Mortgage Purchase Demand Rises 35% Week-over-week, Refi Demand Rises 14% As Mortgage Rates DROP To 7.17%

While the exciting headline is “Mortgage Purchase Demand rises 35%!” bear in mind that the level of mortgage purchase demand is still relatively low. This is volatility in mortgage applications.

Mortgage applications increased 2.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 1, 2023. Last week’s results include an adjustment for the observance of the Thanksgiving holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 43 percent compared with the previous week. The seasonally adjusted Purchase Index decreased 0.3 percent from one week earlier. The unadjusted Purchase Index increased 35 percent compared with the previous week and was 17 percent lower than the same week one year ago.

The Refinance Index increased 14 percent from the previous week and was 10 percent higher than the same week one year ago. Mortgage rates declined last week, with the 30-year fixed-rate mortgage falling to 7.17 percent – the lowest level since August 2023.

And with 5 rate cuts priced in, we should see mortgage demand increasing in 2024.

On the hotness front, here are the 10 smokin’ housing markets. Strange that the hotness score is highest for generally depressed economic cities like Manchester NH, Rochester NY and Rockford IL. Hey, at least Columbus Ohio made the top 10 on the hotness list!

Cryptos Soar After Largest Inflows In Two Years As US Dollar Purchasing Power DOWN -16.5% Since Covid (M2 Money UP 35.3%)

Joe Biden has a new name: the crypt keeper. As in the person through his economic screw-ups is causing a massive inflow to cryptos.

Anticipation of an eventual US spot Bitcoin ETF – which Bloomberg’s analysts assign a 90% probability of being approved by the SEC in January.

as well as surging prices, have helped to spur inflows into digital-asset investment products for a ninth consecutive week, the largest run since the crypto bull market in late 2021.

According to a recent report from CoinShares, these products which include trusts and exchange-traded products, saw inflows of $346 million last week, with Canada and Germany contributing to 87% of the total. Only $30 million came from the US, a sign of continued low participation from the country, the asset-management firm said. Of course, that will change as soon as investors start seeing double digit percentage weekly gains, and reallocating their money into crypto in droves, just like they did in 2020 and 2021.

Since early October, the crypto market has surged as traditional asset managers like BlackRock prepared for spot Bitcoin ETFs, potentially bringing in many more investors into the asset and resulting in inflows of tens of billions in fresh capital.

“The combination of price rises and inflows have now pushed up total assets under management to $45.3 billion, the highest in over one and half years,” the report said.

Bitcoin products raked in $312 million last week, pushing inflows to over $1.5 billion since the start of the year. Ether products saw $34 million in inflows last week, almost negating outflows all of 2023.

Amid the surging inflows, and amid expectations for imminent ETF approval by the SEC and a surge in March rate cuts odds, bitcoin and ethereum have continued their furious ascent, with the former now trading just shy of $40.

Since Covid and the idiotic government and school shutdowns of 2020, the purchasing power of the US Dollar has fallen -16.5% as M2 Money grew 35.3%. Keep on printing?

I suppose Biden’s biography can be called “Tales From The Crypt(o)”.

Bidenflation! U.S. Households Are Spending an Extra $11,400 Annually to Afford Basics (Purchasing Power Of US Dollar Down -15.4% Under Biden, Home Prices UP 33.2%)

While members of the Biden Administration party at DC nightclubs, the rest of America are drinking Carlo Rossi wine (a favorite of mine in high school!) and eating Spam.

The average U.S. household needs an additional $11,434 per year to maintain the same standard of living due to record-high inflation under the Biden administration.

While hourly pay has increased, inflation has outpaced it.

Spending on basic survival needs like food, transportation, housing, and energy has increased, with households in the Mountain West facing the highest rates of inflation.

“We choose January 2021 as the base month because it was the last time inflation was within recent historical norms,” the report reads.

