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Finally, The Penny Is Dropping

A report from US News and World Report.”It was a case of good news, bad news as new home sales increased by 12.3% in September while prices dropped sharply from a year ago, the Census Bureau said on Wednesday. Builders have been offering incentives such as mortgage buy-downs and additional upgrades to lure buyers as mortgage rates flirt with a level of 8% for a 30-year fixed rate loan. The median sales price, meanwhile, was $418,800 – down from $430,100 in August and a 12% drop from $477,700 a year ago.”

From WFLX. “It’s what appears to be a housing cooldown across south Florida. From the Treasure Coast to Miami, home sales slowed down and median home prices dipped for now several months in a row. And it’s not just Martin County’s sales slowing down. ‘Parts of Indian River County, St Lucie county, Martin county, Palm Beach County, even parts of Dade,’ Stuart real estate agent Alex Haigh said. He also said inventory is up and houses are staying on the market longer than about a year ago. ‘We can feel it as real estate agents, the phone doesn’t ring as much,’ Haigh said.”

WAFB in Louisiana. “According to the Greater Baton Rouge Association of Realtors (GBRAR), new listings, pending sales, and closed sales have fallen since September 2022. On the other hand, the number of days on the market, inventory of homes for sale, and months supply of inventory increased. President Kendra Novak of GBRAR said in the last few months, the housing market seems to be picking up as more properties make their way to the market. She’s hopeful that there will be more inventory but said buyers are still reluctant to quickly pull the trigger. ‘I’m hoping that it somewhat stabilizes first,’ said Novak. ‘And as buyers begin to return to the market, I think we are shifting where right now they somewhat have the power, basically to say no, I’m not paying that amount of money.'”

Market Place. “At the end of last year Clark Ivory was getting really concerned about his business. He’s CEO of Ivory Homes, a building company in Utah. When interest rates spiked, ‘We just saw traffic go to almost nothing, and sales really dried up,’ he said. Now though they’re in a much better position. ‘We sorta found our footing, we figured out what we needed to do to buy down interest rates to make it still affordable for people,’ said Ivory. Today they’re able to offer mortgage rates around six or six-and-a-half percent, much better than eight.”

A press release. “More homebuyers looked to leave Austin, TX than move in during the third quarter, according to Redfin. That’s the first time on record there hasn’t been a net inflow into the Texas capital. Redfin’s records go back through 2017. By mid-2022, when Austin home prices peaked, prices were up more than 75% from before the pandemic. Austin’s median home price is down about 5% year over year, the biggest decline in the U.S., and it’s down nearly 20% from its pandemic peak. ‘I’m telling buyers that this is the first time in years they can get a deal on a house, even with high mortgage rates,’ said Austin Redfin Premier agent Carmen Gioia. ‘It’s probably a better time to buy down than waiting for mortgage rates to drop, because once that happens, competition will escalate and prices will shoot up. Right now, buyers are able to take their sweet time, negotiate with sellers, and buy a home without getting into a wild bidding war.'”

The Seattle Times. “A Bellevue investment firm is facing bankruptcy and legal trouble after allegations of raising millions of dollars from investors, many of whom are Chinese nationals and immigrants, then failing to finish promised real estate projects and repay investors. Operating for around a decade, iCap raised money telling investors it planned to develop apartment complexes, mixed-use buildings and senior housing throughout Washington, according to court filings. ICap and its subsidiaries operated more than two dozen affiliated companies and appeared to own at least 10 properties in the state, including sites in Seattle, Tacoma, Bremerton, Lynnwood and Vancouver. Some sites remain undeveloped despite promises to investors, lawsuits allege.”

“Trouble began for investors this spring when the company stopped paying monthly interest payments, citing challenges hitting the slowing real estate market. It’s not clear how many investors bought promissory notes from iCap companies or how much the company owes, but bankruptcy filings list more than 2,700 people and entities owed money and total financial liabilities between $100 million and $500 million. The company owes nearly $196,000 in payroll taxes to the IRS and $11,000 in property taxes to Snohomish County for a property in Lynnwood, according to bankruptcy filings. Dozens of Chinese investors are among those owed money, sparking a lawsuit this summer alleging iCap ‘specifically targeted Chinese immigrants who relocated to Washington and Chinese nationals with their marketing efforts.'”

“‘According to that case, a group of 28 investors invested more than $17.5 million and have not been fully repaid. ‘My clients — all of whom are from China, and many of whom do not speak English — invested their savings with iCap so they could improve their lives or the lives of their families here in the U.S.,’ attorney John Bender said in a statement to The Seattle Times. The investors ‘have been completely devastated by the revelations over the past few months’ and ‘are committed to holding accountable those who are found to have misled unsuspecting investors or who have engaged in other misconduct,’ Bender said.”

Mission Local in California. “Patrick Quinlan sat hunched outside the Memorial Court Gates across City Hall, hoping the next few phone calls he’d make could keep his dream of building housing alive. Back in 1978, Quinlan purchased land in Bernal Heights, hoping to develop it and fund his retirement. After some navigating unworkable plans and neighbors’ opposition since plans submitted in the ‘90s, Quinlan finally secured the entitlements in 2019: Five sets of duplexes at 1513 York St., totaling 10 units. Instead, on Tuesday the lender Gerrard McConville foreclosed on the property after Quinlan stopped making mortgage payments, thus closing the final chapter on the 81-year-old’s sisyphean development saga. ‘After 44 years, I don’t get anything,’ Quinlan said. Quinlan’s hopes died not with a bang, but an auction.”

Market Watch. “Bids are coming due on the biggest commercial-real estate transaction of its kind, at a crucial moment for property markets. When the Federal Deposit Insurance Corp. in March seized $33.2 billion of assets from New York’s Signature Bank after it failed, the banking regulator also inherited a tangled web of about $15 billion of loans mostly on rent-stabilized or rent-controlled buildings in New York City. Some in the industry have taken to calling those loans ‘toxic.’ It’s footprint in the city was estimated to span almost 3,000 buildings, representing nearly 80,000 homes, according to New York City Comptroller Brad Lander. An investigation by The City, a nonprofit New York City newsroom, found tenants at some well-managed buildings in the Signature Bank portfolio, but also ‘hundreds of vulnerable properties’ where tenants are suffering and values have ‘plummeted.’ Real-estate brokerage firm Newmark is overseeing the Signature Bank portfolio sales, but the FDIC also can opt to delay or pull assets from the market if bid levels come in too low.”

The Globe and Mail in Canada. “Unpaid contractors and unsatisfied buyers are demanding answers from a Toronto-area developer that is years behind on delivering multiple condominium projects. Vandyk Properties and owner John C. Vandyk have a decades-long history of building primarily low- and mid-rise residential multifamily projects. According to court records, in recent years it has secured hundreds of millions of dollars in loans to rapidly expand. But work has stalled on a half-dozen Vandyk projects. There are hundreds of preconstruction buyers and real estate agents waiting on Vandyk as well.”

“Akshay Sehgal is a condo sales specialist with Re/Max Plus City Team who said that agents who sold preconstruction units at Vandyk sites are still waiting for partial commissions that have been owed to them for years. ‘I’m not asking anybody to cry for real estate agents … I know about 40-50 agents that did that and did not get paid,’ Mr. Sehgal said. Hundreds of buyers are also trapped. ‘I’m just hoping they are not going to go bankrupt,’ said Dean Khan, who worries about getting his deposit back and or some day getting his condo.”

