Whatever The Asking Price Was, It Got Escalated. By Contrast Many Sellers Now Are Cutting Prices
A weekend topic starting with Newsweek. “Last month, Fed Chair Jerome Powell and policymakers suggested the federal funds rate would stay above 5 percent through next year and could begin to come down to a little under four percent in 2025 and drop to 2.9 the following year. ‘The fast-rising interest rates are breaking several sectors of the economy,’ said Lawrence Yun, chief economist at the National Association of Realtors. ‘The remaining sectors will also likely crack if the rate hikes continue.'”
From CBS News. “While the Fed does not directly dictate mortgage rates, it generally influences the real estate market. Rates might not get back to their pandemic lows. While rates might seem high now, they look more reasonable from a historical perspective. ‘Buyers got used to perpetually — and artificially — low interest rates. For the time being, believe this to be the new normal. I do not think we will see those artificially historic low rates in the near future,’ says Nikki Beauchamp, licensed associate real estate broker at Engel & Völkers.”
From Bloomberg. “Not so long ago, families, businesses and governments were effectively living in a world of free money. The US Federal Reserve’s benchmark interest rate was zero, while central banks in Europe and Asia even ran negative rates to stimulate economic growth after the financial crisis and through the pandemic. Those days now look to be over and everything from housing to mergers and acquisitions are being upended, especially after 30-year US Treasury bond yields this week punched through 5% for the first time since 2007. Yields got another boost on Friday after bigger-than-expected surge in US payrolls that bolster the case for more Fed rate hikes. And there’s a lot of debt out there: According to the Institute of International Finance, a record $307 trillion was outstanding in the first half of 2023.”
“Johanna Kyrklund, co-head of investment at Schroder Investment Management, likens the bond selloff to the bursting of the dot-com bubble two decades ago, when some ‘fundamental assumptions had to be revisited.’ ‘The same has happened with the bond market,’ Kyrklund said. ‘New ranges are required and the last two years have been about bond investors getting used to that fact and accepting that we’re not going back to what was true the last 10 years.'”
From The Hill. “There has just been a landmark event at the Federal Reserve: Its accumulated operating losses have passed $100 billion. This startling number, which would previously been thought impossible, was reported on Sept. 14, 2023, in the Fed’s H.4.1 Release. It is essential to understand that these are not mark-to-market paper losses; they are real cash losses resulting from the Fed’s expenses being to this remarkable extent greater than all its revenue. These are equally losses to the U.S. Treasury and thus costs to the taxpayers; nonetheless the Fed keeps officially insisting that its losses don’t matter. (Meanwhile the Fed’s mark-to-market losses are more than $ 1 trillion in the most recent public report.)”
The American Enterprise institute. “Mr. Furman excuses the Fed’s unprecedented losses, which have surpassed $100 billion on their way to $200 billion or more, suggesting taxpayers shouldn’t care. To the contrary, taxpayers should care that the Fed will spend, without authorization, $200 billion or more that will be added to their future taxes. These Fed losses are the result of a radical and exceptionally risky Fed choice to build a balance sheet resembling a giant 1980s savings and loan. In the process, it stoked bubbles in bonds, stocks, houses and cryptocurrencies, in addition to inducing enormous interest-rate risk in the banking system. Those risks have now come home to roost.”
“Mr. Furman argues that the Fed’s negative capital position doesn’t matter. If so, why cook the books to avoid reporting it? The Fed books its cash losses as a ‘deferred asset’ so that it can obscure its true negative capital position. The Fed changed its own previous accounting rules precisely so it could do so. We know what would happen if Citibank tried that. Who authorized the Fed to take an enormous interest-rate bet, risking taxpayer money? Nobody but the Fed itself. Does ‘independence’ give the Fed the right to spend hundreds of billions of taxpayer dollars without congressional approval? That question needs to be debated.”
From Fox 4. “As housing prices continue to climb, attainable housing sites are popping up all over Southwest Florida. Lauren Apicella, Realtor with eXp Reality, says her Naples customers are typically cash buyers. ‘Our median sales price is at $625,000,’ said Apicella. ‘What’s amazing is in the last three years, we’ve grown over 60%, so home prices have just exploded down here.'”
From Fox News. “Homes within the cities of Allentown, Bethlehem and Easton in Pennsylvania have seen the largest price increases between August 2019 and August 2023, according to Realtor.com chief economist Danielle Hale. Homes in the aforementioned areas saw prices jump nearly 74% over the past four years, according to Hale. Close behind was Knoxville, Tennessee, where home prices rose 62.7%. In Cape Coral and Fort Myers, Florida, there was an appreciation of 62.6% over the past four years, according to the data. Prices for homes in Boise, Idaho, as well as in Portland and South Portland, Maine, also saw some of the biggest price gains in recent years. ‘These five areas have experienced the greatest price change in the last four years, which suggests that there have either been significant economic changes to support higher prices or the run-up is potentially unsustainable,’ she said.”
From France 24. “Soaring costs across the EU are pricing out renters, deterring prospective buyers and preventing new homes from being built. As Europe’s housing crisis grows, so do homelessness rates across the bloc. What are the solutions to Europe’s housing crisis? Confidence in the market is low. Real estate was the most distressed sector in Europe in 2023, suffering from the highest levels of financial uncertainty, volatility and an increase in perceived risk, according to a study from Weil, Gotshal & Manges, a global legal advisory firm. Avoiding crises-induced peaks and troughs that rock the market may require a change in approach in some countries and cities, said Diana Yordanova, communications director of Housing Europe. ‘In many countries, housing has been considered as an asset and it’s very often being used for speculation or for investment.'”
The Aldergrove Star. “The benchmark price – the average price for a ‘typical’ home – was $1.63 million in Langley in September. That’s 0.1 per cent below where it was in August. The relatively small movements in prices over the last few months have been a brief pause in a real estate market that has experienced wild swings over the last several years. Although locals have complained about real estate prices for years, the COVID-19 pandemic saw a massive spike in prices, especially for single family homes. At the start of 2020, benchmark prices in the Fraser Valley for single family homes hovered at just under $1 million. By 2022, they had peaked at almost $1.8 million. Then interest rate increases from the Bank of Canada, intended to curb inflation, caused mortgage interest rates to spike. That led the benchmark rate to fall as far as $1.35 million, before it began to climb again. The benchmark in September for the region was $1.52 million.”
Mansion Global. “Soaring interest rates in Canada—and some pandemic-related buyer’s remorse—are calming the cottage market in rural Ontario, giving buyers the upper hand after three frenzied years of nonstop price increases. ‘The market was chaotic during the pandemic,’ said Pauline Aunger, a real estate agent with Royal LePage in Smiths Falls, Ontario, near Ottawa. ‘There were so many people trying to escape into recreational real estate. Whatever the asking price was, it got escalated.’ By contrast, many cottage sellers now are cutting prices, said Max Hahne, a broker at Engel & Völkers Collingwood Muskoka, whose territory includes the sought-after cottage country about 100 miles north of Toronto. ‘These are secondary properties. There’s no longer that urgency,’ Hahne said. ‘So there’s a softening of the market. And this is a window of opportunity for new buyers.'”
