, mainly because I plan to pay it off.

            It will make you rich if you pay your debt? Interesting.

          3. Blue, yes. Paying off the mortgage won’t give me riches, but it will be far better than *not* paying off the mortgage. How many people are retiring into a paid off house these days? Not many. All I see is serial refinancing and empty nesters buying $400K homes into a Del Webb golf course community, etc.

          4. How many people are retiring into a paid off house these days? Not many. All I see is serial refinancing and empty nesters buying $400K homes into a Del Webb golf course community, etc.

            I don’t know what kinds of people you hang out with, but almost every baby boomer I know that is retiring has paid off their house. I paid mine off ages ago and so the only expenses I have for my home is insurance (about $100/mo) and property tax (about $200/mo).

            I can’t think of a single relative or close friend that hasn’t paid off their homes. Most of the people I’m talking about were skilled professionals (lots of engineers, etc) and only bought one home in their lives, or if they bought more than one, it was only because of necessity because of changes to their employment.

            And about the parents of these boomers who bought their houses after the war for $12,000, I know lots of those, too. By the time their parents had passed away and their childhood homes were put up for sale, none of the kids (boomers) needed the money. For example, I know of two people that sold their parent’s homes for around $1,000,000 (originally were $12,000 cheap tract homes). Unfortunately, several of the kids had already died and those that were still around, didn’t need the money.

            So when profits were realized, that money was passed to the next generation. Except for my brother who bought long ago for an “investment”, nobody I know ever purchased a home for that reason. And my brother ended up staying in his home and it’s worth a lot more than he paid, and so in retirement he’s just sitting pretty.

      2. As a Millennial I’m starting to wonder what is the point. So much manipulation, and it clearly benefits those who got in the game decades ago.

        Maybe I should just get a new car, go on vacation four times a year, eat out multiple times a week, and borrow as much as a lender will lend. Saving is stupid.

        1. As a Millennial I’m starting to wonder what is the point.

          This is, unfortunately, why some people decide to give communism a try.

        2. Many of my posts are specifically aimed at folks like you. You are beginning to see the bigger picture but once you understand the cycle you can get on board at the right entry point. You WILL need savings for it though. The most important thing is to understand that this is a big process that plays out over many years and you have just been in the wrong phase but the phase is absolutely turning and it is going to turn hard. Will you be ready? You should be preparing for battle when the blood is thick on the streets. It is coming.

        3. The young ones want to live in a home as good or better than their parents have. Give me the dirty and out of date house in a better neighborhood and a Big Box credit card and I’ve been known to scrub
          the walls – doors-and cabinets and apply a clean/fresh coat of paint.
          You can learn to do almost all of the improvements on those videos on your computer. It is amazing how many potential renters comment on the cleanliness, or lack of cleanliness in the rentals they have been looking at. If I set the example by presenting a clean rental, my residents know what I expect. Remember-Happiness is a positive cash flow.

          1. The young ones want to live in a home as good or better than their parents have.

            Yawn. Whatever, dude. Income to cost ratios are not what my parents faced.

        4. There are many other countries that are not destroying the middle class. Not telling you to leave, but it’s an option. Spend wisely and buy when the crash comes. It always does.

          1. Plus there is no guarantee that any of those countries will grant you an immigrant visa. In fact, it is almost certain you will be turned down.

    1. You probably read only LA Times, We bought our house in new community, they have probably 10 other communities around Lake Murray area, all of them occupied… prices are moving up… 😉

      1. It wasn’t that long ago that rioters were torching downtown La Mesa. Your cop palace was under siege and the banks were on fire etc. SD county is now reporting a minimum of 10,000 homeless, a new record. SD is not any more invincible than SF was. It’s just a matter of time. How much is your stucco box REALLY worth there? Stay tuned…

        1. It doesn’t matter what the CA stucco box is worth now… he sold it and went East. As all wise men should. No water fights here!

      1. For real Housing Analyst/BFB etc.?

        Jeez, I worried that he had one Cheeto too many. How You Doing! Missed you on Twitter.

        I just got kicked off, only 12 hours. Apparently Geraldo Rivera said something stupid, shocker, and I said I wished Kurt Vonnegut was still alive, so he could punch him out again.

