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June 25, 2019 | New Home Sales Plunge 35.9% in the West, 7.8% Overall, Prices Down 8.1

There is little to like in today’s residential sales report. New home sales dove 7.8% overall and prices also fell 8.1%. Economists expected a rebound in housing this month so they are no doubt shocked by the Housing Residential Sales report. New Home Sales Sales of new single‐family houses in May 2019 were at a seasonally adjusted […]

June 22, 2019 | Electric Car Major Headache: Waiting Hours for Charging Bay then Hrs to Charge

A trip from LA to Las Vegas and back takes 8 hours by a gas-powered car but 13 hours by an electric vehicle. The electric vehicle grand vision may flounder on something most drivers take for granted: a quick pit stop. The inconvenient truth of electric vehicles is they are terribly inconvenient to own and […]

June 20, 2019 | Hello Ten-Year One-Handle, Hello Gold

Gold blasted $48 higher today and the 10-year Treasury yield briefly fell below 2.0% with Mideast tensions rising. Mideast tensions are heating up as Iran Shoots Down US Drone: “You’ll Soon Find Out” if US Plans Strike Says Trump. I expect cooler tempers will prevail but who knows? US Treasury Yields Gold Above Major Resistance Finally! […]

June 17, 2019 | Ho Ho Ho It’s magic: Deutsche Bank, Market Cap $14B to Spin Off $50B in assets

Deutsche Bank, with a market cap of under $14 billion looks to spin off $50+ billion in allegedly productive assets. I am scratching my head a bit over this idea. From the expression on CEO Christian Sewing’s face, he is too. Please consider Deutsche Bank Plans Radical Overhaul With €50bn Hived Off to ‘Bad Bank’. Deutsche […]

June 11, 2019 | Debate Over Brexit Fee: Would Nonpayment Constitute Default? Who Owes Whom?

Round and round we go. After more than two years the UK and EU are still debating Brexit breakup fees. On March 29, 2017, the UK filed Article 50, triggering an exit process from the EU, but the UK is still trapped. Theresa May negotiated such a poor deal that the British Parliament would not […]

June 6, 2019 | 30-Minute Drone Deliveries Coming Up: FedEx Scrambles to Catch Amazon

FedEx just announced deliveries 7 days a week. Amazon shoots for 30-minute drone deliveries. The Wall Street Journal reports FedEx to Deliver Packages 7 Days a Week. “Online shopping is seven days a week,” FedEx President and Chief Operating Officer Raj Subramaniam said in an interview. “So there is increasing demand from online shoppers and e-commerce […]

June 5, 2019 | Stop Boris Campaign is Doomed from the Start: Prepare for No Deal

The bookmakers give Boris a 1 in 3 shot of becoming the next PM. Focus on reality, not bookie odds. The “Stop Boris” campaign is in full swing, but it’s as likely to be as much of a success as the “Anybody But Trump” Campaign in 2016. Stop Boris Theory Boris has to beat out […]

June 4, 2019 | Powell Ready to Cut Rates to “Effective Lower Bound” via “Conventional” Policy

Powell gave a speech today showing his resolve to support the markets. He suggested retiring the word “unconventional”. Let’s tune into to statements Powell made today at a “Conference on Monetary Policy Strategy, Tools, and Communications Practices“. Emphasis is mine. I’d like first to say a word about recent developments involving trade negotiations and other […]

June 3, 2019 | Gold Knocks Six Times on the Ceiling

Gold put in a strong performance today with the St. Louis Fed president presenting a case for cutting rates. St. Louis Fed president James Bullard helped light a fire under gold today, Yapping About Too Little Inflation and the Need for Rate Cuts. Technically speaking, the $1350 to $1370 area has been one tough nut for […]

June 2, 2019 | China Ready to Resume Talks With US: OK, But Under What Conditions?

A headline in the Wall Street Journal caught my eye today. It claims China is willing to talk with Trump. Please consider China Signals It Is Willing to Return to Trade Talks With U.S. A government policy paper on trade issues with the U.S. released Sunday accused Washington of scuttling the negotiations, which broke down in […]

May 28, 2019 | Surefire Recession Signal in Pictures

The strength of inversions widened today. That’s a strong recession warning, but it is not the actual recession signal. Inversions Widen Today’s bond market action is a strong follow-through on Friday’s action. Imminent Signal The recession imminent signal is not the inversion but a sudden steepening of the curve following a period of inversion. A […]

May 21, 2019 | National Average Rent Rises by 3.0 Percent

The national average rent price is $1,436. The pace of rent increases is the lowest in nearly a year. The Rent Cafe reports the Average Rent Reaches $1,436 in April. Key Points The national average rent reached $1,436 in April 2019, up by 3% ($42) year over year, and by 0.3% ($5) month over month, the […]

May 18, 2019 | No Toilet Paper Unless Critical: Musk, CFO to Approve “Literally” Every Expense