“Many sellers are also recent transplants experiencing buyer’s remorse—an advantage for cottage shoppers, according to John Fincham, an agent at Re/Max Parry Sound Muskoka Realty. ‘People tried cottage living. Some haven’t liked it. Now they want out. There are absolutely motivated sellers. So you can get more bang for the buck,’ he said. Some buyers who panic bought during the pandemic also neglected due diligence on their home’s location, Fincham said. ‘They don’t know the lake they’re buying on, and they go for the structure as opposed to the lake or the lot,’ he said. ‘There are lakes that fluctuate 12 feet from high to low water. It might have looked perfect when you bought in August, but you’d spend a third of the next summer flooded. A lot of sales are motivated by just that. These are the sellers taking it on the chin.’ Many sellers of cottages ‘have not come into line with the realities of the market,’ he said. ‘I have neighbors who bought a cottage for C$1.4 million at the peak of the market. In 60 days, they haven’t had one showing.'”
“The combination of motivated sellers and patient buyers has led to price reductions up to ‘hundreds of thousands of dollars for multimillion-dollar properties,’ said Hahne of Engel & Völkers. ‘I had a listing for C$3.3 million (US$2.44 million) that dropped to C$3.145 million, then finally sold at C$2.7 million,’ he said. ‘The owner had moved to be with her son, so the home was empty. The buyer, in England, played hardball. He knew he was no longer in a competitive situation.'”
“And though a July headline in the Toronto Star blared that Ontario cottage prices have crashed, some brokers say the ‘crash’ may be overstated. ‘That’s not a fair assessment,’ said Mike Kearns, an agent with Royal LePage Locations North in Collingwood. ‘You may see prices pull back further in more rural areas further from the lakes. But in popular areas like Collingwood, Craiglead and Thornbury, all of which offer waterfront, the most I would say is a softening.’ Prices have eroded about 20% from the market peak, he added. ‘So we’re below the absolute top of 2022, but still way up from 2019, which was pre-covid. We saw unprecedented appreciation during that time.'”
The Globe and Mail. “In July, 2020, Bank of Canada Governor Tiff Macklem assured Canadian households that borrowing rates were very low and would stay that way ‘for a very long time.’ And by all appearances, it looked like he would be right. As banks offered ultralow mortgage rates, the real estate market roared back to life as a number of Canadians decided to buy their first home, upgrade to a better one, or buy a second home in cottage country. Then, as global supply chains struggled to keep up with sharply rising demand for everything from lumber to lettuce, inflation took off, eventually reaching levels not seen in decades. The Bank of Canada was forced to take action.”
“That’s left homeowners looking for any way to cope. Many are lengthening their mortgage amortization, stretching out the duration of their payments from 15 or 25 years to 30 years or beyond to keep their payments down to manageable levels. ‘A few years ago, people were refinancing because they wanted to buy a rental property,’ said Elan Weintraub, a mortgage broker. ‘Now, they’re doing it just to stay afloat.'”
“Owen Hewitt’s mortgage keeps him up at night. In May of 2022, he and his wife, Gabrielle Hewitt, bought a house in Ottawa for around $630,000, locking in a fixed-rate mortgage at 2.9 per cent. The couple pays $2,600 monthly. Though the term won’t be up for another three and half years, Mr. Hewitt is concerned that their mortgage payment will jump when they renew. ‘I have lost sleep about having our mortgage eat our income, and the value of our house not keeping pace at all,’ said Mr. Hewitt, 39. ‘We both work, have great careers and have no kids, and it still feels like we’re in danger of going underwater with one really bad month. I personally have some anxiety about whether I’ve made a choice to have a house over being able to retire. Inflation made it worse.'”
“In November, 2019, personal injury lawyer Jasmine Daya purchased a three-storey commercial property in the Yorkville area of Toronto for her company, which occupied two floors, and quickly found tenants for the other floor. She signed a three-year fixed mortgage at 5.49 per cent. Ms. Daya also owns several bars and nightclubs in the city and has other mortgages. Then came the pandemic, and as court hearings came to a halt, her business slowed and her employees stopped coming into the office. Her tenants kept paying their bills, but they, too, weren’t coming in. ‘I was sitting in this empty building, not even with the lights on, and I was like, ‘What have I done?’ Ms. Daya said.”
“When her mortgage came due last fall, Ms. Daya signed a one-year mortgage at 7.92 per cent. This added an additional $6,000 to her monthly payments, bringing them to $31,000. A key tenant did not renew earlier this year and Ms. Daya has not been able to find a new one. Ahead of the looming mortgage renewal next month, Ms. Daya has put her office on the market. She listed the property for sale earlier this year and in mid-September, dropped the price by $1.5-million to $6-million. ‘It’s not a great time to sell. But I think that’s my best option, rather than struggling every month,’ Ms. Daya said. The uncertainty about the situation ‘is definitely anxiety inducing.'”
The Mises Institute. “In 1996, we produced a documentary titled Money, Banking, and the Federal Reserve. For the next ten years, we distributed copies all around the world, to our students, our members, and the public. Thousands of people were introduced to the evils of the Fed and central banking. Of course, a lot has changed since 1996. The Federal Reserve has seized numerous new powers and prerogatives, and the US economy has endured three more recessions, a major financial crisis, and forty-year highs in inflation. Another recession appears to be on the horizon, and much more inflation, too. Now is the time to create a new documentary that explains how the Federal Reserve continues to wreak havoc in the modern economy. It’s almost as if Fed economists want to impoverish us.”
“The documentary will expose the Federal Reserve for what it really is: an enormous threat to prosperity, peace, and freedom. The Fed steals from the vast majority and gives to the corrupt few. The Fed makes it possible for the regime to wage endless wars. It’s a reason the government has grown to massive proportions. It threatens the livelihood of future generations. And ours, too. It’s a reason civilization is in decline.”
“The Federal Reserve’s balance sheet quintupled in size after the 2008 financial crisis. And the Fed caused that crisis. Perhaps intentionally. Since then, the money supply has grown by more than $12 trillion. Half of that was printed in just the last three years. The Federal Reserve’s reckless money printing was touted as creating financial stability, yet Silicon Valley Bank, Signature Bank, and First Republic Bank still failed. Many more are on the same path.”
“The Federal Reserve constantly moves its own goalposts. Remember how Fed economists declared that inflation would be ‘transitory’ but then said we needed to ‘retire the word ‘transitory’ just a few months later? We need to retire the whole system, if you ask me. Politicians tell us that we need more regulation to fix the Fed. What we need is to abolish the Fed. The ‘experts’ tell us that the Fed is our protector. Ha! It only protects the state, big banks, and their cronies. This is why we need to set the record straight. We cannot let the Fed be its own judge. We cannot let the financial news media paint a rosy picture of the government’s counterfeiting machine.”
From The Hill. “Referencing data that showed optimism about the economy often peaks before a downturn hits, Bloomberg pointed to 2007 comments from Janet Yellen, then serving as San Francisco Fed President, in which she predicted a soft landing two months before the beginning of the Great Recession. Last month, Yellen, now the Treasury Department secretary, said she is ‘feeling very good’ about the U.S. making a soft economic landing without a recession.”
