Hey Big Spenders! Broken Money And Neverending Inflation (Inflation STILL At 18%)

Face it. The Federal government is broken. Congress and the Biden Administration are addicted to spending money and running up massive debts. There is no attempt at fiscal restraint because they will always argue that “More money must be spent!” On what exactly? Usually pet projects (aka, pork) like the LGBTQ retirement home in Boston for $850 thousand and $15 million for Egyptian college tuition.

How does “broken money” work? Badly. Without any fiscal restraint, politicians can just give away thousands/millions of dollars to the donor class (donate $1, get $1,000 in return). As you can see, the net worth of the top 0.1% has exploded with each ensuing “crisis.” There was the 2008/2009 financial crisis and the 2008 Covid crisis. With each crisis, the top 0.1% get richer and richer. You will note that net worth for the top 0.1% is closely related to M2 Money printing. Like, who gets the money printed by Uncle Spam? The 0.1%, of course!

Broken money leads people to store their value in sub optimal vehicles like housing. This drives the cost of real estate up unnaturally and increases the gap between the “haves” and the “have nots”. Sowing seeds of animosity. Seeds that, when left to germinate and grow via the further degradation of the money people use, blossom into ugly flowers of Anarcho Tyranny.

This has manifested in the trend of people claiming other’s houses by squatting in them when they are left unattended for an extended period of time. The preferential treatment that has been given to squatters over homeowners in recent years can be seen as the regime which controls the money printers throwing the plebs a bone as they struggle to get by, an attempt to push the productive class to violence against a state unwilling to respect private property rights, or a combination of the two.

Look at inflation if we use pre-1983 methods. Inflation is still roaring at 18%!

Broken money incentivizes governments to allow their borders to be bum rushed by cheap laborers who will take low paying jobs that enable the systemically fragile economy to keep chugging along while simultaneously increasing the chaos that already exists and diluting the values that the natives of this country believe in.

The excess and decadence enabled by a world run on broken easy money allows people to live in a detached reality that leads them to push objectively false narratives. This is why there are running debates about gender and a retreat from merit based compensation.

All of this stems from broken money.

The chart above should act as a reminder to you all that the biggest problem in the world right now is the money. The chart above should also prove to you that the most powerful people throughout the economy are going to fight tooth and nail to protect the broken money because they benefit massively from the fact that it is broken.

Keep this in mind as the chaos increases and narratives begin to form around using bitcoin as money. But we will never see inflation “normalizing” as long as Congress and Biden keep spending money.

Here are 3 of the BIG SPENDERS, Obama, Biden and Insider trader pro Pelosi. Do any of them look like the care about the bottom 50% of net worth or inflation??

Biden, Schumer Fund Border Defense In Spending Bill! Jordan, Lebanon, Egypt, Tunisia and Oman Get Border Funding, NOT The US (US Falls To 23rd In Global Happiness Ranking)

Biden loves to blame Republicans for the border crisis. Although he has it in his power to close and secure the border, but won’t. It’s easier to blame the opposition, like “extreme MAGA Republicans.” Huh, I didn’t realize that as a conservative American I am considered extreme by the Biden Administration.

Unfortunately, Biden, Schumer and Johnson only provided financial support for Jordan, Lebanon, Egypt, Tunisia and Oman. In the form of $380 million.

As the US falls to 23rd in World Happiness ranking. Based, in part, on Biden’s idiotic open borders policy.

Pork Barrell Chuck And Gaslight Joe! $60 Million For Ukraine, $0 For US Border Disaster (Purchasing Power Of Dollar Down -16% Under Biden)

Its Pork Barrell Chuck Schumer and Gaslight Joe Biden! Always ready to lie (gaslight) and spend trillions that we don’t have.

A new $1.2 trillion government spending package Congress is trying to ram through faces significant headwinds in the House, where members are expected to vote on it later this morning.

The 1,012-page bill was introduced at around 3am Thursday morning – just 48 hours before a midnight Friday funding deadline. It must pass both the House and the Senate, after which President Biden will sign it (with crayons at the ready, we’re sure).

