Too Much Debt! US Government And Consumers Are Debt Crazed (US Debt Hits $34.8 TRILLION, Consumer Debt Hits $17.69 TRILLION, Unfunded Liabilities Hits $216 TRILLION)

Too much debt should be the theme song for the US! Both for consumers and the Feral government (not a typo!)

Consumer credit increased by +$6.403 billion in April, much softer than consensus estimate of +$10 billion … more notable, however, was March data, given initial read of +$6.274 billion was revised down to -$1.099 billion.

Not to mention $13 trillion in mortgage debt (1-4 unit housing), but at least that is backed by property. Unlike The Feral government who borrows/prints with only a promise.

Consumer Debt Hits $17.69 TRILLION.

US national debt stands at $34.8+ trillion.

And growing awfully fast. Note that since the “pandamic”, debt as % of GDP has exceeded 100% and is projected to hit 166% by 2054. But look at the UNFUNDED LIABILITIES the need to be paid ($216+ TRILLION ($641.5k per citizen!). Pretty soon, we (the 99%) will be back on the chain gang paying for endless wars and government corruption. I wish Biden, Schumer, McConnell and other swamp creatures would consider all the spending the government is on the hook for rather than focus on spending that will help them get elected perpetually. There is no middle of the road anymore. The US is broke and has too much debt.

Of course, President Biden wants endless spending on wars (Ukraine, Israel, etc) and now wants an unlimited check to pay for the next pandemics. The Pretenders’ song “My City Was Gone” seems to be appropriate for the US as “My County Is Gone.”

Of course, some “economists” claim that the US can borrow/print unlimited amounts of money … until they can’t.

ZERO INCREASE In Jobs For Native-born Workers In Over Five Years! (Native-born Workers Lost 463k Jobs In May 2024 While Foreign-born Workers Gained 414k Jobs)

The theme song for the Biden Administration should be “South of The Border.”

Biden’s open borders policies are like something out of the book/film “Gangs of New York.” This time it isn’t Irish immigrants that are rioting/looting, it iis illegal immigrants from Latin America, China, and the Middle East. Essentially replacing native-born workers with foreign-born workers.

Since COVID, the growth in foreign-born workers have blow away the growth in native-born workers. So much so that since 2019, native-born workers have actually lost jobs while foreign-born workers have surged.

But for May 2024, native-born workers lost 463k jobs while foreign-born gained 414k jobs.

In May, part-time jobs soared by 286k jobs while full-time jobs nosedived by -625k jobs.

Finally, the difference between the BLS survey and the more accurate Household Survey is huge!

Krugman’s Grossly Misleading Inflation Victory Declaration … BUT Purchasing Power Of US Dollar Is Down -16.5% Under Biden (Food Prices UP 21%, Home Prices UP 34%, Used Car/Truck Prices UP 17.7%)

Call it Washington DC soullessness.

Back in 2023, Socialist Paul Krugman declared that “the war on inflation is over!!! “We” won, at very little cost.” I love when elitists claim “We won!” since clearly 99% of Americans lost since food, housing and car prices up are double digits under Biden.

The problem is that food, energy, shelter, and used cars/trucks are a huge part of Americans consumption basket.

Under Biden, food CPI is up 23%. Home prices are up 34% and used cars/truck prices are up 17.7%.

A note to Paul Krugman, YOU may have won, but the rest of Americans lost. Consumer purchasing power of the US Dollar is DOWN 16.5% Under Biden.

Here is where we stand under Bidenomics.

Ask Joe if he cares.

Chicago PMI Screams RECESSION! Falls To Cycle Low Of 35.4, Back To 2008 Recession Levels (Copper Prices Rising!)

Not so Sweet Home Chicago!

After unexpectedly slumping last month to 37.9, the Chicago PMI index cratered even more unexpectedly in May, when it defied hopes of a rebound to 41.5, and instead tumbled even more, sliding to a cycle low of 35.4 which was not only below the lowest estimate, but was staggeringly low. To get a sense of just how low, the last two times it printed here was during the peak of the covid and global financial crises…

… which seems to suggest that at least according to Chicago-based purchasing managers, the economy is in a depression.

This is how the final number looked relative to expectations.