“‘I go there on a daily basis to look, to see what’s moved,’ said Casendra Vijaya, who purchased in 2017. ‘I’ve been renting now and I lived with my parents for longer. … I should have bought a house by now, but my money is stuck.’ She also recently received unsolicited advice from a Vandyk receptionist when she contacted the company for an explanation as to why work has stopped at the site: ‘She told me just stop going and looking.'”

The Evening Standard in the UK. “In the early summer the sun was shining, the air was scented with lilac and Kam Babaee was full of optimism when he put his former family home on to the market for £7.95 million. The magnificent seven-bedroom Gothic vicarage in Chiswick had just been fully renovated and Babaee thought that another family would snap it up. But over the weeks that followed, his optimism faded along with the lilac blossom. Buyers came to look. One even made an offer but could not raise the cash and had to drop out. Last month, Babaee bowed to the inevitable and knocked a cool £1 million off his asking price. The house is now listed with Dexters for £6.95 million.”

“Across prime London, homeowners are reaching similar conclusions. Trophy mansions, beloved family homes, glamorous townhouses on famous streets and fabulous lateral flats on garden squares are all having seven-figure sums shaved off their asking prices to tempt buyers over the threshold. Some owners simply want to unload surplus homes, even at a loss. Buying agent Camilla Dell is currently acting for a client who is in the process of buying a house in Knightsbridge. ‘Its owner is a billionaire, he bought it at the peak of the market, and he put it on sale for significantly less than he paid for it,’ she says. ‘He is selling it for even less, because he just doesn’t need it any more. It is not just super-distressed sellers who are cutting prices.’ ‘Finally, the penny is dropping,’ says Dell. ‘Anyone who wants to sell a property has got to be realistic, because buyers are super sensitive about price.'”

The Irish Independent. “31 out of 43 of the homes on the Tobar Mhuire development site in Creagh Demesne in Gorey remain unfinished since the site closed in December 22, 2022. ‘My gripe here is that I don’t believe that at this moment in time with the building site closed for ten months that Wexford County Council are pulling out all the stops to sort out whatever issue that is holding up the site and why the site is closed. The limbo at the moment is just a waste of everybody’s time and it’s actually giving the two fingers to everybody on the housing list,’ said Councillor Joe O’Sullivan.”

ABC News in Australia. “Hundreds of failed construction companies are suspected of insolvent trading, but not one has been prosecuted by the watchdog responsible for holding them to account. One of those home owners is Christine Tugwell, whose builder went under in May, with the company’s liquidator finding it had likely been trading insolvent for ‘at least six months.’ Ms Tugwell said the building franchise, Stroud Homes Northern Rivers, asked her to make extra payments in the months before it entered liquidation, and she had to borrow money from a relative to cover the unexpected cost.”

“Her builder, Matthew Lowson, is accused of accepting hundreds of thousands of dollars in deposits from other customers during this time, without insuring them. Ms Tugwell and her partner Oliver, who are in their 30s, said they were struggling to find more than $1,200 a week to cover the mortgage on their unfinished house and land and their rent, while awaiting an insurance payout to select another builder. ‘We’re roughing it out in a one-bedroom tiny home and are putting plans to have a second baby on hold until we can get this sorted,’ Ms Tugwell said. ‘I’m working extra night shifts and weekends when he can look after our daughter and he’s working during the week, we’re tag teaming it.'”

South China Morning Post. “Hong Kong’s luxury home market, which has been dealt a triple whammy of lower economic activity in mainland China, elevated global interest rates and higher mortgage costs, is poised for disappointment at this week’s policy speech by the city’s chief executive. Hong Kong Chief Executive John Lee Ka-chiu will deliver his second policy speech in the Legislative Council at 11am on Wednesday and the market anticipates some rollback of the property cooling measures announced earlier. Despite sellers reducing their asking prices, the luxury housing market has yet to witness an influx of buyers. The transaction volume for residential properties valued at or above HK$20 million (US$2.56 million) has plummeted by 52 per cent in the third quarter.”

“The luxury market has been flooded with new flats in recent months, with unsold inventory levels in completed projects at the highest level since 2007. This could put pressure on property values at a time when the investment environment continues to deteriorate. ‘We anticipate a decline in luxury home prices of up to 5 per cent in 2023 and another 5 per cent in 2024 due to elevated interest rates, geopolitical uncertainties, and sizeable unsold stocks,’ according to JLL.”

The Wall Street Journal. “With China’s property bust threatening to sink the country’s economic recovery, Xi Jinping is looking for someone to blame. After putting the billionaire founder of Evergrande, a heavily indebted property firm, under investigation for possible crimes, Beijing is expanding its probes to include bankers and financial institutions that facilitated developers’ risky behavior, people familiar with the matter say. Among those under scrutiny: a former head of Bank of China, one of the country’s biggest lenders, the people said. While meeting with senior officials last month, Xi made it clear he wants no stone left unturned when it comes to disciplining a real-estate industry that at its peak made up as much as a quarter of China’s economy.”

“The end of China’s property boom has saddled the country with debt, spooked investors and left many consumers unwilling to spend. Another focus of the Hui probe, people close to Beijing said, is whether Hui and his management team engaged in illegal fundraising activities, such as giving kickbacks to banking executives in exchange for loans. Following news of the investigation into Hui, dubbed ‘Brother Belt’ by many in China for his penchant for Hermès belts, videos of his lavish lifestyle—including a dancing troupe he kept on the company’s payroll to entertain bankers and other VIPs, despite its financial stress—have flooded China’s tightly monitored social media, a sign of Beijing’s intention to make an example of him.”

“Meanwhile, developers’ financial distress is dragging down home sales and housing starts as they run out of money to finish projects and build new ones. Weakening home prices are squeezing developers even more and slowing China’s rebound from dismal growth this summer. In a sign of potential wider risks, fears of Evergrande’s financial troubles sparked a run this month on a small bank in northern China’s Hebei province. Depositors lined up at the Bank of Cangzhou after social-media posts said the bank’s lending to Evergrande totaled 3.4 billion yuan, equivalent to $465 million, which would make it one of the developer’s top 20 bank creditors.”

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This Post Has 77 Comments

  1. idiom. British, informal. used to say that someone finally understands something after not understanding it for a time. I had to explain it to him three times, but finally the penny dropped.

    1. Washington Post — Mike Johnson played a central role in trying to overturn the 2020 vote (10/25/2023):

      “Johnson played one of the most significant roles of any member of Congress in the effort to overturn the election. But unlike some of his more bombastic colleagues, much of it was behind the scenes, through a legal filing, closed-door Republican Party strategy sessions and private conversations with Trump.

      Now that Johnson has emerged as the next speaker in a vote that was celebrated Wednesday by Trump’s MAGA movement, his role as a ringleader of efforts to overturn Biden’s victory is generating new scrutiny. It is also prompting fresh attention to how Johnson could use his new job to influence the outcome of the next presidential election, should he still be speaker in January 2025.”

      https://archive.ph/28anp

      Joe Biden is not, and will never be, the legitimate president of the United States.

      You are living under an unelected, illegitimate regime that has no actual authority to govern.

      Merrick Garland is an illegitimate Attorney General with no authority to prosecute or enforce any laws.

      Antony Blinken is an illegitimate Secretary of State with no authority to implement U.S. foreign policy.

      Janet Yellen is an illegitimate Secretary of the Treasury with no authority of U.S. fiscal or monetary policy.

      81 million ballots, not 81 million votes, because the 2020 election was stolen.

