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Property Empires Built On Cheap Credit Are Teetering

A report from Yahoo Finance. “Thirty-year mortgage rates cross over 7 percent as elevated rates and affordability woes squeeze homebuyers out of the market. ‘Right now the mortgage rates are touching that cyclical high level, I don’t think it will break higher,’ says National Association of Realtors Chief Economist Lawrence Yun. ‘I truly wish the Fed would stop raising interest rates because they are clearly overreacting, the overall inflation rate is calming down.'”

The Marin Independent Journal in California. “Bay Area home prices are falling as mortgage rates climb to their highest levels in more than two decades. In Marin, the median price for detached homes, also called single-family homes, was $1.61 million in July, according to the latest data from the county assessor’s office. The figure marked a decline of nearly 6% from the June median of $1.71 million, and a 5% decline from the July 2022 median of $1.8 million. From June to July, median home prices dropped 8.5% in San Francisco to $1.46 million, 3.4% in Alameda County to $1.26 million, 3.2% in Contra Costa County to $900,000, 2.7% in San Mateo County to $1.98 million and 1.4% in Santa Clara County to $1.8 million.”

“Sellers now putting houses up on the market are often doing so reluctantly. ‘It’s definitely more so out of necessity, and they’re doing so unhappily because they have a direct comparison point to just a year and a half ago,’ said Montana Gabrielle Hooks, an Oakland real estate agent. Hooks said some of her clients have been forced to sell as their employers put an end to full-time remote work. One is stuck selling a recently purchased, spacious new-build in suburban Fairfield after being required to show up to the office in San Francisco. ‘They would have never have purchased it if there was even a decent chance that they had to come back to the office so soon,’ she said.”

The Herald Tribune in Florida. “Roger Pettingell, a luxury waterfront specialist with Coldwell Banker Realty said he did feel the market has returned to normal, pointing to slower sales this summer than the previous two, which he noted was fueled by people making decisions based on the pandemic reality the country was experiencing two and three years ago. ‘I would say we are exactly where we always are in August, in every other market besides the last two years,’ he said about the current state of the luxury market. ‘Now we can look in the rearview mirror and declare the last two years a complete anomaly. They didn’t make any sense; we were being flooded by buyers coming out of areas who wanted to be able to live outside and move into these homes with duel offices because everybody was working from home and we had this whole buyer pool that we never saw during summers before. And we don’t see them this year.'”

Denver 7 in Colorado. “An Arvada homeowner had to move out of his newly purchased condo only 10 days after buying it because a fire spread to his unit. Now, nearly 16 months later, he is fed up over the lack of progress his homeowners association has had in making the necessary repairs to the building. A reminder is taped to Ted Bauer’s door at the Mountain Vista Village Condos, it says ‘Habitable, Repairs Necessary’ and is dated April 29, 2022. That’s the day a fire moved from a unit next door and into his. It burned in the attic and damaged his condo. He said he learned the hard way, that owning a condominium comes with limitations. ‘You only own what you see, the space. You do not own that floor. You do not own that wall, that wall, that ceiling. You own nothing. You just own the space. The HOA owns all this. I didn’t know that at the time,’ said Bauer. ‘I bought it April 1, 2022. I paid $300,000 cash to own this. On April 29, I was living in a hotel.'”

The Wall Street Journal. “Thousands of New York City Airbnb listings are vanishing from the market. Hosts are removing listings in response to a city-mandated deadline, and Airbnb is blocking future dates for booking. Starting Sept. 5, city officials say they will enforce rules on short-term rentals more aggressively. Tom DeRose stopped listing short-term rental units earlier this year when New York’s new law passed. The 23-year-old engaged in what he calls ‘Airbnb arbitrage’: renting apartments, then listing them on Airbnb despite not living there. At his peak, he says he had as many as eight listings and could earn $10,000 a month on a three-bedroom listing during summer months.”

“DeRose says he didn’t know this was prohibited when he started. But he says New York’s strong tenant laws and the prior lack of enforcement made it easy. Now, he says the regulations make sense to target people like him. ‘I think, overall, what they’ve done is good for New York City. But I think some hosts who aren’t really taking away from the housing supply and are just trying to make a living are getting screwed off this,’ he says.”

Business Insider. “WeWork dropped a bomb in in its second-quarter earnings on Tuesday. ‘As a result of the company’s losses and projected cash needs, combined with increased member churn and current liquidity levels, substantial doubt exists about the company’s ability to continue as a going concern,’ it said. Investors have balked at the situation. WeWork’s stock price is down 95% in the past year alone, and fell sharply in premarket trading on Wednesday. As a result, the company’s market capitalization has dropped below $500 million — a fraction of the $40 billion valuation it once commanded as a private company.”

“Those headwinds dragged on WeWork’s financials last quarter. It reported a net loss of $1.1 billion on revenues of $1.6 billion last quarter, and its operating cash outflow exceeded $500 million in the first half of this year. Its failure could be a ‘systematic shock’ to commercial real estate in many American cities, Stijn Van Nieuwerburgh told The New York Times in June. ‘It would pour more cold water on the office market, which is struggling direly,’ the Columbia Business School professor and real-estate expert added. He recently warned that troubles in the office segment could hammer cities, spark a credit crunch, and weigh on overall economic growth.”

CTV News in Canada. “The tightening of market conditions that unfolded in the spring is ‘unwinding rapidly’ and Toronto is now the closest it has been to a so-called buyer’s market since last winter, a new report from RBC suggests. ‘The spring tightening in demand-supply conditions is unwinding rapidly in BC and Ontario. Softer sales and increasing new listings returned most markets in these provinces to balance, with Toronto the closest it’s been to a buyer’s market since January,’ the report states. ‘We expect higher interest rates to keep curbing buyers’ enthusiasm for months to come, while possibly forcing the hand of some current owners to sell.'”