Looking at the report we find the following:

Business barometer fell at a faster pace; signaling contraction
New orders fell at a faster pace; signaling contraction
Employment fell at a faster pace; signaling contraction
Inventories fell at a faster pace; signaling contraction
Supplier deliveries fell at a slower pace; signaling contraction
Production fell at a slower pace; signaling contraction
Order backlogs fell at a faster pace; signaling contraction

Did nothing rise? One thing did:

Prices paid rose at a slower pace; signaling expansion

So we have not just a depression, but a stagflationary depression in which everything else is going to hell, except prices: they keep on rising.

And while it is unclear what has prompted this unprecedented bearishness (the surely negative contribution from Boeing is likely to blame for a substantial portion of the apocalyptic outlook), one thing is certain: Goldman will have to come up with even more goalseeked surveys that explain away reality and tell us how purchasing managers really should feel…

On the good news front, REAL Gross Domester Income rose to 1.5%.

As copper prices keep on rising. Which is bad news for Biden’s shift to EVs! (Once again, Biden is driven around in gas guzzling Chevy Tahoes/Suburbans and owns a Chevy Corvette). There isn’t enough copper production to build the EVs that Biden wants.

Biden drove his Chevy to the STRATEGIC PETROLEUM RESERVE and the reserve was dry. And them good old Democrats were drinkin’ whiskey and rye after a New York Jury found Trump guilty of 34 felony counts, despite there not being any laws broken.

I have testified and sat through many trials in New York city and have never seen a court case quite like the one the Trump lost with the Judge effectively telling the jury to find Trump guilty.

US Pending Home Sales Plunge To Record Lows In April As Rates Rose (After Terrible Mortgage Report)

With the terrible mortgage applications index from Wednedsay, we are seeing US pending home sales crashiing. As Joe Biden handles the economy his way.

After an unexpected jump in March, pending home sales were expected to drop 1.0% MoM in April as mortgage rates pushed back above 7.00% and stayed there.

Well, the analysts had the direction right but magnitude was way off as pending home sales plunged 7.7% MoM – the biggest drop since Feb 2021 (and below the lowest estimate), leaving sales down 0.7% YoY…

Source: Bloomberg

This is the 29th straight month of YoY declines for non-seasonally-adjusted pending home sales.

This MoM decline pushed the Pending Home Sales Index back to record lows…

Source: Bloomberg

The Midwest saw the biggest drop in pending sales, down 9.5% in April, followed by declines of 8.5% and 7.6% in the West and South, respectively. Contract signings in the Northeast fell 3.5%.

“The impact of escalating interest rates throughout April dampened home buying, even with more inventory in the market,” NAR Chief Economist Lawrence Yun said in a statement.

“But the Federal Reserve’s anticipated rate cut later this year should lead to better conditions, with improved affordability and more supply.”

All driven by affordability crisis as mortgage rates surged back above 7.00%…

Source: Bloomberg

“The prospect of measurable home price declines appears minimal,” Yun said.

“The few markets experiencing price declines will be viewed as second-chance opportunities for buyers to enter the market if those regions continue to add jobs.”

As a reminder, the pending-sales report tends to be a leading indicator of sales of previously owned homes, because houses typically go under contract a month or two before they’re sold.

Economic Surprise Index Falls To -0.126 As Buying Conditions For Housing Remains Negative For Most Of Biden’s Presidency (US Debt Servicing Costs 12% Of Government Spending)

I saw former President Obama criticizing former President Trump for not passing “transformative” changes. That is, Trump didn’t sign any Obama-like transformative changes (like Obamacare). Truimp did try to slow down the damage done by Obama and his transformative agenda (e.g., open borders, wealth redistritution, green energy) that Biden has attempted to continue.

As we approach the party conventions and Presidential election of 2024, we saw the Economic Surprise Index (ESI) in May decline to -0.126.

Coupled with Biden’s negative buying conditions for housing (higher mortgage rates and soaring house prices), Obama’s Jacobian transformative economic fantasty is on thin ice.

Speaking of higher interest rates, US debt servicing costs currently make up 12% of government spending. Jacobin revolution = Cloward-Piven.

Let’s hope the Obama/Biden Jacobin revolution doesn’t get to this point!

Gasoline Prices UP 60% Under Biden As He Releases 1 Million Barrels Of Gasoline From Northeast Reserve (Hypocrite Joe!)

You know “Green Joe” is desperate for re-election when he approves the release of 1 million barrels of gasoline from the Northeast Reserve in an attempt to lower gasoline prices. Jennifer Granholm, US energy Overlord, said it is to lower gasoline prices for 4th of July weekend (LOL!). Or in time for the November Presidential election.

