Posted on 04/08/2022 6:13:53 AM PDT by Browns Ultra Fan
As the US Treasury 2-year yield hits 2.507% (up from 0.128% when Biden was installed as President) and the number of Fed rate hikes over by February 2023 hits 9.6, Bankrate’s 30-year mortgage rate breached the 5% mark at 5.04%.
The most recent data from on existing home sales show YoY sales in negative territory as The Fed begins in monetary fireball tightening.
The Fed’s minutes from the most recent meeting indicates that The Fed will shedding $95 billion a month from it swollen balance sheet. At almost $9 trillion mostly populated by Treasuries will be the first asset to run-off the balance sheet (there is almost $1 trillion of Treasuries maturing in 2022 and $856 billion maturity in 2023, etc), The Fed plans to shrink the balance sheet while, at the same, raising The Fed Funds target rate from it near zero levels.
The Federal Reserve has ignoring rules like the Taylor Rule since the financial crisis of 2008-2009, but seemingly are paying attention to the Taylor Rule because of 7.9% inflation. The Taylor Rule is suggesting a 20.42% Fed Funds target while the current target rate is 0.50%. Now THAT would be a real shock to the economy.
Powell: “Unleash the Fed Fireball on the 99%!”
(Excerpt) Read more at confoundedinterest.net ...
And down comes home prices.
They killed small businesses successfully with the Covid hoax. With inflation at an all time high that will kill off even more businesses. Might as well kill the housing industry as well.
ALL ON PURPOSE.
ALL ON PURPOSE.
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The greatest harm was done by using the Russo Ukie war to finish us off. Senile Joe’s weaponizing the USD with sanctions ( and freezing funds - stealing) started a new era, dethroning the USD and destroying the petro dollar. Prepare for $7-10 trillion USD’s coming home, unwanted dollars, the stake through our heart.
…..and Vlad outsmarts Senile Joe once again, checkmate.
Everyone should refi now if they haven’t already, if they need to get out of an adjustable mortgage and switch to a fixed rate.
I don’t recall, but have heard that during the Carter years, some mortgages hit 16 and 17 percent. Just doing the math on that, to figure a monthly payment on a mortgage at such high rates, will make your head spin.
Hopefully we aren’t headed back to those levels.
Yes, I also wouldn't buy a house right now unless absolutely necessary. I was a homeowner during the Carter years, and my mortgage was at 14%? On the flip side, houses were far, far less expensive so payments reflected that.
Taxation is theft. Inflation is theft.
The sooner you realize those two TRUTHS and get your financial house in order, the better off your will be in life.
And remember: You. Are. On. Your. Own. Ain’t nobody in ‘government’ gonna save you!
It’s really that simple.
It could not be more clear. The housing/credit bubble is going down hard.
IMO it will be a lot “harder” than the last one.
If I owned a home in an urban/suburban area and owed a lot of money on it, I’d sell as fast as I could. Otherwise I could find myself either walking away or going in foreclosure in a year, as so many people did last time.
That way, CDs can yield 5% with the bankers getting 2%.
A lot of retirees counted on pulling their money out of stocks, buying CDs and living off the interest.
Since they can't, they are hanging onto as much of their money as they can and slowly spending the principal.
If they could get 5%, a LOT of money would start flowing that is now being held.
My folks had one of those high-interest mortgages in the 70’s.
My Grandpa was so stinkin’ MAD at Carter, that he paid off their mortgage and had them pay him back, sans interest.
It was a good investment for all concerned as housing rebounded nicely under Reagan, plus it stuck it to Mother Government, which I was encouraged to do at every opportunity, LOL!
When I came back from Army Basic Training and AIT (further schooling) I wanted to buy a car. It was a whopping $1,700.00 and I had half of it saved up in cash. I went to ‘The Bank of Grandpa’ and got a loan for the remainder after he had inspected the car. Paid him back faithfully every month at the amount we agreed to. When I had paid him back 1/2 of what I owed, he tore up our contract. “I just wanted to see if you were as good as your word, Kid. And you were.”
I retired debt-free at age 56. (The only debt I had was my farm; no vehicle debt, no credit cards.) Thanks for all the lessons along the way, Grandpa!
We CAN overcome whatever Mother Government throws at us. It’s not FUN. It’s not PRETTY. But it CAN be done!
And if you’re over 50 years of age and still dealing with debt, I’d suggest some lifestyle changes. I have friends my age, similar incomes as me, yet are loaded in debt. Debt makes me feel like a serf, so go without it. Too bad I can’t go without taxes to really undo that serf feeling. Other people think different about debt I guess, whatever.
“started a new era, dethroning the USD and destroying the petro dollar.”
That the equivalent of destroying the Easter Bunny. Once again, oil is about ONE PERCENT of all dollars traded. HOW ON EARTH WOULD CHANGING 1 PERCENT TO .75 PERCENT MAKE ANY IMPACT? Just repeating that kook garbage over and over and over again is not magically going to make it come true.
This reminds me of the math challenged eco nuts who claim man making a minute change in the carbon dioxide content of the earth’s atmosphere will usher in planetary apocalypse.
I have been noticing more For Sale signs recently
You are comparing apples and oranges. Go read the fine print on the link you provided. Sarting in 2020, M1 is calculated differently. You have to go to the FED’s wdb site and read the technical bulletin.
“Beginning with the May 2020 observation, M1 will increase by the size of the industry total of savings deposits, which amounted to approximately $11.2 trillion. “
I have been noticing more For Sale signs recently
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Those folks have already missed “the top” and may get hosed.
Like stock traders who hold too long due to FOMO(Fear Of Missing Out) and sell on the red line down or at a loss. Folks on edge are going to get destroyed just like last time.
:^)
There is no reason to really sell.
Just buy when the prices drop and rent.
Debt is Slavery.
New York
CNN Business
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Americans got into a lot more debt in February as rampant inflation kept up the pressure, the Federal Reserve’s consumer credit report showed Thursday.
Debt levels jumped by nearly $42 billion to a total of almost $4.5 trillion. That’s an annual increase of 11.3%, seasonally adjusted, far outperforming economists’ expectations and setting a new high. In January, total credit had grown only 2.4%.
The Fed’s historical consumer credit data goes back to the early 1940s.
Do you think .gov claims that inflation is transitory, temporary may have encouraged consumers to use credit to maintain their lifestyle? Imho they are in for a rude awakening.
Great neeeewwwws for the construction building industry and suppliers.
And get rid of the older father worker and hire his son rreeeeel cheep.
DIRT. FILTH.
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