“The bank says that a 24 per cent increase in listings that has occurred nationwide since April has now fully reversed the declines seen earlier this year. Going forward, the bank anticipates that conditions in the real estate market will be ‘bumpy’ but it is not calling for outright price declines at this time. The average selling price of a Toronto home across all property types peaked at $1,334,062 in February 2022 before dropping to a low of $1,037,542 amid what RBC previously called a ‘historic’ housing correction brought about by the Bank of Canada’s aggressive interest rate hiking cycle. The average selling price in July was $1,118,374, up about 4.2 per cent from one year prior.”

The Deep Dive in Canada. “Another late-night fire hit a row of pre-construction sold properties over the weekend. At least eight under-construction homes were destroyed at Keonig Road on Saturday, August 19. The Ontario Fire Marshall, along with the Halton Region Police Services (HRPS), has launched an investigation. No cause for the fire has been identified as of this writing, but the blaze has been determined to be suspicious. The fire is the second incident in Burlington this month. Six unoccupied under-construction Branthaven townhouses, part of the Millcroft Towns project, were destroyed in a fire that was reported at 4:30 a.m. on Wednesday, August 2. These Burlington fires follow a string of similar incidents in the Greater Toronto Area. The trend has also hit Ottawa, when an under-construction rowhouse on Esban Drive was swallowed by flames at around 1 a.m. on Tuesday last week.”

The Daily Mail in the UK. “The housing market is in a deep mid-summer freeze, with viewings last month falling off a cliff. Henry Pryor, a professional buying agent and property expert believes if Propertymark’s figures are correct, then further house price falls should be expected. ‘If correct, then the housing market may have just entered a nuclear winter,’ says Pryor, ‘estate agents will be offering up their first born child to persuade you to view a property. They’ll send a limo to pick you up and take you there and then beg you to make them an offer. Any offer.'”

From Bloomberg. “SBB, the landlord at the center of Sweden’s commercial property crisis, was slammed with a downgrade of five steps further into junk by Fitch Ratings in a fresh blow for its new chief executive’s efforts to stabilize finances. Grappling with an $8 billion debt pile, SBB has become emblematic of how a year of central bank rate hikes have upended real estate in the biggest Nordic economy. Property empires built on cheap credit are teetering after suddenly facing a twin challenge of sliding asset values and higher financing costs.”

“The industry is now trying to figure out how to repay mountains of debt, and investors have taken note. SBB’s bonds have long been trading at distressed prices, reflecting junk-grade rating levels. Its shares have lost more than 90% of their value since the start of last year.”

News.com.au in Australia. “A tradie left hundreds of thousands of dollars out of pocket from a building firm going bust is calling for greater protections for subcontractors to spare him more financial pain. For Tasmanian electrician Kyle Skipworth, at any given moment, he is usually owed around $500,000 in unpaid debts from several builders. But as building companies drop like flies, leaving a trail of devastated creditors in their wake, he is growing increasingly concerned that every month could be the last for his own business.”

“Mr Skipworth, a young dad-of-one based in Hobart, is calling for greater protections for ‘subbies’ as they are the ones ultimately left to foot the bill every time a builder collapses. ‘Builders have all the power in negotiations. They withhold payment and there is nothing we can do,’ he told news.com.au. Mr Skipworth, 31, was financially impacted when Tasmanian builder Multi-Res Builders Pty Ltd went into liquidation in May owing $3.5 million. He wore the loss of $102,000, having to take out a small business loan to keep his company afloat. For the past year he has been paying off the loan, which comes in at $500 a month including interest. At the moment, he thinks another builder is on the cusp of bankruptcy, after waiting for a $10,000 payment for months.”

“Mr Skipworth recalled how he was working for Multi-Res Builders in May last year and ‘I was two months in before I realised I had a problem.’ ‘They used the debt as leverage to keep me working,’ he explained. ‘They just didn’t pay. It was just the promise of payment.’ As a result, the debt continued to pile up, with his invoices going unpaid. It got to a point where he refused to work for them any longer. For a while, things were at a standstill, until a new subcontractor was brought in to finish the job. Then in March this year, his worst fears were realised; Multi-Res Builders had appointed liquidators. ‘I was disappointed, I’d held hope for 12 months that the company was generally reasonable and would honour their word,’ he said. ‘When they liquidated I knew then I wasn’t going to get my money.'”

The South China Morning Post in Hong Kong. “Almost 4,000 homebuyers rushed to snap up flats at CK Asset Holdings’ Coast Line I in Yau Tong on Sunday, just a week after all units in the other phase of the project, Coast Line II, sold out on their first day of sales. CK Asset, the flagship property developer of feted tycoon Li Ka-shing, priced the flats in Coast Line I at an average discounted price of HK$15,939 (US$2,035) per square foot. That was slightly higher than the average HK$14,868 per square foot price tag at last weekend’s sale, which itself was about 16 per cent cheaper than the most recent launch in January of Wheelock Properties’ Koko Rosso project in the same neighbourhood.”

“The prices of new flats launched recently were 20 to 25 per cent lower than those of second-hand apartments of the same quality in the neighbouring areas, said Chan Wing-kit, CEO of the residential division at Centaline Property Agency. ‘Although the property market has been in a downturn, as long as there is a discount, people will rush to buy flats,’ he said.”

From Reuters. “China unexpectedly lowered several key interest rates earlier this week in a bid to shore up struggling activity and is expected to cut prime loan rates on Monday, but analysts say moves so far have been too little, too late, with much more forceful measures needed to stem the economy’s downward spiral. Once China’s top-selling developer, Evergrande has become the poster child of an unprecedented debt crisis in the country’s property sector, which accounts for roughly a quarter of the economy, after facing a liquidity crunch in mid-2021.”

“‘The China property sector is like a black hole, so many developers have been dragged into it since two years ago after Evergrande,’ said Winner Zone Asset Management CEO and CIO Alan Luk. ‘The central government has yet to introduce (strong) measures because this is too large a hole to fill.'”

