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March 26, 2020 | Helicopter Money for Wall Street

otal assets on the Fed’s weekly balance sheet, released this afternoon, spiked by $586 billion in one week, to $5.25 trillion. This doesn’t even include yet the bulk of the mortgage-backed securities (MBS) the Fed bought over the past two weeks because the Fed books them when its trades settle, and MBS trades take a […]

March 18, 2020 | Treasury Market, Gold Go Haywire as Fed Struggles to Contain What’s Turning into Financial Crisis 2

The sell-off among US Treasuries with 10-year maturities is seriously rattling nerves. The 10-year yield spiked to 1.22% early this morning (when the price of a bond falls, its yield rises by definition). The problem began Monday morning last week, March 9, when suddenly the 10-year yield started rising from its historic low of 0.32%. […]

March 12, 2020 | Stocks Crashed. I Covered My Short Positions (SPY, QQQ) Because “Nothing Goes to Heck in a Straight Line.” Out of Spite, Bought Some Crap for a Bear-Market Bounce

  The S&P 500 plunged 9.5% today to 2,481, where it had first been in September 2017. It has plunged 26.7% in the last 16 trading days since its peak. It has plunged 14% in just two days. That was fast, too fast, based on our WOLF STREET beer-mug dictum, “Nothing goes to heck in […]

March 1, 2020 | China’s Non-Manufacturing & Manufacturing PMIs Show to What Unfathomable Extent the Economy Has Collapsed

Purchasing Managers’ Indices (PMIs) are a tally of how executives see their own company – whether business activity at their company rose or fell compared to the prior month, whether new orders rose or fell, whether they added or shed staff, etc. Executives and their companies remain unnamed. A value above 50 means expansion; a […]

February 20, 2020 | Ecommerce Spikes by Most Ever. Brick & Mortar Melts Down. Department Stores are Toast

Ecommerce retail sales jumped 16.4% in the fourth quarter 2019 compared to a year earlier (not seasonally adjusted), to $187 billion, and reached $602 billion for the year, double the amount five years ago, according to the Commerce Department. Ecommerce retail sales in Q4 were $26.4 billion higher than in Q4 a year earlier, the […]

February 15, 2020 | “Speculative Energy in the Market is Incredibly out of Control”

This market has been an astounding experience for people who’ve traded through the prior stock market bubbles and the last three crashes, who’ve seen a national and several regional housing bubbles form and implode, who’ve seen the subprime-auto-loan Asset Backed Securities bubble blow up in the mid-1990s and again during the Financial Crisis, and now […]

February 8, 2020 | The State of the American Debt Slaves, Q4 2019

Consumer debt – student loans, auto loans, and revolving credit such as credit cards and personal loans but excluding housing-related debts such as mortgages and HELOCs – jumped by $187 billion in the fourth quarter 2019, compared to a year earlier, or by 4.7%, to a record $4.2 trillion, according to Federal Reserve data released […]

January 28, 2020 | The Most Splendid Housing Bubbles in America, January Update

Reports have been circulating for a while about the deterioration in the Manhattan housing market, including a report in December that studied condo towers with 30 or more units, built after 2015, in total 7,727 condos, nearly half of which the developers have been unable to sell. Much of the new inventory is at the […]

January 23, 2020 | Fed’s Repos Drop to Oct Level, T-Bills Surge, But MBS Fall, and Total Assets Decline Further

The Fed had doused the market with $410 billion in liquidity between September and January 1 through its repo operations and its T-bill purchases. Market hype had expected this blistering pace of money-printing to continue, but wait… While T-bill purchases continue, the repos on the Fed’s balance sheet are getting unwound, its mortgage-backed securities (MBS) […]

January 5, 2020 | Carmageddon Spreads to Canada

Sales of passenger cars and light trucks in Canada fell 3.7% to 1.91 million vehicles in 2019, the second year in a row of declines, and were down 6.1% from peak-year 2017, according to industry data compiled by Des Rosiers Automotive Consultants: These sales are new vehicles that dealers delivered to their customers, or that […]

January 1, 2020 | The Most Splendid Housing Bubbles in America, Dec. Update

Powered by the innumerable millionaires and multimillionaires that the mega IPOs would be suddenly printing in 2019, home prices in the San Francisco Bay Area would be doomed to surge this year, thus exacerbating the “housing crisis,” as it’s called locally, even further, the media have promised us incessantly earlier this year, having fallen once […]

December 24, 2019 | What Options Do Mall Landlords Have When Brick & Mortar Retail Melts Down on Them?