The package accounts for approximately 70% of discretionary government spending – and consists of six out of twelve total bills that Congress must pass each fiscal year to fund the government. The six others, around $460 billion in spending, were passed earlier this month.

According to Fox News, multiple GOP sources, two GOP lawmakers and one senior GOP aide think the package will pass, but by a tight margin.

On Thursday afternoon, however, the bipartisan deal hit turbulence – with one GOP lawmaker citing absurd pork contained within – including funding for LGBTQ centers and facilities that provide late-term abortions.

Pork City

As usual, Democrats slipped in as much pork as possible, including:– $850k for a gay senior home- $15 million to pay for Egyptian’s college tuitions- $400k for a gay activist group to teach elementary kids about being trans- $500k for a DEI zoo- $400k for a group to gives clothes to teens to help them hide their gender

$60,000,000,000 for Ukraine (of course). NOTHING for US border.

$1,140,000,000,0000 for pork barrelling

1.2 trillion in inflation, an increase of the money supply by 2% in a single spending bill.

The US Dollar’s purchasing power is down -16% under Gaslight Joe.

Existing Home Sales Prices Explode In February (Median Selling Price Rose 5.7% to $384,500 From Last Year, Highest For Any February Back To 1999)

February’s existing home sales are like a scoop of cottage cheese. Seemingly satisfying until you look more closely at the data (or get hungry 30 minutes later).

Existing home sales soared a stunning 9.5% MoM in February, smashing the expectation of a 1.3% decline and building on the 3.1% MoM in January. However, even with the big monthly jump, existing home sales remain down 3.3% YoY…

Source: Bloomberg

Total existing home sales SAAR surged to 4.38mm – a 12 month high…

Source: Bloomberg

Homeowners may be accepting that mortgage rates are settling into a new normal and can’t delay moving any longer, NAR Chief Economist Lawrence Yun said on a call with reporters.

“Additional housing supply is helping to satisfy market demand,” Yun said in a statement.

“Housing demand has been on a steady rise due to population and job growth, though the actual timing of purchases will be determined by prevailing mortgage rates and wider inventory choices.”

With a 2-month lag, we can see why existing home sales may have risen, but with mortgage rates rising since then, we suspect the fun and games may come to an end again soon (even if the NAR economist thinks otherwise)…

The number of previously owned homes for sale climbed to about 1.07 million last month, and Yun said he expects that will continue to go up. At the current sales pace, selling all the properties on the market would take 2.9 months, the lowest in about a year.

Realtors see anything below five months of supply as indicative of a tight market.

Even with greater inventory, strong demand put upward pressure on prices. The median selling price advanced 5.7% to $384,500 from a year ago, the highest for any February in data back to 1999.

Sales rose in three of four regions, led by a 16.4% surge in the West

First-time buyers made up 26% of purchases in February, matching the lowest on record.

Biden’s War On Gas Cars Will Cost Americans A Fortune, 5-year Cost To Own An Electric Vehicle Exceeds $92,000 (Too Expensive, Only 73% Of Chargers In Working Order)

Biden continues to try to force Americans to buy electric cars and support China’s EV and battery industries! And are EVs ever expensive!

The Environmental Protection Agency released what it calls the “strongest-ever pollution standards for cars,” which it claims will “expand consumer choice in clean vehicles.”

That’s a stretch: These new regulations, which are clearly beyond EPA’s defined powers, will limit overall vehicle choice and force Americans into expensive and unreliable electric vehicles.

The EPA expects plug-in electric vehicles to make up between 62% and 70% of the automotive market. But this unrealistic target ignores two key facts:

First, consumers are not lining up to purchase electric vehicles, which made up only 7.6% of 2023 vehicle sales despite heavy subsidies.

American drivers simply aren’t embracing EVs because they know these vehicles have shorter driving ranges and longer refueling times. Not to mention that they’re significantly more expensive.