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This Post Has 122 Comments

  1. ‘he did feel the market has returned to normal, pointing to slower sales this summer than the previous two, which he noted was fueled by people making decisions based on the pandemic reality the country was experiencing two and three years ago. ‘I would say we are exactly where we always are in August, in every other market besides the last two years,’ he said about the current state of the luxury market. ‘Now we can look in the rearview mirror and declare the last two years a complete anomaly. They didn’t make any sense’

    Isn’t it crazy what a minor respiratory illness can do Roger?

    1. Roger is a scammer and was sued by Georgia Salaveri and her client. Roger listed a house and also represented a buyer. Roger withheld Georgia Salaveri’s client’s higher offer to the buyer so he could swing both sides and get the 6%. He has fallen into disfavor in Sarasota.
      When Georgia’s client saw the house closed for a lower price than what she offered, lawsuits were filed.

      1. Oops. Georgia Salaveri’s client made a higher offer to the SELLER than Roger’s buyer client but Roger was also the listing agent and withheld from the seller the higher offer.

  2. ‘Those headwinds dragged on WeWork’s financials last quarter. It reported a net loss of $1.1 billion on revenues of $1.6 billion last quarter’

    In accounting this is called hemorrhaging cash.

    1. Maybe they can make it up on volume. Lease out more office space and rent it out at below the cost of their lease.

  3. ‘I was two months in before I realised I had a problem.’ ‘They used the debt as leverage to keep me working,’ he explained. ‘They just didn’t pay. It was just the promise of payment.’ As a result, the debt continued to pile up, with his invoices going unpaid. It got to a point where he refused to work for them any longer. For a while, things were at a standstill, until a new subcontractor was brought in to finish the job. Then in March this year, his worst fears were realised; Multi-Res Builders had appointed liquidators. ‘I was disappointed, I’d held hope for 12 months that the company was generally reasonable and would honour their word,’ he said. ‘When they liquidated I knew then I wasn’t going to get my money’

    This whole industry is like that Kyle. They won’t pay the guy who replaced you either.

    1. “They used the debt as leverage to keep me working,” he explained.

      Psst, debt [is] leverage. 🙂

      2. leverage to keep me working

        No actually. They used your own lack of character. Honest men pay what they owe. Past the first week you knew they were dishonest and went along.

  4. ‘The prices of new flats launched recently were 20 to 25 per cent lower than those of second-hand apartments of the same quality in the neighbouring areas, said Chan Wing-kit’

    You fooked em real good Chan.

    1. Surely the latest crop of knife-catchers will be welcomed with open arms by their neighbors who just saw their skybox valuations take a big hit from Mr. Market.

  5. Clutch those pearls harder, scum media.

    The Hill — A third of adults believe COVID-19 vaccines caused thousands of sudden deaths (8/22/2023):

    “Belief in misinformation about key health issues persists among a good chunk of adults, with false claims about COVID-19, vaccines and reproductive health garnering a substantial amount of support, a new poll from KFF has found.

    The new polling data found that a third of adults believed the COVID-19 vaccines “caused thousands of sudden deaths in otherwise healthy people,” with 10 percent believing that claim to be “definitely true” and 23 percent saying it was “probably true.” Another 34 percent said it was “probably false” and 31 percent said that claim was “definitely false.”

    https://thehill.com/policy/healthcare/4162874-a-third-of-adults-believe-covid-19-vaccines-caused-thousands-of-sudden-deaths-poll/

    2. “Belief in misinformation”

      The increase in myocarditis from mRNA vaccines, specifically Pfizer, specifically young men, was first reported in Israel in summer of 2021. So I guess Israel is now “for-chan adjacent.” 🙄

    3. I got three shots at Rite Aid yesterday, flu, rsv and the hepatitis a,b. The EG.5 booster is not ready yet.

          1. Hope you’re feeling better. I guess this year’s flu shot variant will be a doozy? Good to know.

          2. How does being vaccine damaged increase your readiness? Besides, wokeness trumps readiness in the Biden military.

          3. How does being vaccine damaged increase your readiness?

            I assume that’s a rhetorical question.

          6. “How does being vaccine damaged increase your readiness?”

            Yeah, that’s a great question, but it’s way above my pay grade. Each generation of my family has always had at least one military participant, which means adhering to boundaries. I’ve been very lucky, medically speaking, and I haven’t abused alcohol, drugs or tobacco. And I’ve been careful with my diet, and always get some form of exercise. Lastly, I’ve never abused credit, and I’ve never had a collections activity.

        2. Ok, as talk increases about a new scary Covid mutation, they already have a booster for same . What, did they produce it within a month with no trials?
          Real evidence is mounting that they are preparing for masks, and whatever else follows from that.
          They clearly want to blame massive death, sickness and injury from vaccines on a new fake Covid mutation, with no doubt the fake PCR tests.
          No doubt any dispute to the new narratives will be censored or labeled disinformation.
          Word that they are planning to ban medical services, food stamps , welfare ,etc from anyone that won’t take the vax, which would be illegal as hell.
          IMHO, they will probably have a combo of Panademics with Climate Change emergencies to advance the One World Order, 2030 UN sustainable earth agenda.
          Of course the Powers that be were going to start this attack again . Reduce food by 30 to 40% , withdraw of energy, claiming your saving the earth from Climate Change.
          As they claimed they saved millions of lives by their Covid global lockstep insanity, the evidence shows up to 30 million have died by vaccine, and over two billion injured by the shots, and it will continue.
          The One World Order Powers have captured most the Governments to implement all these fraudulent emergencies , so the governments will enable this take over and mass genocide/denocide , starvation, freezing and brutal deprivation that planned for global populations.
          Who of sane mind would say that we need to cut off 30% to 40% of food supply to save earth, when it would probably kill 50% of population. Since when is premeditated murder acceptable as response to a emergency. A emergency that the evidence shows, we do not have a Climate Change Emergency, or global warming as alledged.
          So, no matter how insane, illogical, fraudulent, creating mayhem , this is their longed planned scheme to take over and do whatever they want to humanity.
          Can’t comply with nuts.