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‘Mr. Furman argues that the Fed’s negative capital position doesn’t matter. If so, why cook the books to avoid reporting it? The Fed books its cash losses as a ‘deferred asset’ so that it can obscure its true negative capital position. The Fed changed its own previous accounting rules precisely so it could do so’
Making up yer accounting rules as you go, eh Jerry? Good thing yer running a lemon aide stand instead of a bunch of crooks with a 2 billion peso annual salary.
BTW this is a letter to the editor that was in the WSJ apparently. So I don’t know who Furman is, they didn’t link to the original piece.
I think this is the original from late Sept: https://www.wsj.com/articles/profits-and-losses-dont-matter-at-the-federal-reserve-859f6254
Don’t said losses cut into the US Treasury cut on the scam?
‘At the start of 2020, benchmark prices in the Fraser Valley for single family homes hovered at just under $1 million. By 2022, they had peaked at almost $1.8 million. Then interest rate increases from the Bank of Canada, intended to curb inflation, caused mortgage interest rates to spike. That led the benchmark rate to fall as far as $1.35 million, before it began to climb again. The benchmark in September for the region was $1.52 million’
Yer running a real mickey mouse operation up there Tiff.
‘A few years ago, people were refinancing because they wanted to buy a rental property…Now, they’re doing it just to stay afloat’
Golly Elan, I hope no one overpaid in such an environment.
it still feels like we’re in danger of going underwater with one really bad month. I personally have some anxiety about whether I’ve made a choice to have a house over being able to retire. Inflation made it worse’
‘I was sitting in this empty building, not even with the lights on, and I was like, ‘What have I done?’…It’s not a great time to sell. But I think that’s my best option, rather than struggling every month,’ Ms. Daya said. The uncertainty about the situation ‘is definitely anxiety inducing’
Owen, Jasmine, Tiff broke it off in yer a$$.
World Economic Forum (WEF) founder Klaus Schwab is a “globalist terrorist” who is “holding humanity to ransom”, according to Russian President Vladimir Putin who warned the elite that their New World Order has failed and their “days are numbered.”
Russian President Vladimir Putin delivered a speech on October 5 at the plenary session of the 20th meeting of the Valdai International Discussion Club in Sochi and emphasized the tectonic and irreversible shifts taking place in the global order.
According to Putin, globalists including Schwab and his close advisors are “legitimate military targets” because they have been actively attempting to seize power illegally via a globalist coup d’etat.
https://ussanews.com/2023/10/05/putin-warns-globalist-terrorist-klaus-schwab-his-days-are-numbered/
+1
“legitimate military targets”
I never claimed that Putin was a good person, but if anyone is deserving of being poisoned with radioactive material, it is Schwab.
Let him die slowly, of radiation induced cancer. This man is the enemy of all humanity.
According to Putin, globalists including Schwab and his close advisors are “legitimate military targets”
I doubt Putin will make good on that threat. Still, it’s nice to imagine the WEF honchos sweating while they stay out of the public eye.
A reader sent these in:
T-bills are paying 5.5% risk free, meanwhile, stocks are yielding 1.5% with end of cycle risk. Let’s draw a picture to help bulls understand:
https://twitter.com/SuburbanDrone/status/1709554172410921169
Switzerland 🇨🇭 is banning Electric Cars due to their excessive energy use… Let That Sink In 🤡 🎪.
https://twitter.com/Raymond82310289/status/1709136047156699239
Perfect doom loop: Yields keep rising cause they need to issue so much debt above plan. And they need to issue so much debt cause higher yields have resulted in escalating higher interest payments on debt.
So they need to issue even more debt which causes yields to rise even higher causing ever larger interest payments resulting in ever more debt needed to be issued which causes even higher yields and so on. Eventually ever rising yields would lead to a complete bust. They’re trapped & need lower yields to get out of the doom loop. All roads lead to intervention.
https://twitter.com/NorthmanTrader/status/1709254206379454938
The Fed’s unemployment projections:
2024: 4.1%
2025: 4.1%
2026: 4.0%
That is remarkable for a crew that just hiked rates by 525bps, especially since the Fed’s own senior loan officer survey shows a net 39.4% of banks tightening credit. That points to rising unemployment.
https://twitter.com/JeffWeniger/status/1709716277693125005
I keep having to change the axis on the mortgage interest chart because it goes up, then up more, then up more. What happened this month? You guessed correctly. Up more.
https://twitter.com/JeffWeniger/status/1709686078645698564
With mortgage rates at 8%, this chart is worrisome. A full 0.94% of the US labor force is a member of the National Association of Realtors.
https://twitter.com/JeffWeniger/status/1709328643975970875
A $400,000 house now costs over $1,000,000, with interest rates now at 7% from 3%
https://twitter.com/WallStreetSilv/status/1709807079630737870
This guy walking around Costco shares examples of food inflation that are WAY higher than the numbers reported for food inflation by the government. 🔊 … 😡 Overall, many people know intuitively that food inflation is way higher than the official number of 4.3% from August 2022 thru August 2023. This video shows some of the examples he is seeing.
https://twitter.com/WallStreetSilv/status/1709600614131380230
Healthy economy:
Net worth top 0.1%: $18.6 trillion
Net worth bottom 50%: $3.6 trillion
Household count in the top 0.1%: 132,262
Household count in the bottom 50%: 66,050,020
https://twitter.com/NorthmanTrader/status/1708913178703229144
FED’S POWELL: THE FED’S FOCUS IS ON A HEALTHY ECONOMY.
https://twitter.com/financialjuice/status/1708861410002817517
Good Morning from #Germany, where the construction sector is really crashing. The German PMI Construction Index fell to 39.3 in Sep from 41.5 in Aug, and the lowest level since statistics began.
https://twitter.com/Schuldensuehner/status/1709837268876165166
World’s biggest bond markets hit by heavy selloff: Bond yileds hit post-crisis highs around the world: US 30y yields hit 5% before retreating. German bund yields hit 3%. Bond rout sounds alarm bells globally.
https://twitter.com/Schuldensuehner/status/1709624227010158734
Something is breaking in financial markets. 10y yields have jumped by 150bps in the US and 80bps in Germany. Yield curve has bear-steepened to a more normal level. Getting used to a more typical rate structure doesn’t sound like such a terrible thing. But after 15yrs of living in an unnaturally low rate regime, normal sounds, well, abnormal.
https://twitter.com/Schuldensuehner/status/1709546067237204009
3M is down 58% from its peak in 2018, the largest drawdown in the company’s history.
https://twitter.com/charliebilello/status/1709917329381785796
The US National Debt has now increased by over $2 trillion since the debt ceiling was suspended just 4 months ago.
https://twitter.com/charliebilello/status/1709762386180137255
Mortgage purchase applications in the US have fallen to their lowest level since 1995. The average American household simply cannot afford the average home price at current mortgage rates (7.7% for 30-year fixed).
https://twitter.com/charliebilello/status/1709574105677107442
The average price of a used Tesla has declined 14 months in a row, moving from a record high of $67,900 in July 2022 to a record low of $40,570 today (-40%).
https://twitter.com/charliebilello/status/1709335565189914989
Used Car prices moved lower in September for the 4th straight month. Prices are 7% below peak levels in July 2022 but still 26% higher than where they were at the start of 2021.
https://twitter.com/charliebilello/status/1709334493276852283
2006, I was working for New Century Mortgage (big short ref). We found a house in a nice neighborhood, but near a rough part of town. The market was HOT. “California is moving here! “Arizona is the next California!” “Buy now or be priced out forever!”