  3. ‘From the Treasure Coast to Miami, home sales slowed down and median home prices dipped for now several months in a row. And it’s not just Martin County’s sales slowing down. ‘Parts of Indian River County, St Lucie county, Martin county, Palm Beach County, even parts of Dade’…He also said inventory is up and houses are staying on the market longer than about a year ago. ‘We can feel it as real estate agents, the phone doesn’t ring as much’

    That’s several counties where shack prices have been sinking like a turd in a well for months.

  4. ‘Quinlan finally secured the entitlements in 2019: Five sets of duplexes at 1513 York St., totaling 10 units. Instead, on Tuesday the lender Gerrard McConville foreclosed on the property after Quinlan stopped making mortgage payments, thus closing the final chapter on the 81-year-old’s sisyphean development saga. ‘After 44 years, I don’t get anything’

    I hear ya Pat, and not one person even showed up to bid.

  5. ‘I go there on a daily basis to look, to see what’s moved,’ said Casendra Vijaya, who purchased in 2017. ‘I’ve been renting now and I lived with my parents for longer. … I should have bought a house by now, but my money is stuck.’ She also recently received unsolicited advice from a Vandyk receptionist when she contacted the company for an explanation as to why work has stopped at the site: ‘She told me just stop going and looking’

    On the bright side, that should save some time Casendra.

  6. ‘Following news of the investigation into Hui, dubbed ‘Brother Belt’ by many in China for his penchant for Hermès belts, videos of his lavish lifestyle—including a dancing troupe he kept on the company’s payroll to entertain bankers and other VIPs, despite its financial stress—have flooded China’s tightly monitored social media, a sign of Beijing’s intention to make an example of him’

    Wa happened to my last minutes payments bloomberg?

  8. ‘Builders have been offering incentives such as mortgage buy-downs and additional upgrades to lure buyers as mortgage rates flirt with a level of 8% for a 30-year fixed rate loan. The median sales price, meanwhile, was $418,800 – down from $430,100 in August and a 12% drop from $477,700 a year ago’

    And the incentives aren’t part of that 12% crater. So recent buyers are really fooked.

      1. These people getting rate buy-downs from builders are rate daters too. The buy downs are one to three years only.

  9. How’s that “Build Back Better” working out for all of you?

    CNBC — The U.S. consumer is ‘walking towards a cliff,’ strategist warns (10/26/2023):

    “I think the U.S. consumer is walking towards a cliff, basically,” Chris Watling, chief executive of financial advisory firm Longview Economics, told CNBC’s “Squawk Box Europe” on Tuesday.

    He said that a slew of recent economic indicators had showed consumers are quickly running out of excess cash, while household savings are coming under pressure.

    “Of course, retail sales have been quite strong for the last few months and everyone gets quite excited about that, but, actually, if you look at what’s going on, the household savings ratio has been run down, and, in fact, real income growth has been negative for three months,” Watling said.

    “So, it’s not quite all good news. I mean, quite the reverse, I think there are some real challenges coming for the U.S. consumer.”

    https://www.cnbc.com/2023/10/26/the-us-consumer-is-walking-towards-a-cliff-strategist-warns.html

    How much new money has been printed in the last three and a half years?

    Because of an alleged “virus” with an infection fatality rate that is statistically near zero except for the fats and olds.

    “Ever get the feeling that you’ve been cheated?” — Johnny Rotten, the Sex Pistols

  10. ‘Its owner is a billionaire, he bought it at the peak of the market, and he put it on sale for significantly less than he paid for it,’ she says. ‘He is selling it for even less, because he just doesn’t need it any more’

    So you just stood there and let him give it away Camilla?

  11. ‘Stroud Homes Northern Rivers, asked her to make extra payments in the months before it entered liquidation, and she had to borrow money from a relative to cover the unexpected cost’

    It’s an investment Christine, it’ll pay back double, you’ll see.

    ‘Her builder, Matthew Lowson, is accused of accepting hundreds of thousands of dollars in deposits from other customers during this time, without insuring them. Ms Tugwell and her partner Oliver, who are in their 30s, said they were struggling to find more than $1,200 a week to cover the mortgage on their unfinished house and land and their rent, while awaiting an insurance payout to select another builder. ‘We’re roughing it out in a one-bedroom tiny home and are putting plans to have a second baby on hold until we can get this sorted,’ Ms Tugwell said. ‘I’m working extra night shifts and weekends when he can look after our daughter and he’s working during the week, we’re tag teaming it’

    Christine and Ollie are winnahs!

  12. Federal income taxes.

    The White House is losing the messaging war on Ukraine. Now it’s changing the message (10/25/2023):

    “The White House has been quietly urging lawmakers in both parties to sell the war efforts abroad as a potential economic boom at home.

    Aides have been distributing talking points to Democrats and Republicans who have been supportive of continued efforts to fund Ukraine’s resistance to make the case that doing so is good for American jobs, according to five White House aides and lawmakers familiar with the effort and granted anonymity to speak freely.

    “As we replenish our stocks of weapons, we are partnering with the U.S. defense industry to increase our capacity and meet the needs of the U.S. and our allies both now and in the future,” according to a copy of the talking points obtained by POLITICO.

    “This supplemental request invests over $50 billion in the American defense industrial base — ensuring our military continues to be the most ready, capable, and best equipped fighting force the world has ever seen — and expanding production lines, strengthening the American economy and creating new American jobs,” the document states.

    https://www.politico.com/news/2023/10/25/biden-ukraine-aid-messaging-00123466

    Selling World War III as a jobs program?

    People who profit from war and death deserve a very special place in Hell. And which you may have #Noticed, many of them are not Christians.

    See also:

    https://www.antiwar.com/

    1. Related article.

      Russia Today — Zelensky aide slams Musk over calls to end conflict (10/25/2023):

      “Mikhail Podoliak, a senior aide to Ukrainian President Vladimir Zelensky, described Elon Musk’s calls for an urgent ceasefire in the Ukraine conflict to avoid a larger conflict as a “catastrophic mistake” with far-reaching consequences, in a Telegram post on Tuesday.

      The advisor’s comments came after Musk warned that the US was “sleepwalking” into World War III by antagonizing countries like Russia, Iran, and China, during a conversation on X (formerly Twitter) Spaces on Tuesday.

      Musk said he believed that “civilization itself may be at stake” and stressed that the US must work to prevent a global conflict. To that end, he called on the US to “resume normal relations with Russia” and “figure out” a way to establish peace in Ukraine, labeling the war a hopeless situation.

      The billionaire noted that it made no sense that soldiers from Russia and Ukraine should die every day and stressed that a ceasefire was the only way out of the conflict for the Ukrainian people, since Russia would never give up its lands – apparently referring to Crimea, Kherson, Zaporozhye, and the Donbass republics. Ukraine would never be able to take over these territories with its smaller army, he added.

      Musk suggested that the current line of control could be a suitable permanent border between Russia and Ukraine since, according to him, there is no significant anti-Russian insurgency in the “Russian-speaking areas of Ukraine” and, therefore, there is little point in forcing areas that want to be part of Russia to be part of Ukraine.”

      https://www.rt.com/russia/585767-kiev-musk-peaceful-solution/

      A hopeless situation? Sounds about right.

      U.S. taxpayers, you will NEVER be seen as anything more than cattle tax slaves to these globalists.

      Onward Christian Soldiers, as always, because the globalists’ children don’t fight and die in these endless wars, only yours do.