          1. The new booster was approved by the FDA a couple of months ago before the new variant was discovered and well before the new booster was developed. No shenanigans going on there at all. I’m sure it will be safe and effective.

  6. “…says National Association of Realtors Chief Economist Lawrence Yun. ‘I truly wish the Fed would stop raising interest rates…”

    Memo to Lawrence Yun:

    If wishing doesn’t do it, how about walking into the middle of the street and throwing a hissy fit?

    If that doesn’t do it, how about pounding on the wall head first?

    If that doesn’t do it, ……

  8. A reader sent these in:

    There’s no sugar coating this, CCP is in a very hard place, as much for it’s own policy choices as owing to current Fed and ECB uber hawkish monetary policies. Situation is more dire than laymen realize. Yuan is already one of Asia’s weakest $ pairs, down 6% YTD. Lowering 1y LPR by 10 bp when a deflationary spiral is now feeding a lower consumption loop shows how limited the policy margin really is. Even more telling is that they didn’t touch the 5y LPR which is far more important for mortgages. This when construction starts are down by 55% since 2021 and a massive inventory glut of over 27 trillion Yuan has to be re-balanced. Almost half of this inventory is unfinished and 40% (and rising) belong to distressed developers. Raising cash will necessarily entail liquidating part of this inventory when buyers are on strike, worse actually, when buyers are increasingly no longer servicing their mortgages. Losses will be in the trillions, over 2/3rd of which will be suffered by banks. How many trillions will depend on many variables, and even then, at current sales rates it will take many years for this to clear. Those who think China has an ideological agenda are wrong. They would be way more aggressive in kicking the can through liquidity, but they can’t. If they widen the rates gap they risk a bigger Yuan devaluation which would lead to capital flight at a time when geopolitical hurdles to inbound investments are raising. That leaves a heightened risk of deflation and contagion into shadow banks and other not yet distressed developers. I wrote about all this in 2021. With Zhongzhi Enterprise going into forced restructuring and many dodgy structured products sold to retail in default, contagion is now playing-out.

    https://twitter.com/INArteCarloDoss/status/1693601128498262219

    lol Paul Krugman agreeing is the kiss of death to any and every economic take, whatever the take. He’s the sh$t take test qualifier.

    https://twitter.com/INArteCarloDoss/status/1693664351830393209

    That’s the worst thing the Fed could do at this juncture… I get where he’s coming from but this ability to gain manœuvre will look very different if they do H4L, without messing with long-term inflation expectations. The problem is that their messaging credibility potential is somehow depleted.

    https://twitter.com/INArteCarloDoss/status/1693617209300402206

    Just saying. Real US 30Y mortgage rates.

    https://twitter.com/INArteCarloDoss/status/1693650968347300210

    $NVDA Bearish at the lows, bullish at the highs.
    December 2022: HSBC initiates sell, lowers price target to $136
    August 2023: HSBC maintains buy, raises price target to $780

    https://twitter.com/TrendSpider/status/1693612679511069056

    POV: Bought the top in suburban metro single-family. Opted out of rate protection and now is due to refi at 7.5%.

    https://twitter.com/JLinWins/status/1693617270956732586

    This is a @federalreserve crime.
    “Nearly 1 in 10 U.S. Homes Are Worth at Least $1 Million, Close to All-Time High”

    https://twitter.com/RudyHavenstein/status/1692615001943519711

    1. While the CCP might be in a hole, the Fed and, especially the ECB, are NOT uber hawkish — barely hawkish at best.

      1. The overall lack of Fed response in Lahaina is a warning and a reminder that no one is coming to save you if there is a disaster. Don’t expect the National Guard to show up with food, water and other supplies or to evacuate victims or to keep order. They will be nowhere to be found, except maybe to thwart evacuation. We are on our own. And to make matters worse, .gov is causing these disasters, either through negligence or even possibly malice.

          1. FEMA officials are staying at $1,000-a-night luxury hotels in Maui amid recovery efforts…

            Probably very few Best Western rooms at federal per diem rates around Maui.

          2. “The posh, five star hotel is a far cry from the shelters and temporary housing where displaced wildfire victims are living after losing their homes in the blaze.”

            These wildfire victims could seek shelter elsewhere using their home owners’ or renters’ insurance while waiting for the search and rescue effort to conclude.

          3. “There has also been anger about the $700 ‘one-time’ payment to help survivors get essentials such as clothing, food or transportation.”

            Broke ašš losers don’t have two-nickels to rub together?

  10. ‘They would have never have purchased it if there was even a decent chance that they had to come back to the office so soon,’ she said.”

    Idiots. You’d have to be a few IQ points short of moron to think WFH was the new normal into perpetuity, especially once the scamdemic receded.

    1. Actually, one of the few silver linings of the scamdemic was that it finally got corporate management to realize that people can be just as efficient, if not more so, working remotely.

      I remember back in 1989 working in an office where people complained of the need to commute in to work to do things that could be done just as easily at home. And the technology to work remotely existed even back then.

      But please feel free to volunteer to chauffeur all your neighbors to office buildings if you think that increases productivity.

      2. WFH works for some people at some jobs. It’s almost impossible to train a kid fresh out of college unless it’s a menial braindead job.

      3. I worked from “home” (wherever I happened to be) for the last decade of my career. I worked on projects for customers. The results were tangible (orders). With decades of specialized experience, I did more in a day than a younger engineer would screw up in a month, most times. That young inexperienced person would flounder at home if doing technical work. What I mean is that WFH isn’t the same for everybody in every job.

  11. “Starting Sept. 5, city officials say they will enforce rules on short-term rentals more aggressively. ”

    I have an easy solution. The city should allow these STRs, and then simply book them to house the illegal migrants coming in. AirBnB hosts will exit the market themselves. Fast.

    1. the same thought occurred to me also as I read about the STR situation: just house the all of the “migrants”.
      BOOM! everyone happy

      * like I tell the wife, if they’d just make me Emperor of the World, everything would be so much better.

      and I’d promise to always wear clothes.