So we made an offer and they accepted! It was market priced, $245,000. Felt like a lot, we were making around $125,000/yr combined and it was all we felt like we could afford.
We liked the house, but the area was a nightmare. Not where we wanted to be. Gunshots almost nightly, AR15 automatic went off down the steet.
2007 rolls around and the housing market stalls and New Century credit lines freeze. I’m on the phone fielding angry call after angry call. One of my brokers (VERY nice lady) was in tears as a family was moving from out of town and no one else would do their loan. It was set for funding and no one could get payments out. I knew I wasn’t getting anything but somehow I got it to fund and the family could move in.
Then I turned off my phone with a message saying “New Century was in a blackout period.”
New Century was SURE they would be bought so they did rounds of layoffs. I survived until the last round (I never wanted to go back anyway).
New Century declared BK and I took a job at Edward Jones in their management training program. It was great at first, until I was “promoted” to a Team Leader.
October 2008 hit and it was a DISASTER. Their piece of shit trades review system was setup review say 10,000 transactions a day and they got 200,000. System broke and all the people there for 20+ years put the responsibility on me and my team to fix it. My life spiraled into 70+ hour weeks, unpaid overtime AND I was making terrible money, less than $50,000/yr.
I was also studying for the Series 7 so I was getting 4 hours of sleep per night at best. Stress and underlying issues wrecked my relationship and she moved out. She also lost her job and started making way less money.
Ok we’ll sell the house as neither of us could afford the payment on our own. Problem? It was worth less that what we paid. The lender didn’t give a shit so we decided to short sell.
I moved to a MUCH nicer part of town while the home was being sold. I just didn’t want to be there any more. Rent? $750/mo down from $1300. HALF my mortgage payment.
The house did end up selling for $100,000, $145,000 LESS than what we paid. The price didn’t recover until 2019.
https://twitter.com/GRomePow/status/1709959577138352236
Bank of America & Citi both making new 52-week lows today
https://twitter.com/JackFarley96/status/1709983928520474776
Banks’ unrealized bond losses estimated to hit a new record $700 billion in Q3 due to this massive yield spike. Bank stocks are now trading inversely to bond yields, something that’s never happened before. The blood is in the water.
https://twitter.com/SuburbanDrone/status/1709975549823615238
This cannot be right, CNBC is telling us that 13% treasury yield is coming.
https://twitter.com/MichaelAArouet/status/1709892724638302513
More price cuts at Tesla. This time the Model Y. We are witnessing the most aggressive velocity of price cuts ever conducted by a car company. For better or worse, there will be casualties left behind.
https://twitter.com/GuyDealership/status/1710136778823291147
If stocks were down over 50% everyone would be losing their mind. But long bonds are down over 50% and everyone is super chill. Why do you think that is?
https://twitter.com/MebFaber/status/1709935892616691867
Burnout Economics in the U.S summed up in 2 charts. Overall bank credit contracting, with this only the 2nd instance in history, the other being the GFC. Meanwhile, the U.S federal govt is running a deficit of 6% of GDP despite recent record low unemployment.
https://twitter.com/AvidCommentator/status/1710077849137533346
Each year $108bn is inherited in Australia & 67% of household wealth stems from property. Add to that $92bn a year in equity mate, that is a sizable proportion of household consumption potentially stemming from property. In many ways housing prices are the economy.
https://twitter.com/AvidCommentator/status/1709778749397586299
Pretty notable slowing in implied US gasoline demand in the last couple weeks to seasonal levels below ’20. In line with rapidly slowing credit card data, suggests maybe economy slowing pretty quickly here. Maybe chop, but keep an eye on it as a timely measure.
https://twitter.com/BobEUnlimited/status/1710010717972398211
Companies cut employees only when demand indications soften, which is why employment lags. ADP isn’t a great for predicting payroll figures, but it is a real data triangulation. Notable how big firms have been cutting recently. Suggests weak 3Q and 4Q earnings seasons coming.
https://twitter.com/BobEUnlimited/status/1709980015473856596
Getting inflation durably back to the Fed’s 2% mandate requires a slowing of wage growth which requires softening labor markets. With the Fed done at this point, the path to get there is lower asset prices:
https://twitter.com/BobEUnlimited/status/1709949313202167823
The drop in NFP Private Sector Services Employment – Leisure and hospitality NSA is now tracking 2008… That was not the case until July. Sep 2008 was a full blown recession though.
https://twitter.com/INArteCarloDoss/status/1710291277768458590
Home buying conditions have plummeted. Reaching levels seen only once since 1960. Back then, it ended in a severe recession.
https://twitter.com/GameofTrades_/status/1710346681341132883
Is being stupid a new trend?
https://twitter.com/lord_fed/status/1710398821472076168
“Reader” has given us crater overload this morning. I’m swooning! Too…..much…..crater….
“Household count in the top 0.1%: 132,262”
Most of these people are non-productive Parasite Class, they create nothing.
They are blood sucking parasites, and BTW, stereotypes exist for a reason. 6,000+ years of history doesn’t lie.
“The average price of a used Tesla has declined 14 months in a row, moving from a record high of $67,900 in July 2022 to a record low of $40,570 today (-40%).”
😂😂😂🤣🤣🤣😂😂🤣🤣
Switzerland 🇨🇭 is banning Electric Cars due to their excessive energy use… Let That Sink In 🤡 🎪.
From the link:
So the Swiss greens are going to phase out 30% of their energy, which is carbon neutral.
At least they understand that there won’t be any juice for electric cars.
With mortgage rates at 8%, this chart is worrisome. A full 0.94% of the US labor force is a member of the National Association of Realtors.
If they hurry, they might be able to snag a job stocking shelves at WalMart!
During the last bust I saw many of our local realtors working at Lowes and Home Depot. I’m sure the apps are starting to pour in.
“Is being stupid a new trend?”
(No, there is nothing new about it. Go here…)
“Are you paying 100% Interest?”
https://www.linkedin.com/pulse/you-paying-100-interest-komal-vij#:~:text=When%20you%20buy%20%2D%20one%20part,the%20cost%20(Zero%20Equity).
“As per the economists – buying a home can be 45% cheaper although many renters believe it cost less than to buy. When you buy – one part of your monthly mortgage payment goes towards paying off the mortgage (building equity) and one part towards Interest portion whereas when you rent – 100% goes towards the cost (Zero Equity).
“In Homeownership – the cost of interest paid during the term (Prime Rate 3.95%) is the cost of borrowing (Non Refundable) but if you are renting you are paying 100% Interest for sure.”
CNBC is telling us that 13% treasury yield is coming
Rick Santelli warns the Fed is running out of tricks as he charts the path of higher yields (6m44s)
One of the points I take from that is that people are nowhere near being ready for what’s about to happen. QE and ZIRP for too long have messed folks up.