  13. ‘It’s probably a better time to buy down than waiting for mortgage rates to drop, because once that happens, competition will escalate and prices will shoot up‘

    You can’t let that FOMO die. Keep stoking the embers of fear. 🙄

    1. DOW 30 -0.15%
      S&P 500 -0.63%
      NASDAQ 100 -1.17%

      The S&P 500 just logged its longest losing streak of the year as spiking bond yields sow panic on Wall Street
      George Glover
      Oct 24, 2023, 2:14 AM PDT
      Wall Street is bracing for what comes next after a brutal August and September for stocks
      The benchmark S&P 500 index just logged its longest losing streak of 2023, per data from Refinitiv.
      Mario Tama / Getty

      – US stocks’ early-year rally has ground to a halt in recent months.

      – The benchmark S&P 500 index just notched its longest losing streak of 2023, per Refinitiv.

      – Its losses come with Wall Street fretting about slumping bond prices, with 10-year Treasury yields hitting a 16-year high Monday.
      …
      https://markets.businessinsider.com/news/stocks/stock-market-outlook-spiking-treasury-bond-yields-wall-street-investing-2023-10

    2. Investor’s Business Daily
      Investors Scurry To Buy 14 Soaring Stocks As Market Sells Off
      MATT KRANTZ 08:00 AM ET 10/25/2023

      Don’t assume that all S&P 500 stocks are struggling. A small group are actually thriving, thank you.

      Fourteen S&P 500 stocks — including drug developer Eli Lilly (LLY), insurer Progressive (PGR) and Constellation Energy (CEG) — have gained 10% or more since the market peaked this year on July 31, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. That makes them a pleasant counterbalance to the S&P 500, which has lost 7.4% since then.

      Note how the S&P 500 leaders have changed. Not a single “Magnificent Seven” big-cap tech stock is a top performer since the market topped. It’s a whole new group taking charge now.
      …
      https://www.investors.com/etfs-and-funds/sectors/sp500-investors-scurry-to-buy-soaring-stocks-as-market-sells-off/

    3. DOW 30 -0.09%
      S&P 500 -0.35%
      NASDAQ 100 -0.84%

      The record-breaking crash in bonds is a threat to stock prices and American jobs. Here’s everything you need to know about the Treasury-market turmoil.
      George Glover
      Oct 25, 2023, 7:51 AM PDT
      FILE – Traders work on the New York Stock Exchange floor in New York City, on Tuesday, Sept. 5, 2023. Treasury yields surged in September and sapped the energy from a strong stock market as investors came to terms with the likelihood that interest rates will remain high well into 2024. The yield on the 10-year Treasury jumped to the highest level in nearly two decades.
      (AP Photo/Ted Shaffrey, File)
      10-year Treasury yields topped 5% for the first time in 16 years Monday – and that’s sparked panic on Wall Street.
      Ted Shaffrey/AP Photo

      – A deepening crash in the bond market has sparked panic on Wall Street in recent weeks.

      – Treasury prices have plummeted, sending benchmark 10-year yields above 5% for the first time in 16 years.

      – Here’s what the market meltdown means for stocks, the economy, and ordinary people.
      …
      https://markets.businessinsider.com/news/bonds/bond-market-crash-what-are-treasury-yields-stocks-economy-americans-2023-10

    4. MARKETS
      Asian stocks slump to 11-month lows as higher-for-longer rate fears persist
      REUTERS OCT 26, 2023 / 08:55 AM IST

      – A rebound in U.S. home sales was the latest trigger for concern in the bond market. Corporate earnings have also been mixed. Alphabet shares logged their worst session since March 2020 overnight, dropping 9.5% as investors were disappointed with stalling growth in its cloud division.

      – Asian stocks slid to 11-month lows on Wednesday, U.S. futures dropped and the dollar surged as Treasury yields spiked back toward peaks on fears that U.S. interest rates will stay high.

      A rebound in U.S. home sales was the latest trigger for concern in the bond market. Corporate earnings have also been mixed. Alphabet shares logged their worst session since March 2020 overnight, dropping 9.5% as investors were disappointed with stalling growth in its cloud division.
      …
      https://www.moneycontrol.com/news/business/markets/asian-stocks-slump-to-11-month-lows-as-higher-for-longer-rate-fears-persist-11599971.html

      1. Newsletter
        Investing
        What Wild Bond Moves Mean for Individual Investors
        By Suzanne Woolley
        October 26, 2023 at 1:05 PM EDT

        “Brutal rout.” “Truly historic.” “The makings of a ‘potentially vicious cycle.’” Who knew the market for US Treasuries could be so exciting?

        The past few weeks in bond markets have been a wild ride for an area most people find boring.
        …
        https://www.bloomberg.com/news/newsletters/2023-10-26/should-i-buy-bonds-a-guide-for-us-treasuries-in-your-portfolio

      2. Financial Times
        Corporate bonds
        US companies shy away from debt markets as Treasury rout drives up costs
        Corporate bond and loan issuance on course for quietest October since 2011
        The 10-year Treasury yield this week climbed above 5% for the first time since 2007
        Harriet Clarfelt in New York YESTERDAY

        Turmoil in government bond markets has forced US companies to delay borrowing plans, making this the slowest October for debt issuance in more than a decade.

        US firms have raised just under $70bn from sales of bonds and leveraged loans so far this month, the quietest month so far this year and the weakest pace of borrowing in any October since 2011, according to data from LSEG. By number of deals, the total of 50 is the lowest at this point in the month in records going back 20 years.

        Bankers say the sharp rise in Treasury yields over the past month, which has fed through to higher corporate borrowing costs, has put off companies from tapping debt markets unless they have to.

        “Anyone who was thinking about opportunistically coming into this market is taking a step back,” said Richard Zogheb, global head of debt capital markets at Citi.
        …

      3. Financial Times
        Opinion Adventurous Investor
        Bonds look an attractive option again
        Many investors are beginning to buy low-risk government securities
        David Stevenson yesterday

        Unless you’re a regular FT reader, the biggest story you won’t have read about in most newspapers in the past few weeks has been the remorseless rise in yields on US government bonds with maturities of 10 years or more.

        The crucial US 10-year yield has breezed past 5 per cent as investors have sold over fears that inflation might stay higher in a world drowning in government debt funding. It’s the first time we’ve seen a yield that high since 2007.

        There are lots of factors at work here, but most observers argue that the chief culprit is a “higher for longer” narrative, which suggests both interest rates (above 5 per cent) and inflation rates (in a range between 3 and 6 per cent) will remain elevated.

        The pain has been most acute for longer-maturity government bonds because these are the most sensitive to changing expectations of long-term inflation (and rates).
        …
        Sticking with US government bonds, long-dated index-linked bonds are worth a look, with yields in real terms of 1.5 per cent (or more). These can come with very high levels of volatility, though, with a price movement greater than bitcoin over the past couple of years.
        …

    2. The description is pure gold. TBH it sounds like it was written by ChatCPT with an instruction to pile on the schlock.

      I really don’t know if the house is worth saving, but it’s on a crappy triangular piece of land surrounded by other houses and a road. No thanks.

  17. Ok, so they released some military gun instructor, who had been in a mental institution for having visions of shooting up people. Suspect is at large in Maine after killing 22 , injuring dozens.
    What’s the message here. Your not safe, we got to take the guns.
    Its not a message of why did they release a nut that had visions of shooting people. Its not a message of what weird meds he might of been taking.

    But, the insanity of what the solutions are to any perceived problem. For example:
    Climate Change – Withdraw co2 , and all that sustains humans causing mass starvation.
    Covid 19, shut down the globe with countermeasure of fake expiermental vaccine, killing and injuring millions.
    Allow invasion of Borders, so US Citizens arent safe.
    Allow high crime because US is racist.
    Transgender rights attack on children and parents rights. Transgender males destroying female sports.
    Whites are bad, Trump supporters are enemy of State, proxy wars, any division that can be promoted.
    Tear down all systems that function for system that arent functional.
    The main point is that their solutions to any problem is wacko, insane, not logical, and ridicules.
    And , censoring any dispute to the narratives of the solutions to defraud and brainwash the masses is the weapon of fake world.