“Due to a combination of higher inflation rates and higher average household spending, inflation is imposing the highest monthly costs on families in the states of Colorado, Utah, and Arizona,” the report adds.

Families in Colorado and Washington, DC, are experiencing inflation costs higher than the national average.

Things are even worse in 2023 regarding inflation ravaging worker’s income. Over 60% of Americans reported that their wages were lagging well behind inflation.

Almost 2 in 3 workers got a pay increase this year — but say they lost ground to inflation.

Since January 2021, US purchasing power of the US Dollar is down a whopping -15.4% under Biden.

And home prices are up 33.2% under Biden, much of it due to The Feral Reserve money printing to fund Biden’s folicy initiatives. (I saw Biden claim he wrote the Inflation Reduction Act … the one thing we know is House legislation is written by an army of Congressional staffers, not El Presidente).

Home prices up 33.2% and purchasing power of US Dollar down -15.4% under Biden.

And like magic, Biden made $11,400 disappear from household income to pay for Bidenomics.

Biden’s Brawndo (The Economic Mutilator)! Fed Paid Treasury $76 Billion In 2022, $200 Million Every Day, Bank Willingness To Lend Crashes, Bank Credit Falls For 16th Straight Week, Biden Enacts War Powers To Get Households To Use Inefficent Electric Heat Pumps

Biden’s terrible economic policies and horrid fiscal managment has put stress on The Federal Reserve. The Federal Reserve paid an estimated $76 billion to the Treasury in 2022 while banks’ willingness to lend has plummeted.

First, let’s look at Biden’s and The Fed’s Brawndo.

One of the key ways central banks absorb liquidity back out of the market is through reverse repo. These are short-term transactions where the Fed sells securities to banks and agrees to buy back at a higher price the next day.

This means banks are being paid to park cash with the Fed instead of injecting it into the economy through loans and fanning the fires of inflation.

That alone is costing the Fed $200M every single day.

In addition, the Fed is spending another $500M in daily interest payments on its reserve policy, i.e. balances that banks are holding in their reserve accounts at the Fed.

Banks’ willingness to lend has plummeted making credit availability increasingly tighter. Current levels have typically ended in recessions.This time is NOT different.

And on the energy side of the market, Biden Invokes ‘Wartime Powers’ to Attack Gas-Powered Furnaces. Of all the stupid things Biden has done, invoking wartime powers to make households use inefficent electric heat pumps instead of gas furnaces in stupid of two levels. First, invoking wartime powers for things unrelated to national defense is reckless and capricious. Second, electric heat pumps in the colder areas of the country is stupid as well. Electric heat pumps are inefficient, unless the goal of Biden and his Idiocracy is to “cull the herd” or kill off people during winter months (I had an electric heat pump in a condo I owned and it was terrible in winter months).

Yes, the Biden Administration and The Fed are economic mutilators!

The Thrill Is Gone? US Industrial Production Plunges In October As Auto-Maker Strikes Hit (But Also Federal Stimulypto Has Worn Out)

The thrill has gone from all the BIG spending bills from Biden.

After its surprising bounce last month (on a seasonally-adjusted basis, because it crashed NSA), US Industrial Production was expected to decline 0.3% MoM in October. It was worse – down 0.6% MoM from a downwardly revised September print (from +0.3% to +0.1%). October’s decline is the worst since Dec 2022 and the YoY drop of 0.8% is the worst since the COVID lockdowns. AND Federal stimulypto is wearing off (M2 Money growth surge peaked in February 2021, but has slowed into negative growth starting in August 2022.

Notably, once again, the non-seasonally-adjusted industrial production tumbled more than then seasonally-adjusted data…

Source: Bloomberg

On the manufacturing specific sector, consensus was for a 0.4% drop MoM but it was considerably worse, dropping 0.7% MoM (and September’s print was revised down from +0.4% to +0.2% MoM). That is the biggest MoM drop since March and biggest YoY drop since the COVID lockdowns.