Remember, gasoline prices are up 60% under Biden. While Biden brags that gasoline prices has fallen recently, they are still up 60% nationally.

Gasoline futures prices are down a little today after the announcement by Granholm.

I never thought Biden really believed what he was spewing, trying to force us to buy electric vehicles while he drives a gas-guzzling Chevy Corvette.

I’ll bet his green zanies won’t like this!

What a creep!

PBOC Earmarks $42 Billion for State Buying of Unsold Homes (BAD Central Planning Approach)

Don’t show Biden this story. Biden has never met a bad central planning scheme that he didn’t like and this one is TERRIBLE.

China’s struggling housing market is set to receive a boost from a new nationwide program funded by the People’s Bank of China to address oversupplied conditions. As a critical driver of the domestic economy, the nation’s housing market has been in a multi-year slump. This latest initiative by policymakers aims to stabilize the housing market and stimulate the broader economy.

Bloomberg reports that PBoC Deputy Governor Tao Ling announced the new 300 billion yuan ($41.5 billion) nationwide program of cheap funding to allow state-owned companies to purchase unsold homes.

Ling said the funding will be directed at 21 providers, including policy banks, state-owned commercial lenders, and joint-stock banks. A rate of 1.75% will be offered. The low-cost loans have a one-year term and can be rolled over four times.

The new program powerfully signals that policymakers are pushing for property policy easing and measures to balance the supply-heavy housing market, which casts a dark cloud over the world’s second-largest economy. This announcement appears to be a step in the right direction in a national-level policy.

Bloomberg first leaked the new rescue policies days earlier. We titled the note “Fiscal Bazooka: China Considers Buying Millions Of Homes To Save Property Market.”

Also, on Friday, policymakers eased mortgage rules and removed the mortgage rate floors for first and second homes. PBoC also lowered the minimum downpayment ratio for first-time homebuyers to 15%. The downpayment ratio for second-home purchases was lowered to 25%.

Chinese Vice Premier He Lifeng said that authorities in cities with excess home inventories should purchase unsold properties and convert them into affordable housing. He also urged local governments to repurpose inactive land parcels held by property developers to alleviate their financial troubles.

This was a very policy-heavy week to save the debt-stricken real estate market. Data showed that property investment and new home sales in April experienced larger contractions, while housing prices slid even further.

China’s ailing property sector is a drag on GDP.

Housing sales are tumbling.

And apartment and commercial property sales are sliding.

In markets, the CSI 300 Real Estate Index closed up 9%, with gains from April 24 totaling about 36%. Yet the latest gains in the property index are still 68% below the early 2018 peak.

The index’s weekly gain was the most since early December 2015.

It isn’t in a Communist countries’ DNA to let markets solve the problem … like letting prices correct no matter how painful that adjustment is. Biden and his “economic” advisor Jared Bernstein (not an economist but a public policy hack) would likely follow China’s idiotic solutions to the problem.

I debated Bernstein once at a Washington DC conference. He was arrogant but eventually confessed that he didn’t know anything about housing or mortgages. Nice economic advisor, Joe!

Rent Prices Rose for the Third Straight Month According to Apartment List (House Prices UP 33.2% Under Biden, 30Y Mortgage Rates Up 160%)

In a Socialist economy, housing is owned by The State, not its individual citizens. (Except for political party elites, of course). Fortunately, the United States hasn’t become a full-blown Socialist nation … yet.

But with home prices surging 33.2% under Biden and mortgage rates up 160%, homeownership is getting progressively more difficult and costly.

But renting is no picnic either (except for the flies and rancid potato salad). According to Apartments.com, rent prices rose for the third straight month.

What a mess, courtesy of the Biden Misadministration.

UMich buying conditions for housing has plunged to 26.

That’s Bidenomics! US Mortgage Purchase Demand (Applications) Rise 2% Over Past Week, But Remain DOWN -17% Since Last Year And DOWN -57% Under Biden

Biden and Bidenomics is disastrous for the middle class and low wage workers. Food and housing prices through the roof, and now we have mortgage purchase demand declining -57% under Biden.

Mortgage applications increased 2.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending May 3, 2024.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 3 percent compared with the previous week. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index increased 2 percent compared with the previous week and was 17 percent lower than the same week one year ago.

In fact, Mortgage Purchase demand (applications) are down -57% under Biden and Bidenomics.

The Refinance Index increased 5 percent from the previous week and was 6 percent lower than the same week one year ago.