    1. The main point is that their solutions to any problem is wacko, insane, not logical, and ridicules.

      Some believe that it is demonic.

  18. I need my 401(K) money now: More Americans are raiding retirement funds for emergencies

    https://finance.yahoo.com/news/401-k-money-now-more-092953575.html

    More people are making hardship withdrawals from their 401(k) accounts, raiding retirement funds to cover emergency medical expenses, or to avoid losing a home.

    Hardship withdrawals from Fidelity Investments 401(k) accounts have tripled in five years, according to a report from the investment firm. The share of plan participants withdrawing funds rose from 2.1% in 2018 to 6.9% in 2023.

    “It’s a big problem, and it’s a growing problem,” said Kirsten Hunter Peterson, vice president of thought leadership at Fidelity.

    Vanguard reports that hardship withdrawals have doubled in a four-year span, from a monthly rate of 2.1 transactions per 1,000 participants in 2018 to 4.3 in 2022.

    Americans who tap retirement funds to cover an urgent expense often act out of desperation, investment experts say. They may lack emergency savings and live on too tight a budget to risk taking out a loan.

    “What we know is that people will dip into their 401(k) when they don’t have any other savings tool available to them,” Peterson said.

    Yet, taking a hardship distribution from a traditional 401(k) plan is far from ideal, financial planners say.

    Hardship withdrawals from a 401(k) should be a ‘last resort,’ experts say
    The IRS treats the money as taxable income. You may also face an additional 10% tax penalty for making an early withdrawal from your retirement account. (The IRS publishes a handy list of exceptions to that penalty.) You aren’t allowed to repay the funds, and you will miss out on the compounded interest those dollars might have earned between now and your retirement.

    The costs can be steep. Let’s say you have a 401(k) with a $38,000 balance, and you need $15,000 for an unexpected expense. To cover all the taxes, including the 10% penalty, you would have to withdraw a total of $23,810, leaving only $14,190 in your depleted account, according to an example provided by Fidelity.

    “We see it as a last resort,” said Andrew Fincher, a certified financial planner in Vienna, Virginia. “It’s not a great place to go.”

    The rise in hardship withdrawals comes at a moment when, compared to four or five years ago, many Americans are spending more and saving less.

    Workers are saving 3.9% of their disposable income, as of August, compared with 6.6% in August 2018, according to federal data.

    Saving money is hard these days, because inflation is up. Annual inflation hit a 40-year high of 9.1% in June 2022. The annual rate eased to 3.7% in September, although that figure remains higher than the Fed’s target of 2%. Through much of the past decade, prices rose by 1% or 2% in a typical year.

    The nation stockpiled savings amid the COVID-19 pandemic, an era of stay-at-home orders and federal stimulus checks that pushed the national savings rate to historic levels.

    That era is over. Today, just under half of American adults have enough emergency savings to cover three months of living expenses, according to a recent report from Bankrate, the personal finance site.

    Hardship withdrawals are rising amid nagging inflation, steep interest rates
    Experts say the rise in hardship withdrawals reflects a confluence of economic forces, including rising prices, high interest rates, and the end of the pandemic savings binge.

    The hardship withdrawal is tailored for workers who face “an immediate and heavy financial need,” according to IRS rules.

    You probably can’t take a hardship withdrawal to buy a boat or a home theater system, the IRS says. But you can take one to cover costly medical care, a home purchase, college tuition or funeral expenses, or to prevent foreclosure or eviction. You withdraw only what you need to cover the hardship.

    Housing and medical costs are the leading reasons for hardship withdrawals, according to Vanguard data. In 2022, 36% of withdrawals went toward avoiding foreclosure or eviction, and 32% covered medical expenses.

    Many financial advisers regard the hardship withdrawal as one of the worst financial moves a worker can make. But some scenarios are even worse.

    “If you’re going to be foreclosed out of a house, not getting foreclosed out of a house may be more important than saving for retirement,” said Craig Copeland, director of wealth benefits research at the Employee Benefit Research Institute.

    In 2018, Congress eased restrictions on hardship withdrawals for American workers facing dire need. Among other changes, lawmakers removed a requirement for workers to borrow against their 401(k) before taking a hardship withdrawal.

    Which is better? Withdrawing from a 401(k) plan, or borrowing against it?
    Borrowing against a 401(k) remains a viable alternative to withdrawing funds. Workers may borrow up to half of their account balance, up to a maximum of $50,000, and repay the money through payroll deductions.

    Fincher, the Virginia financial planner, had a client who needed $40,000 to cover an unexpected medical expense.

    “They did not have any savings for this. Their insurance was not able to cover what they needed,” he said.

    Fincher recommended that the client borrow the funds from their 401(k). When you borrow against a 401(k), you repay the loan, plus interest, to yourself. The interest helps you recover the income you lost by removing the funds from your investment account.

    But Fincher’s client chose a hardship withdrawal. That option freed them from large monthly loan payments. Instead, the client increased their 401(k) contributions to restore the lost funds.

    The share of Fidelity plan participants who borrowed against their retirement funds dipped from 6.5% in 2018 to 5.7% in 2023. All told, 12.6% of participants borrowed or took hardship withdrawals from their 401(k) plans in 2023, compared to 8.6% in 2018.

    “Historically, we have guided people away from taking hardship withdrawals,” said Peterson, of Fidelity. “We generally don’t want folks to dip into their long-term retirement savings to cover everyday or emergency expenses.”

    Fidelity has worked with employers, including Whole Foods Market and Starbucks, to offer emergency savings accounts to workers. The initiatives encourage employees to make automatic contributions into personal savings accounts, in much the same way they would fund a 401(k).

    “A lot of folks have gotten used to thinking of their retirement savings as their emergency savings,” Peterson said, “because there is no other source of savings available to them.”

    1. On the other hand, taking a disbursement during times of prolonged high monetary inflation and government suppressed interest rates might be a brilliant financial move.

  19. (Yet another non-housing related article …)

    Desperate To Sell Ukraine War, Biden Pathetically Appeals To Profit Motives

    https://www.zerohedge.com/geopolitical/desperate-sell-ukraine-war-biden-pathetically-appeals-profit-motives

    With prior narratives increasingly incapable of sustaining Americans’ enthusiasm for pouring weapons into the West’s proxy war in Ukraine, the Biden administration is now using a pitch that’s both refreshingly and appallingly honest: promoting the Ukraine war as a way to enrich the U.S. arms industry and its employees.

    The new angle comes after Americans have been subjected to a succession of pitches aimed at selling a war that’s utterly irrelevant to U.S. security interests. We’ve been variously told the war is necessary to defend democracy, to deter Putin’s aggression, to degrade Russia’s army, and even to deter China from invading Taiwan. With support for the war sagging across the political spectrum — and a growing number of Republican legislators saying enough is enough — the propaganda machine is increasingly grasping at straws

    (A chart goes here.)

    We got our first taste of the new cash-centric, Keynesian war-pitch in Biden’s prime-time Oval Office address last week, which was aimed at selling a $106 billion funding request that will furnish more aid to Ukraine and Israel, with other vote-getting goodies thrown in.