  12. ‘Now we can look in the rearview mirror and declare the last two years a complete anomaly.

    Anyone paying attention knew intuitively that the scamdemic-era distortions were a “complete anomaly” that could never last. Let the lemmings who bought shacks at the peak of the Fed-juiced artificial housing boom reap the full measure of what they deserve for diving headlong into the lunacy.

  13. The HOA owns all this. I didn’t know that at the time,’ said Bauer.

    Ignorance is no excuse, Ted.

    1. If it makes you feel better, Ted, you don’t own a house either. The bank owns it, and then the State owns it. If you don’t believe me, try not paying your property tax.

    2. This is pathetic. He spends (well signs up for a loan for) 300,000 dollars and doesn’t even do basic research into what he’s buying?

      I learned this (the easy way) when I was just out of college a million years ago. Where are these super valued and knowledgeable real estate agents to explain this to him if he’s too lazy to learn himself.

      The dumbing down is real.

  14. Tom DeRose stopped listing short-term rental units earlier this year when New York’s new law passed. The 23-year-old engaged in what he calls ‘Airbnb arbitrage’: renting apartments, then listing them on Airbnb despite not living there.

    Die, speculator scum.

    1. Not sure I would call him a speculator, since he’s only renting and not buying the units. At most he’ll have to break a few leases, which isn’t that much money to lose. I guess that’s why he doesn’t seem all that distressed when he stopped listing.

  15. As a result, the company’s market capitalization has dropped below $500 million — a fraction of the $40 billion valuation it once commanded as a private company.”

    It was only Yellen Bux. Wealth predicated on “money” created out of thin air with Fed keystrokes was always an illusion.

  16. RE: ‘I truly wish the Fed would stop raising interest rates because they are clearly overreacting, the overall inflation rate is calming down.’

    Which is the same as a terminally obese person saying “Thank heavens, I am still getting fatter but at a lower rate.”

    Inflation is not a fever, it is a cancer.

    The real cure is a bone-crunching Deflation and a return to honest money which, of course, is never going to happen. In fact, the DunderFed even sets a target for inflation (like the Secret Service setting a target for counterfeiting) because it thinks that (a) Economy means everybody spending everything and living in perpetual debt with the Government setting an example, (b) Saving is a dirty word and (c) free market-driven interest rates must be opposed at all costs . . .

  17. “One is stuck selling a recently purchased, spacious new-build in suburban Fairfield after being required to show up to the office in San Francisco.”

    Are these people that stupid? Gee, you mean I have to someday SHOW UP AT THE OFFICE again? My gosh.

    1. This is a strange situation. Why did they buy a second shack? Could have sold the old one first. Could have rented in Fairfield. Now they got two shacks that are sinking like a turd in a well. Get back to work, you’ve got to pay Montana her whopping commission!

    2. I think all you WFH haterzz should personally drive to Ben’s house to hand deliver your posts. Obviously that would be much more efficient.

        1. It’s not even a comparison, it’s the exact same thing: wasting tremendous amounts of time and energy to do something in person that could be done much more efficiently with available communications technology. But I guess throwing around epithets is easier than reasoning.

      2. Given the bad choice, I’d much rather have a poor English speaking but professional and motivated customer service rep in a Quiet office on the phone than a lazy sullen slag mouthed sofa slumping beech on the phone with children screaming in the background.

      3. WFH is up to the company. If all of these people were more productive and the company were better off with WFH, then there would have been no reason to call them back to the office. Obviously they were not as productive or the company was not running as smoothly with people located all over the country working in their pajamas while taking care of their dogs and cats at home.

        1. There’s plenty of reasons. Wanting to prop up sagging CRE values, backroom favors for the car industry, to name a few. If you really think companies are all about optimizing productivity, I wonder if you’ve ever worked in an office.

  18. China and Japan have a little less appetite for U.S. Treasurys
    Sabri Ben-Achour
    Aug 21, 2023
    In Japan, the weak yen is playing a role in the reduced appetite for U.S. Treasurys. Above, the Bank of Japan headquarters in Tokyo. Tomohiro Ohsumi/Getty Images

    The yield on the 10-year Treasury bond is reaching highs not seen since 2007, and it’s happening just as the U.S. Treasury is issuing more debt more quickly than predicted. One effect is that longer-term debt is becoming more expensive. There are many reasons for this, but one is that some of the folks who usually buy that debt are becoming a little less interested.

    “The Federal Reserve is now reducing their holdings, commercial banks … aren’t growing their assets, they are shrinking their balance sheets,” said Daniel Gerard, senior multi-asset strategist at State Street Global Markets.

    Japan and China may be less interested in Treasurys as well. As foreign countries go, they are big holders of U.S. debt.

    “Two of the biggest — No. 1 and No. 2,” said Josh Lipsky, senior director of the Atlantic Council’s GeoEconomics Center.

    In case you’re wondering, most of our government debt is held domestically; only about 30% is held abroad. But about a third of that is held by China and Japan; it comes out to a little more than $2.1 trillion in U.S. Treasurys.
    …
    https://www.marketplace.org/2023/08/21/china-japan-us-treasuries-debt/

  19. “Bay Area home prices are falling as mortgage rates climb to their highest levels in more than two decades.”

    CR8R

    “In Marin, the median price for detached homes, also called single-family homes, was $1.61 million in July, according to the latest data from the county assessor’s office.”

    Still crazy unaffordable…but perhaps after a few years of above 2% inflation, perhaps the prices will seem perfectly reasonable.

  20. Can’t remember when I’ve seen such a warm reception.

    Will Cain
    @willcain
    People keep asking me what the attitude is of people in Maui toward Biden. I’ve heard numerous times today about the traffic and how locked down the island is before his arrival. There’s also some “disappointment” about how long it took him to come as evidenced by this video.

    https://twitter.com/willcain/status/1693772496384774417?s=20

      1. I suppose this is why his handlers kept him at the house in Delaware. By now no one is paying attention and most of the time on the propaganda news networks is devoted to warmism.