The five-year cost to own an average electric vehicle is more than $92,000, according to the North American Auto Dealers Association. Compare that to a typical gas-powered vehicle, which over the same period costs $76,500.

Second, readily available charging infrastructure remains elusive for many EV users.

Many of the available chargers are level 2, which the magazine U.S. News notes “is fine if you have time to kill.”

Repair issues compound even the limited levels of charging, as only 73% of chargers in some major centers are in working order, according to Autoweek.

In the face of rapid decreases in the growth of electric vehicle sales, automakers are already scaling back EV production plans.

In December, Ford announced it was cutting planned production of its F-150 Lightning pickup in half due to “changing market demand.”

The Mackinac Center for Public Policy has warned automobile manufacturers for years that leaving consumers out of their long-term business plans was a recipe for failure.

Taxpayers not only pay with more expensive cars, they have to subsidize new production facilities.

In Michigan, lawmakers have already promised $200 million dollars of taxpayer money — and that’s just for one Ford battery plant in Marshall.

Notice that Biden has his right hand mysterioulsy over the cup holders where the transmission shifter would be on his gas-guzzling Corvette. When Biden drives a Nissan Leaf and sells his Corvette, I will almost believe Biden. No, he lies so much I can’t believe anything you see.

US Home Buyers Need to Earn $47,000 More Than in 2020 (The Income Needed To Afford A Home Up 80% Since 2020, While Median Income Has Risen 23%)

How bad is Bidenomics for the American middle class? We know that inflation is far higher under China/Ukraine Joe (even with those awful looking Hoka shoes), but the pain that is being felt is attrocious.

Home shoppers today need to make more than $106,000 to comfortably afford a home. That is 80% more than in January 2020, showing how the math has changed for hopeful buyers, who are more often partnering with friends and family or “house hacking” their way to homeownership.

Housing costs have soared over the past four years

A monthly mortgage payment on a typical U.S. home has nearly doubled since January 2020, up 96.4% to $2,188 (assuming a 10% down payment).

Home values have risen 42.4% in that time, with the typical U.S. home now worth about $343,000. Mortgage rates ended January 2020 near 3.5%, keeping the cost of a home affordable for most households that could manage the down payment. At the time of this analysis, mortgage rates were about 6.6%.

Wages have not kept up

In 2020, a household earning $59,000 annually could comfortably afford the monthly mortgage on a typical U.S. home, spending no more than 30% of its income with a 10% down payment. That was below the U.S. median income of about $66,000, meaning more than half of American households had the financial means to afford homeownership.

Now, the roughly $106,500 needed to comfortably afford the mortgage payment on a typical home is well above what a typical U.S. household earns each year, estimated at about $81,000.

Buyers are teaming up, “house hacking,” and moving to more affordable areas

For a household making the median income, it would take almost 8.5 years before they would have enough saved to put 10% down on a typical U.S. home, about a year longer than it would have in 2020. It’s no wonder, then, that half of first-time buyers say at least part of their down payment came from a gift or loan from family or friends.

With the cost of a mortgage rising, most millennial and Gen Z buyers say the ability to rent out all or part of a home for extra cash is very or extremely important. Cobuying with a friend or relative is another way to help with affordability, something 21% of last year’s buyers reported doing. Long-distance movers are also targeting less expensive and less competitive metros.

Where a home is most and least affordable

Metro areas where a buyer could comfortably afford a typical home with the lowest income are Pittsburgh ($58,232 income needed to afford a home), Memphis ($69,976), Cleveland ($70,810), New Orleans ($74,048) and Birmingham ($74,338). The only major metros where a typical home is affordable to a household making the median income are Pittsburgh, St. Louis and Detroit.

There are seven markets among major metros where a household’s income must be $200,000 or more to comfortably afford a typical home. The top four are in California: San Jose ($454,296), San Francisco ($339,864), Los Angeles ($279,250) and San Diego ($273,613). Seattle ($213,984), the New York City metro area ($213,615) and Boston ($205,253) complete the list.