        I’m advocating violence, apparently. So it goes.

        1. Geraldo himself probably cried out for support. It’s been a long time since he was a boxer, he has transitioned. Sad!

          1. I’m not going to link, takes forever.

            Vonnegut on Geraldo Rivera: “He’s a scum***.”
            https://www.democraticunderground.com/10026599973

            Looks like he didn’t really punch him, but sounds like he wanted to (for cheating on his daughter.)

            Another article, quote from Kurt Vonnegut: Letters

            In an unintentionally amusing letter dating from 1973, Vonnegut refers to Geraldo Rivera, Edie’s then-husband — and current Fox News reporter — as “a fierce Democrat and closet Marxist.” So it goes.

          1. It can be fun to chime in, especially if you’re older and remember stuff from way back. Doesn’t really matter a damn though.

            So many people realizing certain things makes me glad, but it’s also nerve-wracking 🤯

  12. CNBC — Nearly all Americans cut back on spending due to inflation, CNBC survey finds (6/14/2023):

    “Nearly all Americans are cutting back on their spending in some way, according to a new CNBC and Morning Consult survey.

    Shoppers continue to report inflation squeezing their finances, with concerns particularly heightened among middle-income Americans. Of the survey respondents, 92% of middle-income Americans — or those who make between $50,000 and $100,000 a year — reported being “somewhat” or “very” worried about higher prices.

    Over the last six months, higher prices have led nearly 80% of consumers to cut spending on nonessential goods, like entertainment, home decor, clothing, appliances and more, the survey found.

    Further, two-thirds of respondents reported spending less on essential items, like groceries, utilities and gas. In the grocery category, more than half of consumers said they’re buying cheaper alternatives, like private label brands, or just generally buying less.

    https://www.cnbc.com/2023/06/14/nearly-all-americans-cut-back-on-spending-amid-inflation-cnbc-survey-says.html

    Do you remember what everything cost in 2019?

  14. Yes, you are right, Last year in California gas prices were around $5 , here it around $3, with no traffic “around”. People are not “angry” at each other lol it was in California, ocean is 2 hour from our home, restaurants, supermarkets, banks 5-10 minutes, malls 15-20 minutes. Last year they didn’t charge me for house tax, paid for land, $37, it is going to be much less than California, our neighbors mostly are from New York, other Norther States, there are some grime California…

  15. ‘They feel they could get a better deal as more space becomes available. The same goes for prospective buyers who feel like prices are going to get better by waiting’

    That’s the spirit Mark, keep up the good work!

  16. ‘In recent months, all of Canada’s big banks have reported a vast expansion in the number of mortgages on their books with amortization periods of 35 years or longer. For borrowers, that means their monthly payments go down, but they have to keep paying them for an extra 10 to 15 years. Either way, the effect is that Canadians are able to handle larger amounts of credit, which is further increasing the amount of money available to bid up prices’

    ‘Our ongoing conversations with financial institutions have highlighted the importance of being proactive in managing all types of mortgage accounts, and to act before levels of borrower stress become unmanageable’

    ‘the big six Canadian banks had more than 20% of their mortgage portfolio with repayments greater than 30 years in the first quarter as a result of variable-rate loans that have become non-amortizing, up from roughly 2% of the mortgage portfolios the prior year. At the same time, variable-rate holders are facing at least 30% increases in payments to remain on their original schedule’

    That’s some sound lending right there.

  17. Russia Today (6/14/2023):

    “US President Joe Biden’s administration is reluctant to offer Ukraine full NATO membership and is instead pushing for the “Israel model,” meaning a time-limited commitment to maintain the flow of Western weapons to the country, the New York Times has reported.

    The pledge would fall short of a collective defense guarantee, which Kiev and some Eastern European members of NATO are advocating, the newspaper said on Wednesday, citing officials familiar with the deliberations. A possible commitment to Kiev would be shorter than the ten-year agreement that is signed with Israel, the report explained.

    Opponents of Ukraine’s accession to NATO are concerned it would further escalate the crisis with Moscow. They have argued that by joining the organization, Ukraine would play “into [the] Russian narrative” about the nature of the conflict, according to the report.

    https://www.rt.com/news/578008-biden-ukraine-israel-model/

    I just looked on The Hill and Politico websites and no mention of the $5 million bribe payments (to each, $10m total) to the unelected occupant and his drug addled son.