Tesla so badly needs cash that Musk will personally review and sign every tenth payment. The CFO will look at them all. On May 13, in Tesla Can’t Spare a Dime, the Wall Street Journal commented “Elon Musk’s electric-vehicle pioneer is running out of cash and out of time, even after a recent capital increase.” The […]

May 14, 2019 | Forecasters Miss Inflation Targets By a Mile: Steep Decline in Ag Export Prices

The consensus expected import prices to rise by 0.7% and exports by 0.5%. Instead, both prices rose by 0.2%. Missed by a Mile ​ The BLS report on Import and Export Prices for April 2019 has some interesting details, specifically bad for US farmers. First let’s look at the overall numbers. Import Prices ​ Import Price Synopsis […]

May 13, 2019 | Yield Curve Inverts in 28 Places: Recession Warning Resumes

After a brief respite, the yield curve is again flashing a bright recession signal. The curve is inverted in 28 places. Automatic Pilot Spotlight Let’s flashback to Fed Chair Jerome Powell’s statements following the December 19 FOMC meeting. Powell was asked about the Fed’s balance sheet and quantitative tightening. We thought carefully about how to normalize […]

May 12, 2019 | Judy Shelton, Trump’s Next Fed Choice, Favors a Gold Standard and Free Trade

Economist Judy Shelton, a Trump economic advisor and a gold standard advocate is rumored to be Trump’s next Fed pick. Bloomberg reports White House Considers Economist Judy Shelton for Fed Board The White House is considering conservative economist Judy Shelton to fill one of the two vacancies on the Federal Reserve Board of Governors that President […]

May 8, 2019 | US Warns UK Over Huawei and 5G Wireless

US Sec. of State Mike Pompeo warns the UK about 5G wireless. Pompeo threatens to end defense cooperation with the UK. Via the Guardian Live Blog, Pompeo warns the UK that Huawei 5G role could put defense cooperation with US at risk. Here are the main points from the press conference given by Mike Pompeo, the […]

May 7, 2019 | Miami Condo Prepares Landing Pad for Flying Cars

In what’s likely to be some sort of marketing ploy, a condo development in Miami is making preparations for flying cars. This George Jetson story is so absurd that I would have guessed Elon Musk or Trump was behind it. Nope. Here’s an announcement that’s safe to mock Flying cars haven’t landed yet, but this $600 […]

May 6, 2019 | China Nowhere Close to Becoming a Global Financial Center for Many Reasons

China lowered the official limit on US dollar withdrawals from $5,000 to $3,000. One woman could not get a mere $200. Crackdown on Withdrawals The South China Morning Post reports Chinese Banks Quietly Lower Daily Limit on Foreign-Currency Cash Withdrawals. The issue was thrust into the spotlight on Friday when a viral video clip showed a […]

May 4, 2019 | Uber’s Big Problem: It’s a Zombie Corporation That Can’t Make Any Money

Analysts are questioning Uber’s viability. Many are concerned it will never make a profit. There’s too much competition. Grandiose Plans Uber wants to become the Amazon of everything transportation related. But a key question remains: Can Uber Ever Make a Profit? In Uber’s vision of the future, most people won’t own cars. Riders will hop on […]

May 2, 2019 | Luxury Homes Sales Decline Most Since 2010 As Supply Soars

Supply of luxury $2.0 million homes is up four consecutive quarters but sales are down 16%, the most since 2010. In the luxury home market there is a mad dash for the exit. However, buyers are holding their noses as Luxury Home Sales See Biggest Slump in Nearly a Decade. Sales of homes listed at $2 […]

April 26, 2019 | Brexit Update: Less Than Half of UK, Italy, Czech Republic Wish to Remain in EU

Although less than half of the UK wants to stay in the EU, there is still no majority for any particular outcome. ​ The latest polls show Less than half of Britons would back staying in EU. However, there is still no majority for anything. The Eurobarometer survey on public opinion found that 45 percent of […]

April 25, 2019 | Durable Goods Orders Soar 2.7% With Aircraft and Cars Leading: Bond Market Yawns

Once again we have another seemingly hot economic report with the bond market giving a big yawn. The Advance Durable Goods report on shipments, new orders, and inventories lifted what had been a stagnating view of US manufacturing. New Orders New orders for manufactured durable goods in March increased $6.8 billion or 2.7 percent to $258.5 billion, […]

April 23, 2019 | New Home Sales Beat Expectations, Up Most Since November 2017

New home sales are up thanks to builder discounts and falling mortgage rates. The Census Department New Residential Construction report shows new home sale rose for the third month. Economists expected a pullback. New Home Sales Sales of new single‐family houses in March 2019 were at a seasonally adjusted annual rate of 692,000, according to […]

April 22, 2019 | Existing Home Sales Down 4.9%, Resume Slide After February Surge

Following a revised lower surge in February, Existing home sales flopped in March. The NAR reports 5.21 million sales in march at a seasonally-adjusted annualized rate (SAAR). This follows February’s surge to 5.48 million sales which now appears to be a one-hit wonder. The NAR originally reported 5.51 million in February (up 11.8%) now its […]

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