JOLT! Job Openings Changed Little (10.4 Million In September) As UMich House Buying Sentiment Declines Even Further (To 62 From 144 Last Year On This Date)

The Federal Reserve continues to JOLT markets with excessive monetary stimulus despite numerous reasons why they should back off.

For example, today’s JOLT report (US job openings) revealed that 10.4 million jobs were open in September. This is the fourth consecutive month of 1 million plus job openings, yet The Fed refuses to raise their target rate.

At the same time, the University of Michigan survey revealed that buying conditions for houses dropped to 66 (baseline of 100). To show how bad this is, buying conditions for houses was at 144 this time last year.

UPDATE: UMich revised their number downward to 62, the lowest since 1981.

In The Fed’s mind, they are still chasing at least 3.5% unemployment, the lowest rate under President Trump prior to COVID. But with perpetual million plus job openings GOING UNFILLED, trying to get to pre-COVID unemployment rate of 3.5% is a fool’s errand.

Of course, with The Fed helping to pump up house prices to largely unaffordable levels, it makes sense that enthusiasm for buying expensive homes has crashed.

Meanwhile, The Fed continues to JOLT the economy with excess stimulus.

Overall inflation fears are leading to lowest consumer confidence since 2011.

PLEASE stop JOLTING US!!

Thanksgiving Dinner Staples Are Low in Stock Thanks to Supply-Chain Issues And Federal Policies (Foodstuffs UP 36% From Last Year)

Combine vaccine mandates that lower the workforce and the flood of economic and monetary stimulus by the geniuses in Washington DC, and we have a Thanksgiving problem.

The supply-chain crunch is about to hit another part of American life: Thanksgiving dinner.

Supplies of food and household items are 4% to 11% lower than normal as of Oct. 31, according to data from market-research firm IRI. That figure isn’t far from the bare shelves of March 2020, when supplies were down 13%.

For grocery shoppers this holiday season, it means that someone with 20 items on their list would be out of luck on two of them.

Although U.S. supermarket operators started purchasing holiday items early, aiming to avoid shortages, many holiday essentials are already in short supply.

Turkeys are very low in stock. By the end of October turkeys were over 60% out of stock—lower than the same time last year by more than 30 percentage points. A spokesperson for Butterball LLC, one of the largest U.S. turkey processors, said the company has been experiencing similar labor and supply challenges as other organizations and industries.

Even if you can find a turkey, prices on foodstuffs in general are up 36% from last year.

And to get to the grandparents’ house of Thanksgiving, gasoline prices (regular) are up 24.5% from last year.

You can always shop at Neiman Marcus for a half Thanksgiving dinner for … $376 + $32 shipping. Not for the average American, more for NYC and DC elitists like Biden’s OCC nominee Saule Omarova who wants to bankrupt energy companies.

Biden could lower inflation by 1) stop mandating vaccines, 2) stop shutting off energy pipelines and oil exploration, 3) stop spending trillions of dollars other than Social Security, Medicare and defense.

Frankly, Thanksgiving has gotten so expensive due to Biden’s Reign of Error that I am thinking of alternatives to turkey. Like a Jersey Mike’s turkey and provolone sub.

US Mortgage Rates Falls Below 3% (REAL Mortgage Rate Falls To -3.13%)

The Freddie Mac 30-year mortgage survey rate fell below 3% today to 2.98%.

And with today’s abysmal inflation report, the REAL 30-year mortgage rate fell to -3.13%.

Yes, President Biden is asking his economic council to do something about inflation. How about 1) telling The Fed to back off its outrageous and damaging stimulus and 2) stop shutting down pipelines.

Here is Joe Biden (aka, the Skipper) eyeing inflation from the White House.

Stimulypto! Red-Hot US Inflation Of 6.2% Implies That Fed Funds Target Rate Should Be … 14.94%! (11.10% If We Use Core Inflation)

How insanely overstimulated in the US economy by The Federal Reserve? Today’s red-hot inflation report of 6.2% YoY implies a Fed Funds Target rate of … 14.94%!! According to the Taylor Rule model, The Fed Funds Target rate should be almost 15%.

If we use CORE inflation (that is, CPI less food and energy), The Fed’s Target rate should be “only” 11.10%.

I feel like I am watching re-runs of Gilligan’s Island with Biden as the Skipper and Powell as Gilligan. Thurston Howell III and his wife lovey are the US Congress and Janet Yellen is the Professor. Case in point? REAL average hourly earnings YoY fell to -1.2% under the Gilligan’s Island leadership in DC.

Biden Starts To Freak Out About Soaring Inflation, Orders Economic Council To “Reduce Energy Costs”

This economic council?

Inflation Prints Hotter Than Expected (6.2% YoY)

My heart goes out to households living on a pension. And households who are not in the elite 1% class of Americans. Particularly if they rely on The Federal Reserve and Federal government to keep inflation low.