    Keep paying those federal income taxes, slaves…

    1. GOP: Where Did Joe Biden’s $10 Million Windfall In 2017 Actually Come From?

      by ZeroHedge
      June 14th 2023, 6:05 pm

      President Joe Biden reported earning $15.6 million in 2017, of which more than $10 million was listed as income from Joe’s memoir, and $3 million listed as income from Jill Biden’s book.

      In light of recent revelations from whistleblowers, including the fact that the FBI hid evidence that the owner of Burisma made 17 blackmail tapes of the Bidens, who were allegedly paid $10 million ($5 mil to Hunter, $5 mil to Joe), Republican lawmakers want to take a closer look at Biden’s tax return, according to Breitbart.

      Rep. Nancy Mace (R-SC) told the outlet that Biden should produce unredacted bank records to provide transparency.

      ““The President seems to find selling out our country funny. We don’t,” she said. “If he’s serious about proving our allegations wrong he should release his and his family’s unredacted bank records and show the American people where all this money is coming from. The FBI can’t protect him forever.”

      https://www.infowars.com/

    2. “I just looked on The Hill and Politico websites and no mention of the $5 million bribe payments (to each, $10m total) to the unelected occupant and his drug addled son.”

      No one f*cks with a Biden.

  18. For the first time in more than a year, the Federal Reserve has left interest rates unchanged but signaled that two more rate hikes are set to happen this year.

    The benchmark federal funds rate held steady at a range of 5–5.25 percent, effectively ending the streak of 10 consecutive rate hikes.

    “Holding the target range steady at this meeting allows the Committee to assess additional information and its implications for monetary policy,” the Federal Open Market Committee (FOMC) stated.

    FOMC members say the recent metrics show that economic activity is expanding “at a modest pace.”

    “Job gains have been robust in recent months, and the unemployment rate has remained low. Inflation remains elevated,” the FOMC said.

    “The U.S. banking system is sound and resilient. Tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation. The extent of these effects remains uncertain. The Committee remains highly attentive to inflation risks.”

    The rate-setting committee confirmed that it would continue decreasing its holdings of Treasury and mortgage-backed securities.

    In addition, Fed officials issued a new set of economic forecasts.

    The Survey of Economic Projections (SEP) shows that officials anticipate the policy rate to rise to a median of 5.6 percent by the end of 2023.

    FOMC members expect the median federal funds rate to come in at 4.6 percent in 2024, up from 4.3 percent in the March SEP. The benchmark rate will then further ease to 3.4 percent in 2025, up from the previous estimate of 3.1 percent. The longer-run policy rate was left unchanged at 2.5 percent.

    Looking ahead to the broader economy, the Fed forecasts the economy will grow by 1 percent this year, up from the March projection of 0.4 percent. Officials revised their 2024 real GDP forecast from 1.2 percent to 1.1 percent. The economy will also grow by 1.8 percent, down from 1.9 percent in 2025, according to SEP numbers.

    The unemployment rate was seen coming in at 4.1 percent this year, down from the previous SEP projection of 4.5 percent. The jobless rate was also revised lower, to 4.5 percent in 2024 and 2025, down from 4.6 percent.

    The next FOMC meeting will be held on July 25 and 26.

    Stocks tumbled after the Fed’s announcement but rebounded during Fed Chair Jerome Powell’s news conference. The S&P 500 gained 0.1 percent, while the Dow Jones Industrial Average ended the day down 0.7 percent.

    U.S. Treasury yields were mixed, with the benchmark 10-year yield down by more than 4 basis points to about 3.79 percent.

    The U.S. Dollar Index, a measurement of the greenback against a basket of currencies, erased most of its losses in the middle of the trading week, climbing back above 103.

    “The Fed caused heartburn with their estimates of future rates, implying their concern for high inflation outweighs the softening in growth we are experiencing,” Jeff Klingelhofer, co-head of investments at Thornburg Investment Management, said in a note. “The most concerning data point for markets is the significant rise in the ending target for the Federal Funds rate, which moved up a full 50 basis points to 5.6 [percent].”