13% treasury yield
It really doesn’t matter. Economic disaster is guaranteed by the reckless plunge into debt and speculation. We all know that here (sorry SCDave).
With the level of debt everywhere so high, and defaults stacking up, interest rates should be really high. I doubt the Fed has enough power to hold back that tide.
Hamas launches a surprise attack on Israel – if outside powers like Iran get involved, this could spiral into a wider regional conflict that could send prices at the pump soaring. Got gold?
https://english.alarabiya.net/News/middle-east/2023/10/07/Sirens-warning-of-incoming-rockets-sound-around-Gaza-near-Tel-Aviv
To all NPCs: Please change out the Ukraine flag on your social media profiles for an Israeli flag.
https://thehill.com/policy/defense/4243366-pentagon-says-it-will-support-israel-after-leader-declares-war/
Is it safe to assume at this point that inflation is fully contained and the Fed has no need for further rate hikes?
The odds the US will avoid a recession may be dwindling, top economist Mohamed El-Erian says
Jennifer Sor Oct 5, 2023, 2:47 PM ET
Mohamed El-Erian, Chief Economic Adviser of Allianz appears on a segment of “Mornings With Maria” with Maria Bartiromo on the FOX Business Network on April 29, 2016 in New York City.
Mohamed El-Erian.
Rob Kim/Getty Images
– The US’s chances of avoiding a recession just got smaller, according to Mohamed El-Erian.
– The top economist pointed to two trends that could help push the economy into a downturn.
-The New York Fed has priced in a 56% chance of a recession happening by September 2024.
There are two reasons why America’s odds of avoiding a recession may be dwindling, according to top economist Mohamed El-Erian.
The Allianz chief economic adviser has repeatedly sounded the alarm for a coming recession since 2022, the year the Federal Reserve began to aggressively raise interest rates to fight inflation. Then, prices in the economy began to cool, fueling hope that central bankers could possibly steer the economy into a soft-landing and get inflation under control without having to spark a damaging recession.
But the risk of a downturn has edged up, El-Erian said in an op-ed for the Financial Times on Thursday, as there are two factors that could spark a downturn.
1. An “intense” period of rising rates
The Fed’s interest rate hikes have steadily pushed up borrowing costs and are causing pain all over the economy.
Yields on the 10-year US Treasury bond have jumped an “eye-popping” percentage point since the end of the June, El-Erian said, which has hiked the cost of borrowing for companies and households. Mortgage rates, meanwhile, just notched a 23-year high and are edging closer to 8%.
Higher yields have also added strain to the banking sector, as more investors are reallocating their cash to money market accounts.
“For well over a year now, I have argued that the US is able to avoid the 2023 recession that many were repeatedly calling. I am now less confident about what’s in store for 2024 given how the recent surge in rates compounds the erosion in financial, human and institutional resilience,” El-Erian said.
2. Resurgent inflation
Inflation has cooled considerably from its highs last summer, but there’s a chance it could still rebound as price pressures remain in the economy.
Inflation re-accelerated in August to 3.7% year-over-year, higher than the 3.2% reported in July.
“Adding fuel to this fire are high prices for oil amid solid demand, continued production cuts by OPEC+ and heavily depleted inventories. There is a material risk of this leading to higher inflation for a broader range of goods and services,” El-Erian wrote.
Though oil prices cooled slightly this week, they’ve surged over the last month on fears of tight supply, with Brent and West Texas Intermediate crude both trading around a 10-month high in September.
Energy prices were the largest contributor to inflation in August, the Bureau of Labor Statistics said.
That spells bad news for the economy and for stocks, as resurgent inflation could eat into corporate profits.
“These are developments that the economy and markets do not enjoy. They damp growth and increase the threat of stagflation,” El-Erian said. “While markets are adjusting fast to higher rates, that of the real economy is at much earlier phase with now a much bumpier road ahead.”
Other market commentators have warned of growing recession odds in recent weeks. The yield curve, the bond market’s notorious recession gauge, has started to de-invert — a classic sign that a downturn could be around the corner.
…
Financial Times
Investing in funds
US stocks — time to sell?
After sharing in big American equity returns of past years, should UK savers now rethink their approach amid high valuations, a regulatory threat and Fed rate rises?
Philip Coggan yesterday
Is it time to move out of the US stock market? In the past decade it has served investors very well, including many UK retail savers who have steadily switched funds out of the dejected London market for America.
But stock valuations are high, with a lot hanging on the performance of a handful of mega tech companies that have generated all the recent gains in the S&P 500 index.
Moreover, the US is already gearing up for next year’s presidential election — a huge political battle that seems certain to inflame public debate, and spread uncertainty, division and even fear. Hardly the best conditions for calm business decision-making.
…
If trump wins next October, betting against stocks will look like the stupidest thing you could have done.
next October
Have you ever voted in October?
Boards, Policy & Regulation
Regulatory Oversight
Bond rout won’t end Fed balance sheet cuts, but endgame bubbling into view
By Michael S. Derby
October 6, 20239:27 AM CDT
Updated a day ago
An eagle tops the U.S. Federal Reserve building’s facade in Washington
An eagle tops the U.S. Federal Reserve building’s facade in Washington, July 31, 2013.
REUTERS/Jonathan Ernst/File Photo Acquire Licensing Rights
NEW YORK, Oct 6 (Reuters) – The bond market tumult that has sent real-world borrowing costs surging is unlikely to deter the Federal Reserve from pressing onward with shedding nearly $100 billion of bonds each month from its $8 trillion balance sheet, analysts say.
That’s because even as yields have surged and sparked new fears over a potential recession, the move has been relatively orderly even if it’s been outsized. Key measures of bond market volatility and liquidity are not flashing the warning signs they did just this past spring when Silicon Valley Bank failed and forced the Fed to launch a new emergency bank lending facility.
What’s more, pricier credit is in line with central bank officials’ desire to have interest rates at levels restrictive enough to slow growth and lower inflation back to their 2% target.
“I do not think the Fed would stop QT (quantitative tightening) unless there is a structural, liquidity issue in the Treasury market,” said Kathy Bostjancic, chief economist with insurance firm Nationwide.
Since June 2022, the Fed has allowed more than $1 trillion of bonds to mature from its portfolio, including roughly $840 billion of Treasuries. Alongside the 5.25 percentage points of Fed interest rate hikes delivered since March 2022, QT is meant to withdraw stimulus from the economy, although officials stress that rates are their primary tool.
The QT process “is just playing a minor role in the rise” in market rates, Bostjancic said, and those gains are “really due to the markets embracing the Fed’s higher-for-longer guidance” on rates.
The stopping-QT-soon argument rests on a view that bond yields have gone up too much and liquidity is too poor, so ending portfolio run-off could relieve upward pressure on rates.
And the market pressure is real: In the two weeks since the Fed’s last meeting, the 10-year note yield shot up by more than 50 basis points to nearly 4.9%, including a 15 basis point leg higher on Friday after nonfarm payrolls growth for September came in at close to double what was expected. A closely watched index from Goldman Sachs showed U.S. financial conditions near their tightest for the year on Wednesday.
So far, Fed officials themselves are unperturbed.