        1. Shots, mystery weekends at private homes, monthly facelifts (really that’s what it looks like), marks from a “CPAP” machine… Seriously how long can they keep this up, medically? I suppose the drugs could keep him going for years. I mean, look at Keith Richards and those people in Kensington/Philly.

  21. ‘Right now the mortgage rates are touching that cyclical high level, I don’t think it will break higher,’

    Relitters will keep saying that until rates finally stop rising.

    1. Wasn’t Yun the one promising that mortgage rates would settle back in the 5s by now? The lie that relitters parroted ad nauseum.

      1. Perhaps if deficit spending was reined in rates might come back down. But as we like to say here, there is a lot of money sloshing around, and that will affect the CPI and other indices.

  22. Risks of buying real estate now.
    -Risk of extreme downward prices and being stuck unable to sell.
    – Risk of tight money market where loan money is tight or to expensive.
    -Risk of lack of mobility if the shit hits the fan by being stuck with real estate.
    – Risk of laws enacted that force bizarre mandates that force assault on property rights.
    -Risk of needing to flee and be flexible.
    -Unstable job market requiring flexible movement.
    – Oppressive or tyranny gov making unreasonable demands on owners.
    -Border invasions and crime making is necessary to move.
    So, just saying being flexible could be prudent in times like these.
    As small business was targeted, so could real estate ownership , remember New World Order says you will own nothing and be happy.
    What if Governments force people to move to 15 minute cities, and condemn vast areas where people live under their emergency frauds.
    Not that the people won’t rebel against this insanity, but being flexible at times like this is advised. You just don’t want to be trapped , at the mercy of these enemies upon us.

    1. What if Governments force people to move to 15 minute cities

      I don’t think they will make you move, just form a 15 minute city where you live now, with checkpoints so you can’t leave without permission.

      I think we will see those in Europe first. Here I expect to see onerous regulations to make our lives worse. Your furnace needs replacing? You’ll have to buy a heat pump, which will be much more expensive to buy and operate. And even if your furnace works, the nat gas or heating oil will be a lot more expensive. New ICE cars will be regulated out of existence via impossible to achieve CAFE numbers.

      1. If the Supreme Court shoots down Chevron deference, then this is going to severely limit the power of the Federal Government:
        https://www.politico.com/news/2023/05/01/supreme-court-chevron-doctrine-climate-change-00094670

        https://www.scotusblog.com/2023/05/supreme-court-will-consider-major-case-on-power-of-federal-regulatory-agencies/

        Giving the Federal Government unlimited power to restrict citizen’s civil rights, livelihoods, movements and personal habits in the name of a “national emergency”, is not written any Federal law or regulation. In fact, it doesn’t even exist within any textbook on infectious disease epidemiology.

        Any restrictions in the future are going to be challenged in court. In the complete absence of data demonstrating that ANY of the Covid-19 mandates had any effect on reducing the rates of death, disease or transmission, it’s going to be hard for any government agency to argue that there is any reason for any mandatory mandates.

        I checked the online Covid-19 death statistics. Covid-19 is HIGHLY correlated with age meaning that as age increases, the number of Covid deaths increases. This means that comparing the crude death rates of Covid between nations or different populations should not be done. This is because the age distribution of countries around the world vary significantly. The answer is a standard procedure done forever called “age-adjusted” death rates. This results in a comparable death rate with the difference in age distribution removed.

        However, if you look around, you won’t find age-adjusted death rates for Covid-19. If you look at all other major causes of death like cancer, heart disease, stroke, dementia etc, “age-adjusted” rates are always presented. The only reason to NOT present age-adjusted death rates for something like Covid-19 is that someone is trying to hide an important statistic, a statistic which would shoot holes in much of the Covid-19 narrative.

        Also, if you look at the cause of deaths in the US which includes the huge number of Covid-19 deaths, there were almost no deaths from influenza and the number of pneumonia deaths was about half that of those attributed to Covid-19. What this means, is that it is almost certain that a lot of the people dying from Covid-19 actually had influenza first. And since testing for
        influenza was not done, it could not be diagnosed. This has always been the case with flu deaths. People don’t die of the flu, they die from secondary pneumonia.

        Since EVERYBODY in every hospital and clinic was getting tested for Covid-19, a very high proportion of people with the flu/pneumonia were also positive for Covid. So the deaths were incorrectly attributed to Covid-19.

        I had not looked at the influenza deaths here in the U.S. over the Covid-19 pandemic and I was surprised at the lack of influenza deaths.

        In other words, the truth has been hidden in plain sight from the people. And since the MSM has no interest in changing the Covid-19 narrative, the facts have been erased.

        1. “the facts have been erased”

          Sounds about right. Globalist scum media is complicit in a medical genocide.

          The Day Of The Rope is coming, for all of you phony journalists and TeeVee talking empty skulls. People like you need to die ☠️

        2. zzy,
          Well, I think the invisible enemy of Covid was faked, and the fake PCR tests were used to promote that there was a panademic by people not sick .
          They could never explain why the flu just disappeared in first year of Covid.
          China was so fake, it isn’t even funny.
          They aren’t going to release a bio-weapon that could kill them. The weapon has to be within control.
          But the whole story of the invisible enemy, that shut down the world, is being hyped up again based on new strain. Any damn symptom they will say is the new mutation of Covid symptoms.
          A lot of people are getting sick, or have died because of those vaccines, so don’t be surprised if the new invisible enemy mutation of Covid has every symptom thats associated with vaccine damage.
          If you were lucky enough to get salt water fake vaccine, or the shot degraded, just don’t take more.

          2. And obesity — and the corresponding diabetes — was just a proxy for a Vitamin D deficiency. Vitamin D is a fat-soluble vitamin, and the excessive fat soaked up so much vitamin D that it was not available to the immune system.