Methodology

Quarterly median household income is taken from the American Community Survey (ACS) and Moody’s Analytics through 2022. Present-day estimates use quarterly changes in the Employment Cost Index provided by the Bureau of Labor Statistics (BLS) to chain ACS income to the current day.

Years to save for a 10% down payment is the number of years it would take the median household to save for a 10% down payment on a typical home in their metro, assuming a 5% annual savings rate.

Income needed to afford a home with 10% down is defined as the income needed to afford the total monthly payment on the typical home. The total monthly payment is based on the monthly mortgage payment, insurance, property taxes, and annual maintenance costs of the home.

Of course, tech town San Jose and San Francisco lead the nation in income needed to afford a typical home in a market. Los Angeles and San Diego are third and fourth, followed by Seattle. Pittsburgh PA has a lowest income to afford a home, probably because they signed Russell Wilson AND Justin Fields at QB.

Nike has made a pair of shoes fitting Biden’s international image.

Too Much Debt (Coping With Bidenflation) And The Downside Of Federal Housing Policies (No Title Searches On Federally-insured Mortgages)

Households have too much debt, thanks to trying to cope with Bidenomics and Bidenflation.

And much of the debt burden falls on the middle class.

Serious auto delinquencies are on the rise.

And lowest earners saw the biggest increase in credit card delinquenices.

And who voters prefer as of today? Trump on interest rates and personal debt.

In addition to the absurd idea of removing title searches for government-guaranteed mortgages (now rely on attorney opinions), the Biden Administration is considering a homebuyer tax credit … that likely won’t help much.

And if you want to see which lenders have the largest concentrations of commercial real estate (CRE) loans, BankOZK takes the cake as the most concentrated lender.

The more the Biden Administration tries to “help” make housing more affordable, paradoxically makes housing even MORE unaffordable.

The Empire Strikes Out! NY General Business Conditions Crashes By -20.9 In March As Industrial Production Slows To -0.23% YoY In February

The Darth Vader theme seems appropriate for President Magoo’s economic malfeasance. Except that Mr. Magoo is a nice person, Biden is a mean-spirited and corrupt.

The NY Fed’s Empire State Manufacturing crashed and burned in March. NYFRB’s general business conditions index plunged 18.5pts in March to -20.9. A reading below zero indicates contraction, and the measure was weaker than all estimates in a Bloomberg survey of economists. Hey, I though illegal immigrantion was good for the economy!!!

Industrial production fell tp -0.23 YoY in February, not a stellar sign for the economy.

And how about the yield curve?

Weekly Jobs Reports Doesn’t Capture The Disastrous US Jobs Market (Biden’s “Take This Job And Shove It” Economy)

As Johnny Paycheck sang, “Take This Job And Shove It”. Apparently, we are seeing a number of firms scaling back on their workforce.

As a reminder, in the real world labor market, 2024 has been a shitshow of layoffs…

1. Everybuddy: 100% of workforce
2. Wisense: 100% of workforce
3. CodeSee: 100% of workforce
4. Twig: 100% of workforce
5. Twitch: 35% of workforce
6. Roomba: 31% of workforce
7. Bumble: 30% of workforce
8. Farfetch: 25% of workforce
9. Away: 25% of workforce
10. Hasbro: 20% of workforce
11. LA Times: 20% of workforce
12. Wint Wealth: 20% of workforce
13. Finder: 17% of workforce
14. Spotify: 17% of workforce
15. Buzzfeed: 16% of workforce
16. Levi’s: 15% of workforce
17. Xerox: 15% of workforce
18. Qualtrics: 14% of workforce
19. Wayfair: 13% of workforce
20. Duolingo: 10% of workforce
21. Rivian: 10% of workforce
22. Washington Post: 10% of workforce
23. Snap: 10% of workforce
24. eBay: 9% of workforce
25. Sony Interactive: 8% of workforce
26. Expedia: 8% of workforce
27. Business Insider: 8% of workforce
28. Instacart: 7% of workforce
29. Paypal: 7% of workforce
30. Okta: 7% of workforce
31. Charles Schwab: 6% of workforce
32. Docusign: 6% of workforce
33. Riskified: 6% of workforce
34. EA: 5% of workforce
35. Motional: 5% of workforce
36. Mozilla: 5% of workforce
37. Vacasa: 5% of workforce
38. CISCO: 5% of workforce
39. UPS: 2% of workforce
40. Nike: 2% of workforce
41. Blackrock: 3% of workforce
42. Paramount: 3% of workforce
43. Citigroup: 20,000 employees
44. ThyssenKrupp: 5,000 employees
45. Best Buy: 3,500 employees
46. Barry Callebaut: 2,500 employees
47. Outback Steakhouse: 1,000
48. Northrop Grumman: 1,000 employees
49. Pixar: 1,300 employees
50. Perrigo: 500 employees