Mall investors have long denied it. But year after year, ecommerce has been eating up brick-and-mortar retail sales, in the third quarter faster than ever, and in the fourth quarter, according to early indications, even faster. Turns out, ecommerce is a structural change that grew out of the arrival of the Internet, has been underway […]

December 21, 2019 | Below-the-Surface Struggles in Manhattan Housing Bust Seep to the Surface

That the Manhattan market for condos and co-ops has been heading lower is no secret. The price and sales data I’m going to briefly lay out here is just to provide a backdrop for what comes next – the struggles below the surface that rarely make it to the surface. But this time they did. […]

December 14, 2019 | The State of the Canadian Debt Slaves, How They Compare to American Debt Slaves, and the Bank of Canada’s Response

Canadian households, rated near the top of the most indebted in the world, accomplished something awe-inspiring: They got even more indebted and their leverage rose to a new record, according to data released today by Statistics Canada. The portion of their disposable income (total incomes from all sources minus taxes) that Canadian households spent on […]

December 9, 2019 | Accounting Fraud & Freight Recession Topple Celadon, Largest Truckload-Carrier Bankruptcy in US History

Celadon Group, one of the larger full-truckload operators in the US with about 3,000 drivers and about 2,700 tractors, said today – confirming days of rumors – that it filed for Chapter 11 bankruptcy and is ceasing operations. This is the largest truckload carrier ever to file for bankruptcy in US history. The drivers, hauling […]

December 5, 2019 | Fed Goes Hog-Wild with T-Bills, But Repos Drop from a Month Ago, and MBS Shrink by $22 Bn

The total amount of repurchase agreements (“repos”) on the Fed’s balance sheet as of December 4, released today, declined to $209 billion, from $215 billion a month ago. These repos included: $70 billion in overnight repos, issued on Wednesday morning that unwound today; all prior overnight repos had already unwound. $88 billion in multi-day repos […]

November 26, 2019 | Despite Startup Millionaires, the Most Splendid Housing Bubbles in America Deflate. Crushed Markets Scramble Higher

“The boom and bust patterns of home price growth in the West appear to be now solidly on the bust side,” said Ralph McLaughlin, deputy chief economist for CoreLogic, in a statement about today’s release of the firm’s Case-Shiller Home Price Index. So here we go. San Francisco Bay Area House Prices House prices in […]

November 19, 2019 | Canada’s Most Splendid Housing Bubbles v. Its Other Markets, October Update

Vancouver has tiny uptick after 14 declines. Toronto dips below July 2017 peak. Victoria ekes out new high. Calgary, Edmonton stuck below oil-boom peaks years ago. Quebec City flat for 6 years. Montreal ticks down from high. Ottawa ekes out new high but remains low. House prices in Greater Vancouver ticked up 0.2% in October […]

November 6, 2019 | Yield Curve Un-Inverts, 10-Year Yield Spikes, Middle-Age Sag Disappears

Yield Curve Spaghetti! It happened. Hallelujah. Or maybe better: Watch Out! The yield curve, after having been at least partially inverted all year, un-inverted today. The yield curve still kind of flat at the short end, but the middle-aged sag is gone, and the long end with maturities of seven years and up is higher […]

October 30, 2019 | Dallas, Minneapolis, Chicago, Charlotte, Atlanta, Detroit, Cleveland: From Smaller Housing Bubbles to Crushed Markets

Prices in red-hot Dallas slow. Chicago condos flat for the year. Formerly crushed Detroit up 100% in 7 years. Cleveland struggles out of crushed status. Yesterday, we did The Most Splendid Housing Bubbles in America — such as the San Francisco Bay Area, New York City metro, the Miami metro, Seattle, and other markets that […]

October 26, 2019 | Subprime Auto Loans Blow Up, 60-Day Delinquencies Shoot Past Financial Crisis Peak

Santander Consumer USA is on the forefront of souring subprime-auto-loan backed securities. Santander Consumer USA, one of the largest subprime auto lenders and the largest securitizer of subprime auto loans, is not alone. But it’s on the forefront. It had $26.3 billion of subprime auto loans as of June 30 that it either owned and […]

October 15, 2019 | Dual-Track Economy: Slowdown in Industrial Sectors Hits Truckers & Railroads. But Consumers Are Still Buying Stuff

The hangover after the tariff-front-run boom last year. Freight shipments by all modes of transportation – truck, rail, air, and barge – within the US fell 3.4% in September 2019, compared to September last year, according to the Cass Freight Index for Shipments. For the index – which tracks shipment volume of consumer and industrial […]

October 12, 2019 | Global Air Freight Sinks into Longest Recession Since 2008

US-China trade war, falling business confidence, slowdown in China, German exports, and new: the temporary shutdown of Hong Kong’s airport, the largest cargo hub in the world. Demand for global air freight, domestic and international, as measured in freight tonne kilometers (FTKs), fell by 3.9% in August compared to August last year, the 10th month […]

October 1, 2019 | Tariff-Front-Running Hits US Manufacturing, after Causing Biggest Surge since 2004

Supply chains begin to shift back to US suppliers, “due to tariffs.” Two US manufacturing reports were released this morning, one showing the fastest decline since June 2009, and the other showing an increase in growth, and given the bad numbers recently, the fastest growth in five months. So get ready for mild whiplash. The […]

September 17, 2019 | Debt-Wracked Chinese Companies Dump US & Other Foreign Assets, Become Net Sellers Overseas for First Time

Another piece in the Chinese capital-flow puzzle. Chinese conglomerates that had gone on a debt-fueled buying binge over the past decade but have come under heavy pressure from the government to sell their overseas holdings in order to reduce their astronomical debts – well, they’re doing it. In the US, Chinese conglomerates have dumped $26 […]

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