    The speech positioned aid to Ukraine and Israel necessary to prevent the destruction of the two countries’ (overrated) democracies. But then, in a discordant note, Biden awkwardly pivoted to the supposed economic benefits that will come from borrowing even more money and shoveling it into the coffers of weapon manufacturers:

    “We send Ukraine equipment sitting in our stockpiles. And when we use the money allocated by Congress, we use it to replenish our own stores, our own stockpiles with new equipment. Equipment that defends America and is made in America. Patriot missiles for air defense batteries, made in Arizona. Artillery shells manufactured in 12 states across the country, in Pennsylvania, Ohio, Texas. And so much more.”

    That was just the opening salvo of the administration’s new money-centered appeal. It’s likely to fall flat with the average citizen, but they’re not the principal audience anyway. In the US empire, the only hearts and minds that matter win are the ones in the House and Senate.

    Underscoring that fact, Politico has obtained talking points being distributed by the White House to Capitol Hill’s leading warmongers. In part, the document reads:

    “This supplemental request invests over $50 billion in the American defense industrial base — ensuring our military continues to be the most ready, capable, and best equipped fighting force the world has ever seen — and expanding production lines, strengthening the American economy and creating new American jobs.”

    Politico reports that White House officials are also circulating “slides showing nearly $20 billion in investment in the industrial base via U.S. support for Ukraine. That includes nearly $3.1 billion in contracts targeted toward expanding the nation’s industrial base capacity, including increasing artillery production approximately six-fold over three years.”

    In recent months, anyone with sound morals and a clear mind cringed as various officials started publicly celebrating the Ukraine conflict as a means of weakening Russia without any loss of American life or limbs. One of the worst examples of that casual ghoulishness where Ukrainian lives are concerned came from Senator Mitt Romney, who cheerfully described the billions being poured into Ukraine as “about the best national defense spending I think we’ve ever done. We’re losing no lives in Ukraine!”

    Now, we see the War Party graduating from public indifference to Ukrainian lives to spotlighting the profits and overtime pay to be reaped from the Ukraine meat-grinder. Maybe we should applaud it as truth in advertising: After all, the war was always about enriching and empowering the military-industrial complex anyway.

  20. Tucker Carlson Warns ‘Really Dramatic Abrupt Change Is Coming’

    by Steve Watson
    October 26th 2023, 5:24 am

    “If something really dramatic in your country happens — like young people can’t, I don’t know, get married, you know, or buy houses or have any hope for a future that approaches, you know, the middle class upbringing they had — then you’ve got a huge problem and someone should be responding to that,” Carlson urged.

    He added, “And if your economy is like on the brink of collapse, you know, if your country is literally bankrupt, I hope someone would say that.”

    “When every person, 350 million Americans, everyone regardless of political affiliation can feel that something bad’s coming. Everybody knows that,” Carlson continued.

    https://www.infowars.com/posts/tucker-carlson-warns-really-dramatic-abrupt-change-is-coming/

  21. American Oligarchy: Meet the Billionaire Mega-Donors Behind the Biden Presidency

    ALEXANDER MARLOW
    26 Oct 2023

    Joe Biden is the quintessential oligarch. He has empowered America’s moneyed elite, and they have empowered him. Biden’s 2020 campaign was the first to raise over $1 billion. Democrats raised $600 million more in “dark money” than Republicans in 2020. Look for those numbers to explode even higher in 2024.

    It is important to understand a key principle in modern Democratic politics: if you’re not at the table, you’re on the menu. Today, it’s Joe Biden’s table, and he’s happy to provide the entertainment.

    Remember, unlike Joe Biden, all of these oligarchs are good with money. They aren’t giving away tens of millions of dollars out of the goodness of their heart. They want something in return. In each and every case, Joe Biden serves a purpose for them — maybe many purposes.

    Let’s meet Joe’s billionaire cabinet:

    https://www.breitbart.com/politics/2023/10/26/american-oligarchy-meet-the-billionaire-mega-donors-behind-the-biden-presidency/

    2. Oh please, the other 80% didn’t find a place to go. They just didn’t bother to re-apply. They fully intend to the squat until they are forcibly removed, at which point they will scream about ripping families apart or whatever.

  23. Jenna Ellis Guilty Plea Underscores the Absurdity of DA Fani Willis’s RICO Case

    Willis wildly overcharged the election-interference case and is now picking off some defendants on minor charges.

    Former Trump 2020 campaign attorney Jenna Ellis pled guilty this morning in the Georgia election-interference case to a minor offense — aiding and abetting the provision of false information to the state — for which she will receive no jail time.

    Fulton County district attorney Fani Willis has hyped her prosecution of Donald Trump, Ellis, and 17 others affiliated with the Trump campaign as a racketeering-conspiracy case, depicting the former president as the head of an organized-crime enterprise. I have contended that Willis does not have a RICO case under Georgia’s analogue to the federal Racketeer Influenced and Corrupt Organizations Act of 1971. The throng Willis has indicted did not function as an identifiable criminal “enterprise” as defined in RICO, and she lacks a single criminal objective as to which she can say all 19 defendants agreed. (It is not a crime to seek to reverse an election result — indeed, Georgia law provides for legal challenges to election outcomes.)

    What Willis has, instead, is evidence that some state criminal offenses — minor in comparison to those at issue in the typical RICO case — were committed in the course of the campaign’s schemes to overturn the 2020 election. Consistent with that, Ellis is now the fourth defendant to plead guilty in recent days. None has pled guilty to the RICO conspiracy that Willis alleged in Count One — the overarching “offense” that frames her prosecution.

    Because all four guilty-plea defendants are now cooperating with the state, the lack of a RICO plea is telling: Ordinarily, prosecutors require the first cooperators in a major case to plead guilty to the major charges, offering them sentencing leniency in exchange for their testimony against other defendants. Those kinds of pleas convince the public that there is a strong case and put pressure on other defendants to plead guilty. But not only have none of Willis’s cooperators conceded that there was a RICO conspiracy, much less pled guilty to it; none of them faces even a single day of imprisonment.

    After the indictment, I argued that the case against Ellis should be dismissed. Besides the deeply flawed RICO allegation, she was charged only with the Georgia crime of soliciting the commission of a crime. As Willis has pled it, I believe this charge (Count Two of the indictment) is constitutionally infirm. Willis’s theory is that Ellis and several others (Rudy Giuliani, John Eastman, and Ray Smith) committed it by petitioning the Georgia state senate, at a subcommittee hearing on December 3, 2020, to appoint a Trump slate of electors (as an alternative to the Biden electors whom the state did certify after Biden narrowly won the popular vote in Georgia’s presidential election). The solicitation charge is untenable because (a) the Constitution guarantees the right of Americans to petition government, and (b) even if Georgia legislators had wrongly appointed an alternative slate of electors, which they didn’t, it would not have been a prosecutable crime.

    Not surprisingly, then, Ellis did not plead guilty to the dubious charges against her in the indictment. Instead, to obtain the guilty plea, Willis filed a new one-count charging document accusing Ellis of aiding and abetting false statements and writings. This is about as trivial as it gets. The prosecutor is not even alleging that Ellis herself provided false information to state officials, only that she assisted more senior counsel — in particular, it appears, Rudy Giuliani — in providing false information.

    In the indictment (to which, again, Ellis did not plead guilty), it is alleged (in Count Three, in which Ellis was not charged) that, at the same December 3 state-senate subcommittee hearing that Ellis attended, Giuliani falsely contended that (a) 96,600 mail-in ballots had been counted even though there was no record of those ballots having been returned to a county elections office; and (b) a Dominion Voting Systems machine in Antrim County, Mich., had recorded 6,000 votes for Biden that were actually cast for Trump.