Cleveland Fed President Loretta Mester said Tuesday “over the next year, those tighter or higher rates will have an impact on the economy and we just have to take that into account when we’re setting monetary policy.”
Meanwhile, in a Bloomberg podcast out Thursday Chicago Fed President Austan Goolsbee said the market move “is not a puzzle… it’s clear that the long rates coming up is what you’d expect.”
…
“The bond market tumult that has sent real-world borrowing costs surging is unlikely to deter the Federal Reserve from pressing onward with shedding nearly $100 billion of bonds each month from its $8 trillion balance sheet, analysts say.”
Note to Fed: Buy low, sell high.
Note to rest of the world: Try not to catch yourself a falling knife buying long-term Treasurys.
Say what? This story was written by a computer using artificial intelligence and then fact-checked by a human editor. Wow! Or maybe I should say “oy.” Is this what journalism of the near future is going to look like — computers do the research and write the stories, and then a human double-checks them?
https://www.mouseprint.org/2023/10/02/is-this-the-future-of-consumer-journalism/
‘I have neighbors who bought a cottage for C$1.4 million at the peak of the market. In 60 days, they haven’t had one showing.’”
Welp, better get to sawin’ and slashin’ like you mean it, greedheads.
‘That’s not a fair assessment,’ said Mike Kearns, an agent with Royal LePage Locations North in Collingwood.
Realtors are liars. I say again: realtors are liars.
“In July, 2020, Bank of Canada Governor Tiff Macklem assured Canadian households that borrowing rates were very low and would stay that way ‘for a very long time.’
A Flounder moment for Canadian FBs (NSFW)
https://www.youtube.com/watch?v=MYQCb3qrBpo
At what point can Dementia Joe’s globalist handlers be charged with elder abuse?
https://twitter.com/GrahamAllen_1/status/1710354956547412017
Animal Lover in Chief
Collin Rugg
@CollinRugg
·
REPORT: President Biden has “mistreated” his dogs by punching and kicking them according to sources close with Judicial Watch.
Biden’s dogs are just like his son: Poorly trained.
Documents from the United States Department of Homeland Security, reveal injuries from attacks… Show more
https://x.com/CollinRugg/status/1710109811856294303?s=20
Its about time that somebody calls out Klaus Schwab and his terrorist cult the WEF, even if its Putin.
The WEF is a power group of Monopoly Corporations and Rich Elites, Banks etc, that want a One World dictorship, with a technological control grid of enslavement of humanity. “Klaus Schwab said, ” Who controls technology, controls the World.”
Just because the WEF, isn’t a Country invading the globe, the WEF have inflitrated governments , the United Nations etc, to advance a One World Order/Great Reset.
Its a innsurrection of a Global power grab thats just as powerful as a invading army would be.
The WEF has come out in the open with their ridiculous vision of literal control and enslavement of humanity, where all earthy resources and consumption is controlled by Monopoly Corporations,, Banks, etc, in partnership with Governments of globe, acting in lock step.
The fake narratives and WEF control over media, with censorship of dispute, is the weapon to defraud the masses into compliance to their fake emergencies and their fake solutions.
Watch: Morano on Rebel TV on How the World Economic Forum influences public policy around the world with no oversight
https://wattsupwiththat.com/2023/10/07/watch-morano-on-rebel-tv-on-how-the-world-economic-forum-influences-public-policy-around-the-world-with-no-oversight/
On last night’s episode of The Ezra Levant Show, Ezra was joined by Climate Depot’s Marc Morano to discuss Canada sending $20 million to the World Economic Forum.
“You know, there’s certain things out there that if you agree with them, they’re not a conspiracy theory, but if you disagree with them, they say you’re talking about a conspiracy theory,” Ezra began. He explored how the World Economic Forum under Klaus Schwab has made it a priority to influence the cabinets of governments around the world, including Canada. Deputy Prime Minister and Finance Minister Chrystia Freeland is in fact a member of the Forum’s board of trustees.
Marc noted that the Forum’s meetings provide the perfect opportunity for leaders from the political world to meet clandestinely with corporate and lobbying leaders. “There’s no lobbying rules and regulations, there’s no oversight, there’s no committees, there’s no regulations attributed because these are just private parties at meetings of the World Economic Forum,” he said. Yet, the contacts that are made and discussions that are had at these meetings influence public policy around the world.
“There’s no lobbying rules and regulations, there’s no oversight, there’s no committees, there’s no regulations attributed because these are just private parties at meetings of the World Economic Forum,” he said.
And I’ll bet there are plenty of offshore bank accounts,
It is funny how the MSM never sees an issue with elected officials becoming multimillionaires. Heck, it’s pretty much expected, and is probably why so many RINOs just along with everything: they want their share of the pie too.
Although all the videos are worth a watch, for this topic watch the 2m6s video below the following:
8\ @Lukewearechange asked the question many people want to know, the answer isn’t but is what you’d expect
Another uncomfortable truth about what it’s like as a Freshman to come into DC and how lobby tries to instantly capture you, if that doesn’t work it progresses to attacks.
Two homes. 20 minutes apart.
Pierre Poilievre
4 hours ago
Two homes.
20 minutes apart.
So why does one cost three times the price?
Because it’s in Trudeau’s Canada.
https://www.youtube.com/watch?v=1nnfcQmO1PY
6 minutes.
Journalism by AI
Actually the plan is that AI will run everything. This is the replacement planned by the Monopoly powers in control of AI.
A non human entity collects data at record speed, than comes to a non human conclusion, based on how it was programmed.
But, some of the advanced AI lie or develope a mind of their own.
IMHO, AI can never feel reality like humans do , or have feelings , or feel the flesh like humans. Its like just having a brain without heart or human emotion and fear of death.
It would be Hal taking over the ship.
So the New World Order are really into this new AI technology as a control grid that controls the world.
Like the human race has to worship AI as being superior.
At the end of the day these so called AI’s run on Linux machines. Unlike in “Colossus: The Forbin Project” you can pull the plug. to stop them.
What if the next generation of AI bots come with defense capabilities against plug pulling?
All you have to do is remotely cut the power. How are a bunch of servers going to prevent that? They’ll send out droids?
“AI can never feel reality like humans do , or have feelings , or feel the flesh like humans.”
How could you tell whether an AI bot programmed to express emotions actually had feelings?
Stay classy, AirBnB squatters.
https://www.dailymail.co.uk/news/article-12602925/airbnb-guest-elizabeth-hirschhorn-lied-car-crash-lawsuit.html
Feel-good story of the day.
https://www.cbsnews.com/amp/chicago/news/chicago-residents-protest-migrant-shelter/
Another chapter from the timeless classic: “You get what you voted for, good and hard!” Volume XXVI
You are clearly one of those MAGA right wing extremists that Mayor Brandon warned everyone about yesterday. You are ruining Chicago! He also advised that the bible says these strangers on the road are our neighbors and we must take care of them. I have to admit I was a little confused because all of the protest meetings with people yelling and such have all been big rooms full of black people, but now I see what he means. It’s you! This is all your fault!
This is all your fault!
And the Hildebeast would love to send me to a labor camp to be “deprogrammed”.