That is also the 8th straight month of YoY declines for Manufacturing production.

Source: Bloomberg

Output was weighed down by a 10% plunge in motor-vehicle production as the annualized rate of car assemblies dropped to 9.22 million units, the least since February 2022. Excluding parts production, autos and trucks production fell 16.5% MoM – the biggest drop since the COVID lockdowns…

Source: Bloomberg

Starting in September, the United Auto Workers union authorized targeted strikes against the Big Three Detroit automakers, disrupting production at the companies and at their suppliers. The UAW reached tentative agreements with management in late October, laying the groundwork for a rebound in factory output in November.

So theorteically, we should see bounce back next month. Unless demand – as WMT hinted at – has fallen off a cliff.

Bidenomics Strikes Again! Foreclosure Sale Notices For Commercial Property Loans Are Exploding, LA Apartment Sales Cratering (Newsom Creates New Potemkin Village For China Xi’s Visit)

Bidenomics strikes again!

After listening in horror to Joe Biden’s press conference after his summit with China’s Xi, I had to ask the following question: what does Joe Biden has in common with Georgia Tech? Answer? They are both rambling wrecks. Biden made a horrendous foreign policy blunder by calling Xi a “dictator” and almost blew it by nearly spillling the beans on our foreign policy negotiations with Israel. SecState Blinken had to intervene. We are represented by Winken (Harris), Blinken and Nod (Biden, who usually looks asleep or confused).

But back to the horrors of a slowing economy.

As the US economy slows down (like Biden himself), we are seeing further cracks in the real estate market. Foreclosure sale notices for commercial property loans are exploding.

And depending on the MSA, multifamily delinquencies are booming, like in Houston, Texas, New York City and Phoenix AZ.

Then we have this headline: “Not Just Office Towers – Commercial Real Estate Sales Crater Throughout Los Angeles.” It’s difficult to find big commercial real estate deals of any kind in Los Angeles. A new report from NAI Capital reveals how severe and universal the decline in activity is throughout the region this year amid collapsing values, higher interest rates, and a new tax on property sales above $5 million.

A related headline screams “LA Apartment Sales Plummet 50% as Investors Confront New Taxes, Higher Costs.” Every submarket saw an increase in vacant units and a decline in year-to-date sales volume in the second quarter. Construction, interest rates, eviction protections, also define 2023.

Yes, I know, California’s real estate woes are mostly the fault of their politicians like Governor Gavin (Gruesome) Newsom. The same guy who ordered San Francisco’s homeless population to be moved creating a new Potemkin Village. But rising interest rates are the fault of excessive spending by Congress and the Biden Administration.

Prepayments on Ginnie Mae MBS are extremely low.

But things are less than rosy in Communist China. China’s housing woes worsen as prices fall most in eight years.

But my favorite headline is from the Babylon Bee (a satire site): “After Five Minutes With Biden, Xi Gives Order To Invade Taiwan.”

Biden’s Mortgage Market! Mortgage Purchase Demand Falls 0.3% Since Last Week And -12% Since Last Year, Stocks, Bitcoin Booming, Gold Enters Contango (Mortgage Rates UP 172% Under Biden)

Biden says he wants 4 more years to finish the job. Like killing off the mortgage market completely, Joe?

The Market Composite Index, a measure of mortgage loan application volume, increased 2.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.4 percent compared with the previous week. The seasonally adjusted Purchase Index increased 3 percent from one week earlier. The unadjusted Purchase Index decreased 0.3 percent compared with the previous week and was 12 percent lower than the same week one year ago.

The Refinance Index increased 2 percent from the previous week and was 7 percent higher than the same week one year ago.

Of course, mortgage rates have been declining slightly over the past few weeks, but remain up 172% under Biden.

At least the stock market is booming after the inflation report signalled that The Fed is likely done with rate hikes.

On the gold front, we are seeing evidence of contango.

Bitcoin? Down a wee bit after a staggering rise in price over the past year.