    It is not clear from what I’ve seen of the new charging documents that these were the false representations of which Ellis pled guilty to aiding and abetting the dissemination. Nevertheless, in court this morning, during her allocution (the part of a guilty-plea proceeding where the defendant personally relates what she did that makes her guilty), Ellis said she had helped present election claims to the state without performing due diligence to ensure their accuracy. (The video recording of Ellis’s allocution is here.)

    In exchange for her plea to this felony charge, Ellis was sentenced to five years of probation, ordered to pay $5,000 in restitution, and directed to perform 100 hours of community service. She was further required to write a letter of apology to the citizens of Georgia (she has already fulfilled that condition, and she reiterated the apology in her above-linked statement in court this morning).

    While the media–Democrat complex is salivating that Trump will be sunk by the cooperation of Ellis and the other three defendants who’ve pled out to minor charges with no jail time in recent days (Kenneth Cheseboro, Sidney Powell, and Scott Hall), that seems like wishful thinking. Again, none of the defendants has pled guilty to racketeering nor provided any indication that Trump and his remaining co-defendants violated RICO.

    As I noted in connection with Powell’s plea last week, she may have relevant testimony regarding Trump, but it’s not necessarily incriminating (in fact, at a White House meeting in mid-December 2020, Powell reportedly made a lunatic proposal that Trump seize state voting machines, which Trump actually rejected). Ellis, like Cheseboro, had direct communications with Giuliani; that may implicate the former New York mayor more deeply in the alleged provision of false information to state officials and the so-called fake electors scheme, but it does not necessarily implicate Trump. The former president appears to have dealt directly with Giuliani much more than with the other lawyers; he will undoubtedly claim that he was relying on his lawyers — such as Giuliani, Eastman, Powell, Cheseboro, and Ellis — to ensure the accuracy of information on which the campaign was relying.

    Of course, if Ellis were to testify that she and the other lawyers knew the information they were peddling was false, that would be damaging to those lawyers — at least on a false-statements charge. As I detailed back in March, when Ellis was censured by the state supreme court in Colorado (where she is licensed to practice law), she admitted to making various public misrepresentations in claiming election irregularities on Twitter and various news programs.

    The recent spate of pleas is being presented by DA Willis’s office and her champions in the press as a sign of prosecutorial momentum. But it would be more accurate to say that Willis wildly overcharged the case and is now picking off some defendants on minor charges — with no-incarceration sentences that hardly befit a grand conspiracy capable of bringing American democracy to the brink of destruction.

    https://www.nationalreview.com/2023/10/jenna-ellis-guilty-plea-underscores-the-absurdity-of-da-fani-williss-rico-case/

  24. ‘Trouble began for investors this spring when the company stopped paying monthly interest payments, citing challenges hitting the slowing real estate market. It’s not clear how many investors bought promissory notes from iCap companies or how much the company owes, but bankruptcy filings list more than 2,700 people and entities owed money and total financial liabilities between $100 million and $500 million’

    These guys were selling paper. I expect we’ll be hearing more about this.

  25. ‘My clients — all of whom are from China, and many of whom do not speak English — invested their savings with iCap so they could improve their lives or the lives of their families here in the U.S…The investors ‘have been completely devastated by the revelations over the past few months’ and ‘are committed to holding accountable those who are found to have misled unsuspecting investors or who have engaged in other misconduct’

    Did you advise yer clients on the little feet stamping option John?

  27. ‘According to court records, in recent years it has secured hundreds of millions of dollars in loans to rapidly expand’

    Everybody was doing it. There’s a shortage you know!

    ‘But work has stalled on a half-dozen Vandyk projects. There are hundreds of preconstruction buyers and real estate agents waiting on Vandyk as well’

    Another fresh one. Many eye watering tales of woe to come here too.

    ‘said that agents who sold preconstruction units at Vandyk sites are still waiting for partial commissions that have been owed to them for years. ‘I’m not asking anybody to cry for real estate agents … I know about 40-50 agents that did that and did not get paid’

    I for one would be interested to know of this occasion where ‘asking anybody to cry for real estate agents … I know about 40-50 agents that did that and did not get paid’ Akshay. If you have some video of it, all the better.

    1. said that agents who sold preconstruction units at Vandyk sites are still waiting for partial commissions that have been owed to them for years

      If someone owed me money for years I would abandon all hope of ever collecting it.

  28. Citizen Free Press
    @CitizenFreePres

    KJP gives predictable answer when asked about Maine shooting:

    “Let’s work together to ban assault weapons and high capacity magazines.”

    https://x.com/CitizenFreePres/status/1717600855787003949?s=20

    End Wokeness
    @EndWokeness

    Kamala just said the quiet part out loud. They want to do what Australia did.

    Australia confiscated 650,000 legal guns from law-abiding citizens.

    https://x.com/EndWokeness/status/1717600619517599860?s=20

  29. News
    MacKenzie Capital Announces Tender Offer To BREIT Investors At 38% Discount
    NationalCapital Markets
    October 25, 2023 Dees Stribling, Bisnow National

    MacKenzie Capital Management is offering shareholders of Blackstone Real Estate Income Trust $9.27 per share, which the company says represents a 38% discount to BREIT’s estimated net asset value of $14.88 per share.

    The California-based private real estate investor stressed that it is offering an immediate cash payment for the shares, albeit at a discount.
    …

  31. Oregon Schools Eliminate Proficiency Requirements in Math and English for Students

    https://jonathanturley.org/2023/10/24/oregon-schools-eliminate-proficiency-requirements-in-math-and-english-for-students/

    Two years ago, we discussed how Oregon schools solved declining scores by eliminating their requirements that graduates actually attain levels of proficiency in basic subjects like math and English. In 2021, the changes were portrayed as just a temporary measure due to the pandemic. However, the state just extended it five more years. It declared that such proficiency tests are unfair to students of color. So, rather than give these students the level of education needed to excel in the modern workplace, schools will now process them out with degrees and call it social progress.

    Public schools across the country continue to fail inner city children and appear to be be giving up on reversing this trend. In Baltimore, a survey found that forty percent of schools did not have a single student proficient in math. Rather than reverse that trend, the schools are just waiving the tests and graduating the students.

    What is so frustrating is reading about failing school systems waiving proficiency and claiming that it is better for minority students.

    American education faces the perfect storm. Despite record expenditures on public schools, we are still effectively abandoning students, particularly minority students, in teaching the basic subjects needed to succeed in life. We will then graduate the students by removing testing barriers for graduation. Then some may go to colleges and universities that have eliminated standardized testing for admission. At every stage in their education, they have been pushed through by educators without objective proof that they are minimally educated. That certainly guarantees high graduation rates or improved diversity admissions. However, these students are still left at a sub-proficient state as they enter an increasingly competitive job market and economy. Any failures will come down the road when they will be asked to write, read, or add by someone who is looking for actual work product. They will then be outside of the educational system and any failures will not be attributed to public educators.

    If we truly care for these students, we cannot rig the system to just kick them down the road toward failure. It is like declaring patients healthy by just looking at them and sending them on their way. We have the ability to measure proficiency and we have the moral obligation to face our own failures in helping these kids achieve it.

    Oregon board members said proficiency is now unnecessary and harmed minority students since higher rates of students of color failed to reach these levels, The Oregonian reported. The question is how the board is defining what is necessary. If any of these students hope to escape cycles of poverty, they have to be able to do better than the status quo. These boards are condemning them to the same endless cycle.