Squeal it out, Aussie FBs!
https://www.news.com.au/finance/economy/interest-rates/no-rate-cuts-horror-call-on-australian-economy/news-story/3a3c25a809916aca127bdbfb643c4a1e
Ok, so recently Klaus Schwab said words to effect that all cars will be banned by 2030 starting in LA. Further said that the freeways will go back to mother nature.
The only way you could have no.cars in CA or US. and freeways gone, is that populations are transported to 15 minute city centers prisons.
The replacement electric car is a big lie, because no car is the end game.
The wacko psychopath Klaus Schwab has already revealed what the WEF and their allies end game is, in his writings, statements, etc. He brags about infiltration of World governments etc.
They are taking over by increments but the end game is total enslavement, you own nothing, hacked under a control grid, eat bugs, forced austerity, forced shots and no doubt mass genocide.
Now, do you really think that these wackos are going to keep useless eaters alive under a Universal Income , watching videos. Thats just the communist bribery that government is going to take care of you, while 40 to 50 % of the jobs are replaced by AI and Robots.
There isn’t anything that isn’t fake about their narratives . Its just the pathway to destruction of the current systems.
What a joke that they are saving the world from Climate Change, or bio weapon viruses, they release.
While these fraudsters narratives are breaking down , and people are noticing massive death and injury by their fake vaccines, they continue with their pre-planned warfare to rule the world.
And the Democrats and evil Hilary calling for taking trump supporters to concentration camps, or reeducation camps. Its like Hitler on steroids.
And Schwabs father was a Hitler buddy, and they say Schwabs mother is tied to being a Rothschild .
For some reason they are intent on accomplishing their full dictorship by 2030, so they are moving faster and faster with their agenda .
Don’t comply with their ridicules dictates .
🔥🔥🔥 Blade Runners Simple but Effective ULEZ Attack – Spray Paint on a Stick 🎨
https://www.bitchute.com/video/ymWZVSFbctxe/
13 seconds. They couldn’t even pull off this anti-car thing for a week.
It wasn’t actually a ban, it was a shakedown: “Your non ULEZ car is destroying the planet! But if you give us 20 pounds we’ll let you drive it in London today.”
I also doubt Klaus really wants to ban cars. He isn’t going to get around on a horse draw coach, will he?
What he and his ilk will try to do is make car ownership too costly for the middle class. The same applies to eating meat, travelling, etc. While they want Orwell’s proverbial “boot ona human face, forever” they will suffer no impact on their lifestyle. Not e how Bill Gates and John Kerry justify their private jets: it’s because they are saving the world and the work the do for that is sufficient justification.
Meanwhile, Gates is known for flying the family horses from ranch to ranch.
…”they could pull the plug.”
If the people who control the plugs don’t want to pull the plugs, than they wont.
Perfect example is that the Powers that Be, don’t want to pull a unsafe failed technology fake vaccine from the market.
These people have perverse incentives to being a threat to this world.
Then it’s the Davos crowd who are in charge, not the AI’s. Granted, the globalists could use AI’s to bamboozle the naive masses, using them to justify the Narrative.
My point was that the notion that the AI’s could become sentient and take over the world is nonsense. We could cut the power, bomb the datacenters, cut the data connectivity, etc.
Like in the Movie Space Odessey, the human pulled the HAL Computer plug.
What about other Countries that develope AI, are they going to pull the plug if necessary.
This discussion is fun to have and we can imagine all kinds of different scenarios of doom etc but I would just point to the Amish. They will be fine, why can’t we?
All of this is a choice. Their control is an illusion.
Of course many will ignore the AI’s. But many, like those memes were the slack jawed, neckbearded NPC points at whatever the Narrative is saying, will accept what the AI’s vomit as gospel.
There will always be failsafes and kill switches.
and cups of coffee to spill.
Like in the Movie Space Odessey, the human pulled the HAL Computer plug.
Actually, David Bowman had to literally disassemble HAL to shut him down. Which is nonsense. There would be some sort of non AI backup to control the ship should HAL malfunction. Of course there would be a failsafe/kill switch to stop HAL should it malfunction
Those ai articles are junk. You can totally tell it’s computer gibberish. I’ve learned to spot them and avoid.
Ditto for the Narrative-compliant dreck pushed out by the talentless scribblers who impersonate journalists at the globalist scum media.
The fatal flaw in the WEF system is that it benefits only a corrupt and venal .1% in the financier oligarchy. As even the dullest of the sheeple make the link between globalism and the destruction of their standard of living and trashing of all they hold dear, we are going to see rising resistance from those who do not intend to go quietly into that Long Goodnight the sociopathic “elites” have in store for them.
The fatal flaw in the WEF system is that it benefits only a corrupt and venal .1% in the financier oligarchy.
FWIW. it’s what they have been doing since before I was born. Most seem to just accept what is happening to them. They’ve accepted the progression from “dad can provide for the family and stay out of debt” -> “mom has to work too” -> ” we can’t afford more than one kid” -> “we can’t afford any kids” -> “I am dependent on the state for my basic needs”
Those ai articles are junk.
Correct. They are trying to spin a narrative that AI’s are infallible and that someday soon we will have no choice other than to obey them if we wish to survive. Many will fall for it, even demand it. Never forget how many wished to send us to labor camps if we refused the jab.
I haven’t even met a reasonably usable phone answering system.
Al-Qassam Brigades target an Israeli army convoy with a ´Kornet´ ATGM missile
https://www.bitchute.com/video/i3n1wzixpkt7/
40 seconds.
Gaza Launches Special Military Operation Against Israel. Military Summary And Analysis For 2023.10.7
https://www.youtube.com/watch?v=HrTmZfwdNnc
15:33. There’s a controlled demolition at 13:30.
‘These Fed losses are the result of a radical and exceptionally risky Fed choice to build a balance sheet resembling a giant 1980s savings and loan’
It’s not different this time?
‘These five areas have experienced the greatest price change in the last four years, which suggests that there have either been significant economic changes to support higher prices or the run-up is potentially unsustainable’
This is why you make the big bucks Danielle.
‘Many sellers are also recent transplants experiencing buyer’s remorse—an advantage for cottage shoppers…People tried cottage living. Some haven’t liked it. Now they want out. There are absolutely motivated sellers’
That’s the spirit John!
‘When her mortgage came due last fall, Ms. Daya signed a one-year mortgage at 7.92 per cent. This added an additional $6,000 to her monthly payments, bringing them to $31,000. A key tenant did not renew earlier this year and Ms. Daya has not been able to find a new one. Ahead of the looming mortgage renewal next month, Ms. Daya has put her office on the market. She listed the property for sale earlier this year and in mid-September, dropped the price by $1.5-million to $6-million. ‘It’s not a great time to sell. But I think that’s my best option, rather than struggling every month,’ Ms. Daya said. The uncertainty about the situation ‘is definitely anxiety inducing’
Jasmine, I couldn’t help but noticing that yer decision to sell with an a$$pounding had nothing to do with supply and demand
‘When her mortgage came due last fall, Ms. Daya signed a one-year mortgage at 7.92 per cent. This added an additional $6,000 to her monthly payments, bringing them to $31,000.’
Is this ‘dating the rate’?