Here is China’s Xi meeting with Biden’s likely replacement, “Greasy Gavin” Newsom and Newsom’s likely Treasury Secretary, Janet “Too Low For Too Long” Yellen. Newsom, Yellen and Xi all want havoc in America.

We WILL Get Fooled Again! Purchasing Power Of US Dollar DOWN -15% Under China Joe Biden (Top 1% Doing Great Under Bidenomics, Not The Middle Class)

Republicans elected Mike Johnson from Louisiana as House Speaker, then were surprised when Johnson agreed with big spending Senators McConnell and Schumer on Biden’s mega spendathon. Also, several Republicans voted with Democrats NOT to impeach Cuba Pete (Mayorkas) for allowing 8 million illegals to cross the southern border. Bottom line: the Biden Administration and Congress are closely held subsidiaries of the elite 1% and US large corporations. The middle class be damned! But we will get fooled again in every election.

Since Biden’s inaugration in January 2021, the purchasing power of the US dollar is down a staggering -15%.

Yes, under control of large corporations and the 1%, the economy is an economic wasteland. But the 1% are doing great under Bidenomics! With The Fed’s help of course.

Here is a chart of core inflation relative to M2 Money printing. Easy way to cool inflation … stop printing money!

Here is China’s Xi and America’s “China Joe” Biden.

Seriously, Biden has always been known as being stupid and corrupt. Now he has dementia. A PERFECT President for the 1% in their war against the middle class. Biden is the penultimate “useful idiot” with an emphasis on idiot.

Biden’s Mortgage Market! Mortgage Demand (Applications) Increase By 2.5% From Previous Week As Mortgage Purchase Demand Down -20% From Last Year (Refi Demand Down -7% From Last Year While Mortgage Rate Is UP 169% Under Biden)

US inflation is lower than it was a year ago (cheers from The View CNN and MSNBC cheerleaders), but inflation remains stubborning above The Fed’s 2% target rate and will likely remain above 2% for the nexf few years. So mortgage demand is much like inflation … mortgage demand increased in the latest week but generally is very low compared to last year.

Mortgage applications increased 2.5 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 3, 2023.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1 percent compared with the previous week. The Refinance Index increased 2 percent from the previous week and was 7 percent lower than the same week one year ago.

The seasonally adjusted Purchase Index increased 3 percent from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 20 percent lower than the same week one year ago.

The 30-year fixed mortgage rate dropped by 25 basis points to 7.61 percent, the largest single week decline since July 2022. But, mortgage rates are up 169% under Biden and Bidenomics.

Bideomics is over, under, sideways, down. Mostly down.

“Rich Men North Of Richmond” Economy! US Debt Up 45% Since Q1 2020, But Consumer Debt Is Up 19% Under Biden (Personal Savings Down To 3.4% Compared To 7.7% In Last Month Before Covid Outbreak (Earnings Calls Reveal Concern About Continued Demand)

Call it “The Rich Men North Of Richmond” economy. Where the coastal elites drive the US economy off the cliff with insane spending and borrowing with much of the benefits flowing to big political donors, not the middle class. Think of Span Bankfraud Parboiled as an example.

President Biden loves to spend billions and go on endless vacations (he is in Rehobeth Beach Delaware yet again). He (illegally) forgave student debt, keeps spending billions on Ukraine and keeps spending on failed green energy nightmares.

Biden and his allies will tout the latest GDP numbers as an example of how marvelous Bidenomics is. BUT that GDP report was driven largely by consumer spending.

Since the Covid outbreak in 2020, Federal (public) debt is up 45%! Wow. And consumer debt is up 19% under Biden to cope with inflation (caused primarily by massive Federal spending).

To fuel consumer spending, the personal savings rate has fallen to 3.4%. For point of reference, the personal savings rate in Februray 2020 was 7.7%, so the consumer is running out of gas thanks to inflation and spending.