    While some may characterize the central bank’s decision as a “skip,” Powell declined to call it that.

    Powell said he doesn’t anticipate a rate cut until inflation falls at a substantial rate, which could still be another couple of years.

    “It will be appropriate to cut rates at such time as inflation is coming down really significantly. And again, we’re talking about a couple of years out,” Powell said at the post-FOMC meeting news conference on June 14. “As anyone can see, not a single person on the committee wrote down a rate cut this year, nor do I think it is at all likely to be appropriate.”

    Still, Powell is seeing progress on the inflation front, particularly in goods. However, the Fed chief said he thinks the disinflation will emanate from the housing market as rental lease prices fall.

    The futures market is penciling in a 61 percent chance of a quarter-point rate hike at next month’s policy meeting.

    “We didn’t make a decision about July,” Powell said. “Of course, it came up in the meeting from time to time, but really the focus was on what to do today. I would say two things. One, a decision hasn’t been made. Two, I do expect that it will be a live meeting.”

    Heading into the FOMC policy meeting, several Fed officials suggested that a rate pause wouldn’t indicate the end of the central bank’s tightening cycle. By hitting the pause button on a rate increase, policymakers could assess the economic data and determine the next course of action.

    Meanwhile, inflation growth rates continue to slow.

    The annual consumer price index (CPI) eased to 4 percent in May, down from 4.9 percent in April and below the consensus estimate of 4.1 percent. The monthly CPI rose by just 0.1 percent.

    Core inflation, which eliminates the volatile food and energy components, dipped slightly to 5.3 percent year-over-year. This was down from 5.5 percent in the previous and matched market expectations. Core inflation also climbed 0.4 percent month-over-month for the sixth straight month.

    In May, the producer price index (PPI) fell by 0.3 percent month-over-month and eased to 1.1 percent on an annualized basis, according to the Bureau of Labor Statistics. The core PPI rose by 0.2 percent from April to May and slowed to 2.8 percent year-over-year.

    Looking ahead, the Cleveland Fed Bank’s Inflation Nowcasting anticipates another sharp drop in the CPI. The model estimates that the annual inflation rate will slow to 3.2 percent, and the core CPI will fall to 5.1 percent. But the CPI and core CPI are expected to rise 0.4 percent month-over-month.

    But with inflation showing signs of abating, is the Fed also achieving a soft landing?

    According to the Atlanta Fed Bank’s GDPNow model estimate, the second-quarter GDP growth rate is projected to climb by 2.2 percent.

    https://www.theepochtimes.com/federal-reserve-keeps-interest-rates-unchanged-leaves-door-open-to-more-rate-hikes_5332572.html

  19. “‘If the Superman building deal falls apart because of interest rates and supply chain problems”

    Supply chain problems my arse! That ship sailed with the mythical ship christened “COVID”.

  20. Somebody’s a lion.

    Date Event Price Price/Sq Ft Source
    06/13/2023 Listed $425,000 $179 Tallahassee
    05/05/2023 Listing Removed – – Tallahassee
    03/02/2023 Price Changed $449,900 $171 Tallahassee
    02/08/2023 Listed $460,000 $174 Tallahassee
    11/07/2022 Listing Removed – – Tallahassee
    09/08/2022 Price Changed $500,000 $190 Tallahassee
    07/09/2022 Listed $499,000 $189 Tallahassee
    05/02/2018 Sold $305,100 $139 Public Record
    04/28/2018 Listing Removed $299,900 $114 Tallahassee
    03/19/2018 Listed $299,900 $114 Tallahassee

  21. We’re not flooded with $1M homes in Tally. I guess someone is figuring that out! 16 years to break even!

    Date Event Price Price/Sq Ft Source
    06/14/2023 Price Changed $1,100,000 $332 Tallahassee
    03/16/2023 Listed $1,400,000 $423 Tallahassee
    06/09/2015 Listing Removed $1,260,000 $380 Tallahassee
    03/13/2007 Sold $1,100,000 $361 Public Record
    11/01/2005 Listed $1,260,000 $380 Tallahassee
    10/18/2004 Sold $500,000 $164 Public Record

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