  23. Canada’s Mortgage Rates Surge on Global Pressures
    Mark Mitchell – Mortgage Broker London Ontario
    1 hour ago

    Canada’s fixed mortgage rates are increasing, not only in anticipation of the Bank of Canada rate hike in September, but also global pressure push up bond yields.

    https://www.youtube.com/watch?v=tK1yIzNO5os

    6:49.

      1. To be clear: another 4 years of DJT as P with RFK Jr as VP followed by 8 years of RFK Jr as P.

        1. I feel the same way. Twelve years of outsiders/types that p!sses off the “members of the club” would be glorious. I particularly like that RFK Jr. changes his position as new info dictates. I had no idea he had been addicted to heroin in his youth. Feels strange to say that experience might be a plus.
          Worry about both Trump and Kennedy because of the PTB’s penchant for assassination.
          As a grammar school kid, was just hanging out when word went around the neighborhood that RFK was talking to people a few blocks away. We ran as fast as our little legs could carry us and there he was, standing on top of a car at the entrance of Inwood Park (NYC) talking to a tiny crowd, 25 people tops, security prob there but not obvious. Remember very little more, bc I was a kid and didn’t really care 🤷🏼‍♀️

  26. ‘It would pour more cold water on the office market, which is struggling direly,’ the Columbia Business School professor and real-estate expert added. He recently warned that troubles in the office segment could hammer cities’

    Yeah Stijn, and they did it on purpose.

  27. ‘We expect higher interest rates to keep curbing buyers’ enthusiasm for months to come, while possibly forcing the hand of some current owners to sell’

    Sound lending!

  28. ‘a fire that was reported at 4:30 a.m. on Wednesday, August 2. These Burlington fires follow a string of similar incidents in the Greater Toronto Area. The trend has also hit Ottawa, when an under-construction rowhouse on Esban Drive was swallowed by flames at around 1 a.m. on Tuesday last week’

    Those guys, always grilling weenies in the wee hours.

  29. ‘the housing market may have just entered a nuclear winter,’ says Pryor, ‘estate agents will be offering up their first born child to persuade you to view a property. They’ll send a limo to pick you up and take you there and then beg you to make them an offer. Any offer’

    That’s the spirit Henry, outstanding!

  30. ‘SBB’s bonds have long been trading at distressed prices, reflecting junk-grade rating levels. Its shares have lost more than 90% of their value since the start of last year’

    I’ll have a blue Christmas without you
    I’ll be so blue just thinking about you
    Decorations of red on a green Christmas tree
    Won’t be the same, dear, if you’re not here with me
    And when those blue snowflakes start fallin’
    That’s when those blue memories start callin’
    You’ll be doin’ all right with your Christmas of white
    But I’ll have a blue, blue, blue, blue Christmas
    You’ll be doin’ all right with your Christmas of white
    But I’ll have a blue, blue, blue, blue Christmas

  31. ‘I was disappointed, I’d held hope for 12 months that the company was generally reasonable and would honour their word,’ he said. ‘When they liquidated I knew then I wasn’t going to get my money’

    Acceptance <- Kyle you are here.

  33. ‘The China property sector is like a black hole, so many developers have been dragged into it since two years ago after Evergrande…The central government has yet to introduce (strong) measures because this is too large a hole to fill’

    This is how China builds cities Alan, Dan told us so.

  34. $136,000 Price Drops Are Coming, Probably More! 2023 Canadian Real Estate Market
    Jon Flynn Broker of Record, Flynn Real Estate Inc.
    2 hours ago

    The Data doesn’t lie! This week I drill down on Canadian real estate prices and where they will most likely end up in the near future using basic fundamentals and chart patterns including fibonacci retracements, mean reversion, head and shoulders, household income to house price ratios, and inflation data.

    https://www.youtube.com/watch?v=cnz6kfyuApY

    15 minutes.

  35. Shanghai Has Changed Forever Since The Lockdown (#156)
    Sabbatical
    3 hours ago

    In early 2022, Shanghai went into lockdown. Residents were told it would last for a few days; in the end, it lasted almost 3 months. It would have an unmistakable impact on the people of the city.

    After more than a year and China’s reopening, it’s noticeable that things have changed. I myself had lived in Shanghai for years before the pandemic, but was locked out of the country when China closed it’s borders in 2020. It was a strange feeling to return to what I had left behind.

    Join me on this walk around China’s biggest megacity, a city I had lived in and loved. Let me try and give you a glimpse of what it was like, through my eyes.

    https://www.youtube.com/watch?v=REKsv057pIk

    21 minutes.

  37. Review gets it right: Military vaccine mandate violated the Charter!
    Canadian Constitution Foundation
    4 hours ago

    In this video Christine outlines a decision of the Military Grievances External Review Committee that found the vaccine mandate for the Canadian Armed Forces was unconstitutional.

    https://www.youtube.com/watch?v=lVB1ba6UtKk

    16 minutes.

  38. U.S. Markets
    Dow, S&P 500 end down as US interest-rate worries mount, bank shares slip
    By Caroline Valetkevitch
    August 22, 2023 3:34 PM AKDT
    Updated 2 hours ago

    – Nvidia hits record high before turning negative

    – Big U.S. banks fall after S&P downgrades regional lenders

    – Indexes: Dow down 0.51%, S&P 500 down 0.28%, Nasdaq up 0.06%

    NEW YORK, Aug 22 (Reuters) –

    The Dow and S&P 500 ended slightly lower on Tuesday as investors stayed worried the Federal Reserve will keep interest rates higher for longer and as banks shares eased.

    The Nasdaq finished barely in the green.

    The financial sector fell 0.9% and was the biggest drag on the S&P 500. An S&P downgrade of credit ratings of multiple regional U.S. lenders weighed on banks shares, with the KBW regional banking index sliding 2.7% and the S&P 500 banks index falling 2.4%.

    Investors hope for clarity on the rate outlook when Fed Chair Jerome Powell speaks at a meeting of central bankers on Friday in Jackson Hole, Wyoming.