Inflation (as measured by the Consumer Price Index) rose to 6.2%.

Yes, a large chunk of inflation is thanks to the green American lobby who want energy prices much higher. Due to the chip shortage, we have used cars and trucks soaring in price at 26.4% YoY growth.

Then we have my least favorite, most misleading inflation measure: shelter. According to the BLS, shelter rose “only” 3.5% YoY. Odd since home prices are growing a 20% YoY clip.

I know, I know. The media talking heads will say “temporary price increases.” Even with all the money pumped into the economy??

I know, I know, (CNN)President Joe Biden said Wednesday that inflation statistics showing America’s prices are surging more than they have in 30 years are proof that there is “more work to do before our economy is back to normal.”

Then stop printing money and slow down your terrible crony spending policies!!!

Tuff Enough? Can US Consumers Stand Biden’s Energy Policies? (West Texas Crude UP 58%, Regular Gasoline UP 43%, Heating Oil UP 54% Since Biden Inauguration)

President Biden wants to know if you are Tuff Enough to stand rapidly rising energy prices as he shuts down American supply?

Since Biden’s inauguration, West Texas Intermediate crude prices have soared by 58%, regular gasoline prices have soared by 43% and heating oil has soared by 54%.

How do you spell Federal energy policies? M-O-N-E-Y!

Meanwhile, US households are told to put on more blankets and drive less while the DC elites (like Obama, Kerry and Yellen) fly around the world in fossil-fuel guzzling jets lecturing everyone on the need to get rid of fossil fuels.

Odd, since annual CO2 emissions have declined significantly from 2007 levels.

The face of Biden’s energy policies. Blah-blah-blah.

Where The Fed Sits In One Chart (Taylor Rule Hints At Target Rate Being 8.80% Instead Of 0.25%)

With The Federal Reserve leaving its target rate at 0.25%, but hinting at a tapering (slowdown) of asset purchases, I thought it would be good to present where The Fed sits at the moment.

You can see the rise in the effective Fed Funds rate from 2016 to early 2020, then KABOOM! COVID struck, the effective Fed Funds rate crashed while The Fed dramatically increased their purchases of Treasuries and Agency MBS. Both Treasury and Agency MBS purchases are projected to decline by mid-2022. The Fed’s target rate (purple line) is project to rise to 1% after 2023.

Where SHOULD The Fed Funds Target rate be? How about 8.80% instead of 0.25%.

So we still have over-stimulypto with The Fed projected to raise rates at a snail’s pace.

Face it, Wall Street wants interest rates low, even if inflation burns out of control.

Stimulypto! 10-year REAL Treasury Yield Is -3.9364% And REAL 30-year Mortgage Rate Is -2.30%!

Yes, the US economy has been greatly overstimulated by the Federal government (fiscal stimulus) and The Federal Reserve (monetary stimulus). This has caused inflation that we haven’t seen in a long time.

How overstimulated in the economy? The REAL 10-year Treasury yield (nominal less CPI YoY) is now -3.9364% and the 30-year REAL mortgage rate is -2.30%.

When will Federal stimulypto end?

The Fed’s Folly Of Full Employment (Real Hourly Earnings Growth At -0.814% YoY, Labor Force Participation Remains Below Pre-Covid Levels)

If The Federal Reserve is actually looking to achieve full employment in the USA, then it is a fool’s errand.

Today’s jobs report is both good and bad. The good news? 531k jobs were added, more than expected. The U-3 unemployment rate fell to 4.6%, also better than expected.

The bad news? REAL average hourly earnings growth “rose” to -0.8141% meaning that inflation is outpacing wage growth (despite what Joe Biden said yesterday).

Look at labor force participation both in October and before Covid. After the large decline in LFP, it rose again then leveled-off to near where it is in October 61.6%.

Here is the rest of the story. Zero Hedge had the enticing headline of “October Payrolls Soar To 531K, Smashing Expectations As Prior Months Revised Sharply Higher”. Too bad inflation is eating away at the gains.

Biden: “We have increased labor force participation by inches.”

Employment in leisure and hospitality increased by 164,000 in October and has risen by 2.4 million thus far in 2021. Over the month, employment rose by 119,000 in food services and drinking places and by 23,000 in accommodation. Employment in leisure and hospitality is down by 1.4 million, or 8.2 percent, since February 2020.

Hey bartender!

Here is a video of The Federal Reserve being awakened by the banking crisis in 2008 and again due to COVID.

COVID And The CMBX Cliff (Retail and Office Sectors Still Limping Along Thanks To Shutdowns And Fearmongering)

Nothing has been the same since Covid struck in early 2020.

CMBX BBB-, the reference basket for CMBS 6, was climbing to around $95 prior to the Covid outbreak and resulting recession. The CMBX reference basket is now at $72.25.

CMBX 6 is largely composed of retail and office, both hit hard by Covid and the ensuing lockdowns and fearmongering by the Federal government and main street media.