Confounded Interest – Anthony B. Sanders
Financial Markets And Real Estate
US existing home sales dropped 2.7% MoM (vs -0.7% MoM expected) in June leaving existing home sales unchanged year-over-year.
The median sales price increased 2% in June from a year ago to a record high of $435,300.
Meanwhile, The Fed keeps on printing money.
This is a new world for housing and mortgage finance. Outrageous, unafforable housing for millions.
Housing in the USA is simply unaffordable!
House prices have exploded since Covid, primarily due to massive Federal spending.
In terms of YoY growth, average hourly earning are exceeding home price growth.
Affordable housing is difficult to achieve at the national level since local politicians control local economies badly. Think LA Mayor Karen Bass who is taking Pacific Palisades which recently burned down and wants to build multifamily housing for low income households. This reminds me of the folly in Long Branch New Jersey where they built low income housing on the beach front. It failed, of course.
Doctor, doctor, we’ve got a bad casing of unaffordable housing.
Here is a picture of US affordable housing policy.
Keep on printing is the song of The Federal Reserve. But its the same all over the world as global central banks are printing zads of money too.
Bitcoin keeps on growing in price as global M2 Money supply keeps on growing.
And the same is true for ethereum. It keeps growing as M2 Money keeps growing.
It is another example of government gone wild!
The media and Democrat politicians love to fear monger about how Trump’s tariffs would cause inflation and unemployment. But June’s import prices showed no inflation at all. In fact, import prices FELL -0.2% YoY.
The latest jobs report revealed that U-3 unemployment FELL to 4.10%.
But don’t worry. Elizabeth Warren (D-MA) will get hysterial about Trump firing Fed Chair Jerome Powell. And, as usual, be wrong.
Currently, bond market investors are singing Twist And Shout as Trump ponders firing Fed Chair Jerome Powell. In fact, the US Treasury yield curve has TWIST STEEPENED.
The US Treasury curve is indeed steepening its slope.
I strongly urge President Trump to fire Powell and appoint Blue Velvet’s Frank Booth as Federal Reserve Chairman.
And only Pabst Blue Ribbor beer will be served at the Fed’s restaurant in DC. Not Heineken.
US prices rose 0.3% MoM in June according to the Bureau of Labor Statistic (BLS). And on a YoY basis, inflation rose 2.7% while core inflation rose 2.9%.
Supercore inflation was up 3.017% YoY.
As of May, import prices rose a scant 0.0% MoM and 0.2% YoY.
Shelter rose 3.8% YoY in June while gas utilities rose 14.2%.
And on this news, the yield on 30-year Treasuries rose 5%.
Not a chance that Foul Powell will cut rates now.
The U.S. has already brought in nearly $73 billion in revenue from tariffs so far this year, compared to $77 billion in tariff revenue for the entirety of 2024. In Trump’s second term, tariff revenue is over $25 billion.
So much for the hysteria over a stock market crash and massive increase in inflation. Particularly “economists” who say this nonsense. Who are those guys?
Away! And bitcoin! Silver prices are soaring.
And Bitcoin is soaring as well along with long-term Treasury yields.
Silver and bitcoin are the Lone Rangers of alternative investments!
Tavi Costa at Crescat Capital (founded by my former MBA student at University of Chicago Kevin Smith) produced this excellent chart of silver prices showing the cup and handle of silver prices.
The rise in silver prices corresponds with a deterioration of the US bond market. Look at Treasury futures courtesy of Bravos Research.
Of course, Washington DC’s insane spending has led to insane money printing by The Feral Reserve.
Everyone in Washington DC deserves a “Silver Cup of Failure” for uncontrolled government waste and spending and mismanagement by The Feral Reserve.
Thank goodness “Statist Joe” Biden is gone. Kamala Harris is still lingering around the edges, while the mortgage and housing markets are still suffering from the Biden/Harris regulatory overreach.
Mortgage applications increased 9.4 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 4, 2025. Last week’s results included an adjustment for the July 4th holiday.
The Market Composite Index, a measure of mortgage loan application volume, increased 9.4 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 13 percent compared with the previous week. The seasonally adjusted Purchase Index increased 9 percent from one week earlier. The unadjusted Purchase Index decreased 13 percent compared with the previous week and was 25 percent higher than the same week one year ago.
The Refinance Index increased 9 percent from the previous week and was 56 percent higher than the same week one year ago.
Mortgage rates moved lower last week, with the 30-year fixed rate decreasing to 6.77 percent, its lowest level in three months. After adjusting for the July 4th holiday, purchase applications increased to the highest level of activity since February 2023 and remained above year-ago levels.
Biden claims the foreign leaders have been calling him for advice. Here is one example.
Confounded Interest - Anthony B. Sanders 
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