    “Rates have backed up pretty good again, so that’s kind of putting somewhat of a damper on stocks,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

    The benchmark 10-year Treasury yield hit almost 16-year highs overnight on the view the Fed could keep rates higher for longer. Higher borrowing costs can slow spending by businesses and consumers.
    …
    https://www.reuters.com/markets/us/nvidia-earnings-optimism-drives-futures-higher-2023-08-22/

    1. Markets
      CNBC TV
      Real Estate
      Mortgage rates hit their highest point since 2000
      Published Mon, Aug 21 2023 12:54 PM EDT
      Updated Mon, Aug 21 2023 2:51 PM EDT
      Diana Olick

      WATCH LIVE
      Key Points

      – Mortgage rates soared to the highest level since November 2000, crushing affordability for potential homebuyers.

      – The average rate on the popular 30-year fixed mortgage hit 7.48%, according to Mortgage News Daily.

      – The average on the 30-year fixed last year at this time was around 5.5%.
      …
      https://www.cnbc.com/2023/08/21/mortgage-rates-hit-highest-point-since-2000.html

    2. Mortgage rates skyrocket across the country amid high inflation
      By Adriana Doria
      Published: Aug. 22, 2023 at 2:24 PM AKDT|Updated: 3 hours ago

      CHARLESTON, W.Va. (WSAZ) – People all across the county are still grappling with post-pandemic inflation facing our economy, especially incoming or current homeowners — with no end in sight.

      “In early spring last year, interest rates for a 30-year mortgage were well below 3 percent and, in the year and a half since then, rates have gotten to where they are now — well above 7.5 percent or even 8 percent depending on where you get your loan from, what your qualifications are,” said Jon Rogers, Senior Division Director for Single Family Lending at the West Virginia Housing Development Fund.

      Mortgage rates all throughout the U.S. have skyrocketed — posing challenges to the housing market and the economy, and these high mortgage prices are not going away anytime soon.

      “If you are out there just shopping around, you’re going to see rates through the sixes through next year, is what everyone is predicting that seems to know,” Rogers said.

      Some might be skeptical to buy houses now with the high mortgage rates, but Rogers said in the state and through the Housing Development Fund, West Virginians are continually buying and their sales at the fund doubled in the last year helping first time home buyers become homeowners.

      “Don’t try to plan your mortgage, housing situation around the country’s macroeconomics because you’ll lose unless your a very experienced economist. You won’t get the lowest interest rate ever existing, and you will end up with a lot of frustration,” he said.
      …
      https://www.wsaz.com/2023/08/22/mortgage-rates-skyrocket-across-country-amid-high-inflation/

    3. CNBC
      Daily Open: When yields are this high, why buy stocks?
      Published Tue, Aug 22 2023 7:53 PM EDT
      The US Treasury building in Washington, DC, US, on Tuesday, Aug. 15, 2023.
      Nathan Howard | Bloomberg | Getty
      …
      Now’s the time to buy duration
      The U.S. 10-year Treasury yield’s at the highest level since 2007. While that means lower bond prices — since prices drop as yields rise — Charles Schwab thinks now’s a good time for traders to add to their fixed income portfolio.

      The bottom line

      At 4.332%, the 10-year Treasury yield’s at its highest in 16 years. That represents a risk-free, long-duration asset with relatively high returns, weighing on the stock market. The logic is: Why should traders invest in stocks that may not return as much, or just slightly more, when there’s an asset class that guarantees a 4% return?

      As Rupert Thompson, chief economist at Kingswood Group, told CNBC, “Cash is now yielding 5% in the States, short-dated bonds are yielding 5% plus, so equities for the first time in a long time have actually got some real competition.”

      Typically, stocks — if they do well — tend to return more than a risk-free asset, precisely because it isn’t certain stocks will rise. That’s called the equity risk premium, a return that’s supposed to compensate stock investors for the chance that they might lose money. But, as CNBC Pro’s Bob Pisani notes, the premium is below 1% now. Historically, it’s been between 2% and 4%. In other words, stocks are looking much less attractive than Treasurys.
      …
      https://www.cnbc.com/2023/08/23/stock-markets-when-yields-are-this-high-why-buy-stocks.html

    4. Wall Street is declaring victory too early — the US is still headed for a recession
      A Bull’s eye with a downward red arrow and flames reflecting from it
      Tyler Le/Insider
      William Edwards

      There’s a saying in markets that being early is being wrong. Given that maxim, it’s fair to say that over the past two years pessimistic economists and market analysts have been wrong.

      Bearish forecasters began to warn of a recession and corresponding stock-market selloff as early as April 2022. Take, for example, an October 2022 Reuters poll in which 65% of the economists it surveyed said a recession would arrive in the following 12 months. Things were supposed to get ugly, and soon.

      Fast-forward to today and the sun is still shining on the US economy. Unemployment is below 4%, inflation is sliding, consumers are still spending, and the S&P 500 rallied as much as 20% this year before cooling off recently. And GDP is projected to grow by 1.6% in this third quarter, economists surveyed by the Philadelphia Fed said. Hardly recession material.

      Optimistic, bullish economists are of course relishing the opportunity to say “I told you so,” as consensus starts to bend toward their view that the economy will achieve a soft landing — lower inflation without the need for an economic shock like a recession. Economists at Bank of America and JPMorgan now say a recession will not happen this year, or perhaps at all.

      But just because the economy’s flight path seems gentle now doesn’t mean that there won’t be turbulence ahead. According to top Wall Street strategists and economists I’ve spoken with in recent weeks, there’s plenty of evidence that a recession is on the way. In other words, bulls are declaring victory far too early.

      “To say today that we’re going to have a soft landing is so premature,” Michael Kantrowitz, the chief investment strategist at Piper Sandler, told me. “History tells you you really can’t make that assessment.”
      …
      https://www.businessinsider.com/us-economy-still-headed-for-recession-stock-market-crash-2023-8

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