But, according to the government-supplied data…

The number of American filing for jobless benefits for the first time last week dropped to 209k (vs 218k exp) with the NSA number tumbling to 200k…

Source: Bloomberg

How is this possible, you may ask… well let us show you the ways… New York State claims that its jobless benefits rolls collapsed last week. New York accounted for 99.75% of the weekly change in initial claims across the entire US as shown below…

Source: Bloomberg

Continuing Claims was a shit show – with a massive 112k person downward revision for last week from 1.906 million to 1.794mm. That is the 5th straight weekly downward revision of continuing claims…

Source: Bloomberg

But thanks to the adjustments, it all looks ‘normal’ and ‘stable’ at around 1.8 million Americans…

Source: Bloomberg

And WARN numbers are rising rapidly…

Source: Bloomberg

As a reminder, if you doubt the accuracy of the Biden admin’s data, here’s what the most recent FOMC Minutes said:

“While the recent trends prior to the meeting had been remarkably positive, Fed officials judged that some of the recent improvement “reflected idiosyncratic movements in a few series.”

Even they aren’t buying it, and neither should you!

Biden’s $7.3 TRILLION Budget Is DOA In House, Massive Tax Increases Proposed So Biden Can Spend Even MORE Money (Federal Deficit Expected To Explode To $16 TRILLION Over Next Decade)

Every little thing Biden touches turns into disaster. Like the Federal Budget(consider it the fiscal version of the Afghanistan withdrawal).

Following yesterday’s release of Biden’s $7.3 trillion budget, the Biden administration bragged about lowering the deficit by $3 trillion over the next decade – an average of 0.8% of GDP over that period.

This would consist of roughly $2.6 trillion over 10 years in additional spending programs, offset by around $4.8 trillion in tax increases over the same period. Most of the tax and spending proposals have been included in prior budget proposals from the White House, according to Goldman’s Alec Phillips, however there are several new items.

The budget would increase the corporate alternative minimum tax on book income from 15% to 21%, raising $137 billion over the next decade. It also limits a corporation’s ability to deduct employee pay exceeding $1mm/year, raising $272 billion over 10 years. The largest proposed tax increases include; raising the corporate minimum tax from 21% to 28%, as well as a series of tax increases on high-income earners, including new Medicare taxes, and a new 25% minimum tax on incomes over $100 million, raising $500 billion over the next decade.

Of course, it has zero chance of passing under the current Congress – but that’s not the point.

As one DC strategist wrote in a morning email noted by CNBC‘s Brian Sullivan, the budget deficit will still grow by another $16 trillion over the next decade – and that’s with aforementioned tax hikes.

Without them, the deficit grows to $19 trillion.

In short, talk of ‘$3 trillion saved’ is total bullshit in the grand scheme of things, given how much the national debt will grow in the best case scenario.

“No family budget or business could exist with this kind of math,” says Sullivan.

Yes Brian, no family budget could exist with this kind of math AND SPENDING!

And the national debt is rising by $1 TRILLION every 100 days. Before Spending Joe’s budget!

Go back to sleep Joe. Yellen will wake you up if something important happens. Like the US defaults on its debt.