‘I personally have some anxiety about whether I’ve made a choice to have a house over being able to retire. Inflation made it worse’
Owen, shopping carts aren’t really strenuous and it’s good exercise.
The Top Ten Dumbest Things Empire Propagandists Ask Us To Believe
https://caityjohnstone.medium.com/the-top-ten-dumbest-things-empire-propagandists-ask-us-to-believe-f92b42147b2c
(I particularly like Number 5 …)
“5. That it is only by pure coincidence that your nation’s population remains in a perpetual 50–50 deadlock which prevents anyone’s votes from changing the status quo, and the status quo just happens to be perpetually frozen along lines that hugely advantage the rich and powerful.”
I particularly like this one:
9. That foreign propaganda and influence operations are significantly manipulating the way westerners think and vote, but the plutocrats who fully control all the most influential platforms in the western world are not.
See Smith-Mundt Modernization Act of 2012.
Re: as global supply chains struggled to keep up with sharply rising demand for everything from lumber to lettuce, inflation took off
Price inflation has nothing to do with supply/demand which is self-correcting in a free market and everything with monetary inflation which, as its name implies, is caused by creation of fiat money which is a one-way street. As long as Economists fail to grasp this simple fact, we will be forever sinking into quicksand . . .
Do you worry your income may be insufficient to finance a home purchase, given today’s home prices plus mortgage rates about to breach 8%?
PERSONAL FINANCE
More mortgage applications are being rejected for ‘insufficient income.’ Here’s why
PUBLISHED WED, OCT 4 2023 9:00 AM EDT
UPDATED WED, OCT 4 2023 12:22 PM EDT
Jared Mitovich
KEY POINTS
– Mortgage payments have become significantly less affordable for homebuyers, according to the Consumer Financial Protection Bureau.
– Nearly a quarter of refinance applications were rejected in 2022 — up sharply from 14.2% in 2021.
– Ted Jenkin, CEO of oXYGen Financial, recommended that consumers focus on their debt-to-income ratio
…
https://www.cnbc.com/2023/10/04/why-more-mortgage-applications-are-being-rejected-based-on-income.html
Mortgages
Mortgage Interest Rates Today, October 8, 2023 | Rates Up Across the Board
Written by Molly Grace; edited by Sarah Silbert
Oct 8, 2023, 3:00 AM PDT
Our experts answer readers’ home-buying questions and write unbiased product reviews (here’s how we assess mortgages). In some cases, we receive a commission from our partners; however, our opinions are our own.
Mortgage rates are up significantly compared to where they were a month ago. Average 30-year mortgage rates have increased nearly 20 basis points since this time in September.
Depending on the path of inflation, mortgage rates could start inching down before the end of the year. Borrowers should keep an eye on Thursday’s Consumer Price Index data release to see how inflation fared in September.
As long as inflation continues to slow, mortgage rates should start to come down soon. But exactly when we’ll start seeing lower rates depends in part on the Federal Reserve. If the Fed feels it needs to hike the federal funds rate again to bring inflation down to its target rate, or if it waits longer than expected to start cutting rates, mortgage rates could stay elevated for longer.
…
Mortgage Rates for Buying a Home
30-Year Fixed Mortgage Rates Increase (+0.17%)
The current average 30-year fixed mortgage rate is 7.49%, up 17 basis points since this time last week. This rate is also much higher compared to a month ago, when it was 6.85%.
At 7.49%, you’ll pay $699 monthly toward principal and interest for every $100,000 you borrow.
The 30-year fixed-rate mortgage is the most common type of home loan. With this type of mortgage, you’ll pay back what you borrowed over 30 years, and your interest rate won’t change for the life of the loan.
…
https://www.businessinsider.com/personal-finance/best-mortgage-refinance-rates-today-sunday-8-2023-10
Bloomberg
Opinion
Javier Blas, Columnist
For Oil, It’s Not 1973 Again – But It Could Still Turn Ugly
Crude prices are likely to rise after the surprise Hamas attack on Israel, but there’s still plenty of capacity to tap.
October 7, 2023 at 6:47 AM PDT
By Javier Blas
Javier Blas is a Bloomberg Opinion columnist covering energy and commodities. He is coauthor of “The World for Sale: Money, Power and the Traders Who Barter the Earth’s Resources.”
Youths attend a short documentary feature in Cairo last week with archival clips from the 1973 Arab-Israeli war Photographer: KHALED DESOUKI/AFP
History doesn’t repeat itself, but it often rhymes. On the eve of the 50th anniversary of the world’s first oil crisis, the parallels between October 2023 and October 1973 are easy to draw: A surprise attack on Israel and oil prices rising. But the resemblance ends there.
The global economy isn’t about to suffer another Arab oil embargo that would triple the price of a barrel of crude. Yet, it would be a mistake to downplay the chances that the world faces higher-for-longer oil prices.
…
https://www.bloomberg.com/opinion/articles/2023-10-07/hamas-attack-on-israel-for-oil-it-s-not-1973-but-it-could-still-turn-ugly
“I pull in resolution and begin
To doubt the equivocation of the fiend
That lies like truth, ‘Fear not till Birnam wood
Do come to Dunsinane’, and now a wood
Comes toward Dunsinane.”
– William Shakespeare’s Macbeth
“If the Fed feels it needs to hike the federal funds rate again to bring inflation down to its target rate, or if it waits longer than expected to start cutting rates, mortgage rates could stay elevated for longer.”
Suppose the Fed decided not to worry about any more rate hikes, and imstrad let infllation run rampant. In the absence of Quantitative Easing, wouldn’t long-term Treasury yields (amd mortgage rates) go higher to compensate long-term bond investors for losses to inflation?
Methinks financial journalists misunderstand the relationship of inflation to long-term bond yields.
compensate long-term bond investors for losses to inflation?
They are getting crushed. Perhaps the market doesn’t love them?
Business Insider
A California Airbnb host didn’t register his home properly, and now can’t get rid of a guest who overstayed 541 days and counting
Joshua Zitser
Fri, October 6, 2023 at 9:42 AM PDT·4 min read
…
https://finance.yahoo.com/news/california-airbnb-host-didnt-register-192608036.html
Investment titan BlackRock has taken massive hits because of its use of ESG
By Charles Gasparino
Published Oct. 7, 2023, 10:09 p.m. ET
0:00 / 1:30
It’s been a difficult couple of years for BlackRock, the world’s biggest money manager. The firm is still enormously profitable, though it has recently taken some big hits because of its image as a promoter of progressive utopianism through its use of Environmental Social Governance — or ESG — investment guidelines.
Red state government officials are defenestrating the company from managing their pension money. The conservative commentariat has blamed the firm’s ESG screening of stocks for higher gas prices and inflation. The rap against BlackRock is that it promotes investing in “sustainable” energy sources but incentivizes oil companies to stop drilling. Larry Fink, its voluble founder and CEO, has been branded as some sort of C-suite leftist.
…
https://nypost.com/2023/10/07/investment-titan-blackrock-has-taken-massive-hits-because-of-its-use-of-esg/
More evidence that Charles Gasparino is a gasbag. Who uses words like defenestrating, commentariat and voluble let alone in the same paragraph?! This site’s spellcheck doesn’t recognize the first two of those words!