    These proficiency standards were developed by academics to establish what they viewed as the education needed to excel in our society. Now, the boards are simply downgraded to meet their own lack of academic performance. State Sen. Michael Dembrow told the Oregon Capital Chronicle insists “I think there’s an assumption here that teachers are just graduating students, who don’t have the necessary competencies and I don’t know what the justification is for that.”

    The point is that these students do not need to meet some low level of competence in order to be able to aspire to more than menial or low-level positions.

    The move in Oregon occurs at the same time as a national effort to eliminate standardized testing and scores on every level of our educational system. For example, the University of California system joined the “test-blind” movement and said it would end the use of the SAT and ACT in its admissions decisions. The move followed a decision of California voters not to lift the long ban on affirmative action in education under state law. Many have decried standardized testing as vehicles for white supremacy.

    University of California President Janet Napolitano sought to eliminate standardized testing by assembling the Standardized Testing Task Force in 2019. Many people expected the task force to recommend the cessation of standardized testing. However, the Task Force surprised many (most notably Napolitano herself) by releasing a final report that concluded that standardized testing was not just reliable, but that “at UC, test scores are currently better predictors of first-year GPA than high school grade point average (HSGPA), and about as good at predicting first-year retention, [University] GPA, and graduation.” It even found that “test scores are predictive for all demographic groups and disciplines … In fact, test scores are better predictors of success for students who are Underrepresented Minority Students (URMs), who are first generation, or whose families are low-income.”

    Despite those conclusions, Napolitano simply announced a cessation of the use of such scores in admissions.

    I previously wrote how some teachers and administrators are rapidly killing public education.

    Many of us have advocated for public education for decades. I sent my children to public schools, and I still hope we can turn this around without wholesale voucher systems. Yet teachers and boards are killing the institution of public education by treating children and parents more like captives than consumers.

    As public schools continue to produce abysmal scores, particularly for minority students, board and union officials have called for lowering or suspending proficiency standards or declared meritocracy to be a form of “white supremacy.” Gifted and talented programs are being eliminated in the name of “equity.”

    Once parents have a choice, these teachers lose a virtual monopoly over many families, and these districts could lose billions in states like Florida.

    This is precisely why school systems like the Seattle public schools are facing budget shortfalls as families vote with their feet. These families want a return to the educational mission that once defined our schools.

    The lowering of these standards reflect a lack of proficiency in public education. Rather than meet the standard previously set for success in society, Oregon will now codify pandemic measures to allow students to graduate with lower levels of math, English, and science knowledge. The people of Oregon are clearly not going to stop this trend and they are entitled to set school policy. Just don’t claim it is good for these students.

    1. The Financial Times
      3 hours ago
      European stocks fall in early trade
      George Steer in London

      European stocks fell in early trade on Friday as investors digested the latest third-quarter results and looked ahead to a busy day of US economic data.

      The region-wide Stoxx Europe 600 fell 0.3 per cent, dragged lower by a 12.6 per cent decline for NatWest. France’s Cac 40 lost 1.3 per cent, Germany’s Dax was steady and London’s FTSE 100 fell 0.1 per cent. Consumer cyclicals were among the worst performers while energy stocks pushed higher.
      …

    2. DOW FUTURES +0.10%
      S&P 500 FUTURES +0.45%
      NASDAQ 100 FUTURES +0.87%

      The bond market is acting like it’s 1969, when rising yields preceded a recession, JPMorgan says
      Filip De Mott
      Oct 26, 2023, 6:57 AM PDT
      Treasury check and dollars
      NoDerog/Getty Images

      – The surge in long-duration Treasury yields mirrors the 1969 Fed tightening cycle, JPMorgan said.

      – That year, yields rose for three months after the final Fed interest rate hike.

      – The trend ended with a recession, and today’s yields might only stop climbing when a downturn kicks in.
      …
      https://markets.businessinsider.com/news/bonds/bond-market-bear-steepening-yield-curve-recession-indicator-economic-outlook-2023-10

    3. 18 hours ago – Economy & Business
      Hot growth summer: How the sure-bet recession was foiled
      Neil Irwin, author of Axios Macro
      Data: Bureau of Economic Analysis; Chart: Axios Visuals

      This time a year ago, the Federal Reserve was raising interest rates three-quarters of a point at a time, big-name companies were announcing layoffs, and a 2023 recession appeared, to many analysts (and, we confess, economics writers) to be baked into the cake.

      Why it matters: There is more underlying strength in the U.S. economy, and especially consumer demand, than nearly anybody thought. That has helped boost growth and the job market, but makes future progress in bringing down inflation less certain.
      …
      https://www.axios.com/2023/10/26/us-economy-strength-uncertain-inflation
      https://www.axios.com/2023/10/26/us-economy-strength-uncertain-inflation

    4. Financial Times
      FT Alphaville
      US Treasury bonds
      Bond markets are doing the Fed’s work
      A decent amount of it too, it seems
      It’s good to get a break sometimes
      Alexandra Scaggs yesterday

      The Treasury sell-off is doing its own work tightening US financial conditions.

      Yields on long-dated bonds have jumped this year, with the 10-year yield up ~1.5 percentage points and the 30-year yield up ~1.4pp in the past six months. While plenty of attention is paid to the Fed’s policy rate, the longer-dated bonds are benchmarks too, so they have their own effect on financial conditions. (See all the Discourse about Greenspan’s “conundrum” in the early stages of the prior tightening cycle.)

      There’s apparently no conundrum this time around, which raises an interesting question: Exactly how much tightening comes from the rise in long-dated Treasury yields?

      Deutsche Bank provides an estimate today, arguing that the sell-off it has done the work of approximately “three 25-bp rate increases.”

      To arrive at that number the strategists aim to replicate the Fed Board’s financial conditions index, rather than the overrated proprietary FCIs that almost everyone appears to have developed. And to make a more responsive metric, DB modelled daily estimates for the index, as the Fed’s is only released once a month.
      …

    5. DOW FUTURES +0.00%
      S&P 500 FUTURES +0.40%
      NASDAQ 100 FUTURES +0.85%

      HOME NEWS STOCKS
      The S&P 500 is on the verge of a technical breakdown. Here’s the sell signal to watch for.
      Matthew Fox Oct 26, 2023, 11:30 AM PDT
      NYSE trader
      Spencer Platt/Getty Images

      – The S&P 500 is on the verge of a technical breakdown, according to Fairlead Strategies’ Katie Stockton.

      – Stockton said that 4,180 is a key support level that needs to be preserved to prevent further selling.

      – Extreme sentiment readings suggest to Stockton that a reversal in stock prices could be imminent.
      …
      https://markets.businessinsider.com/news/stocks/stock-market-outlook-sp500-on-verge-of-technical-breakdown-support-2023-10

      1. “If 4,180 fails to hold as support for the S&P 500, Stockton identified 3,920 as the next support level to watch, which represents potential downside of 6% from current levels.

        The S&P 500 traded below 4,180 for the first time since June on Thursday, trading to as low as 4,151.”

        Gulp…

  35. The first Nobel Prize in Economics was awarded in 1969 and the USD was taken off the gold standard in 1971 and while there may or may not be a connection between the two, the fact remains that since then the USD has lost more than 90% of its purchasing power on its way to its real value, i.e., zero, so measuring the price of anything with a meaningless number written on a piece of paper and foisted upon the public at the gunpoint of the Legal Tender Law is an exercise in futility. Rather, one should measure it by its equivalence to some useful asset and the Big Mac comes to mind.

    Only the government can take a perfectly useful commodity like paper, slap some ink on it, and make it completely worthless. – Ludwig von Mises

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