“Middle Class” Joe’s War On … The Middle Class (WTI Crude UP 102% Under Biden, Reg Gasoline UP 83%, Diesel Fuel UP 111%)

Joe Biden likes to sell himself as “Middle Class” Joe. But Middle Class Joe declared war on the middle class with executive orders on fossil fuel drilling and killing the Keystone pipeline. Hence, his press conference on reducing inflation left off one thing: he could rescind the aforementioned executive orders. But he didn’t. So its Band-Aids on Band-Aids.

Since Biden was elected President, WTI Crude Oil futures are up 102%. Regular gasoline is up 83% and the lifeline of the shipping industry, diesel, is up 111%. Of course, inflation measures don’t measure the harm to the middle class at 8.5% YoY.

Here is Biden’s speech, blaming everyone but himself for inflation. And then walks away (as usual) when asked a tough question. But he lied. He COULD cancel his executive orders on oil and natural gas exploration, but didn’t. Instead, he blamed Trump and MAGA voters.

Morning Update! S&P 500 Futures UP, Mortgage Rates UP To 5.57%, Apartment Rents UP 20% YoY, WTI Crude Down -1.76%

At least S&P 500 futures are up this morning, an opportunity to buy the dip.

But on the housing front, we see that mortgage rates have pieced the 5.50% barrier and is now at 5.57%.

On the rent side, apartment rents are growing at 19.3% YoY for both Class A and Class B units.

Commodities are down this AM. WTI Crude is down -1.71%, iron ore is down -4.06% and nickel is down -6.29%.

Whoops! After a positive futures reading before opening, the Dow is down near a full percentage point, but the NASDAQ is almost breakeven for the day.

And the 10-year Treasury yield is down 8.6 bps.

As The Boss sang, “We’re going down.”

Weekend Update! Mortgage Rates UP 87% Under Biden, Gasoline UP 80%, Food UP 59%, Commodities UP 63%, WTI Crude UP, Rents UP 17% YoY (Ain’t That A Kick In The … Head!)

As crooner Dean Martin once said, “Let ’em have it!” Ain’t this a kick in the … head.

Perhaps Joe Biden and Fed Chair Jay Powell are channeling Dean Martin by letting us have it.

Since Obama’s 3rd term as President (aka, Biden’s installation as President on January 20, 2021), mortgage rates have risen 87%, regular gasoline prices have risen 80%, CRB foodstuffs are up 59% and Commodities are up 63%.

And don’t forget about America’s energy life force, WTI Crude Oil. It is UP 123% under Biden.

Rents? Rising at a 16.8% rate.

Rents rising, food costs rising, energy costs rising, Biden and The Fed are taking us higher. In terms of prices and cost of living.

Cooler Kings! As Biden Keeps Going Green And Fed Raises Rates, Everything Is Cooling (Mortgage Rates UP, Venture Capital Down 53%, Stocks Crushed, Etc)

The Biden Administration and The Federal Reserve together should be called “The Cooler Kings” in that their policies are putting a Big Chill on the mortgage market and equities.

Mortgage rates are skyrocketing thanks to the Federal Reserve.

The 30-year fixed-rate mortgage averaged 5.27% for the week ending May 5, according to data released by Freddie Mac FMCC, -1.62% on Thursday. That’s up 17 basis points from the previous week — one basis point is equal to one hundredth of a percentage point, or 1% of 1%.

House price growth to wage growth is below the all-time high, but remains above housing bubble levels of 2005-2007.

The Refinitiv Venture Capital Index is down 53% since November ’21 as The Fed cranks up interest rates.

Well, at least commodities are soaring under “The Cooler Kings.” Pretty much everything else is sucking wind.

Home prices are actually falling in some cities, like Toledo Ohio, Detroit Michigan, Rochester NY, and Pittsburgh PA. Even La-La Land (Los Angeles CA) is seeing a drop in median listing price since 2021 of -5.0%.

The question, of course, is whether The Federal Reserve will back off its plans to aggressively raise interest rates in lieu of crashing stock market, venture capital, and possibly home prices.

This is Scorcher VI: Global Meltdown.

Does Biden and The Fed Feel Like We Do?

Powell-Yellenburg Omen? Dow Drops 1,000+ Points, NASAQ Down 5%, Commodities Rally After Lunch As Fed Fear Strikes

It has been a miserable day for markets as The Federal Reserve struggles to get inflation under control.

The Dow fell over 1,000 points today and NASDAQ was down a cool 5%.

Is the Hinderburg Omen back in fashion? Better yet, the Powell-Yellenburg Omen?

While equity markets have gotten clobbered by Powell and the Gang, commodities at least rallied in the afternoon.

Don’t Panic! NASDAQ Plunges 5% As 10Y T-Note Yield Rises +16.1 BPS (NASDAQ Simply Back To Before Fed Announcement, But Treasury Rates Higher)

The headline screamed “NASDAQ PLUNGES 5%!

True, it did, but it simply lost the gain’s from yesterday’s surprisingly mild Fed announcement.

But the 10-year Treasury yield is rising faster than my blood pressure. The 10-year Treasury yield is up to 3.09%.

Cryptos? Bitcoin is down -7.27% and Dash is down -8.23%.

Watch out mortgage rates!!

Don’t panic … about the NASDAQ. EVERYBODY PANIC about rising mortgage rates.

Medusa Touch! US Labor Productivity For Q1 CRASHES To LOWEST Since 1947 As Energy Prices And Inflation Skyrocket

Here’s some simple Medusa math for you: negative growth + payroll gains = negative productivity. Negative productivity + high labor costs = very high unit labor costs. That’s not a pretty picture for the economy or for companies, and the Q1 figures were even worse than expected — productivity fell by 7.5%, pushing unit labor costs up by 11.6%. Nasty.

In fact, labor productivity fell to the lowest level since 1947 and President Harry Truman.

Of course, Biden’s green energy policies have led to crushing inflation.

So, after Fed Chair Powell (aka, Jay The Revelator) said yesterday that “No Signs US Economy ‘Vulnerable’ To Recession”, we saw the S&P 500 index dive 1.5% and the 10-year Treasury yield break through the 3% barrier.

Biden’s policies are a Medusa-touch on the economy.

The new logo for the Biden Administration.

Fear The Talking Fed! Fed Jacks Target Rate Up By 50 BPS, 9 More Rate Hikes A Comin’ (Yield Curve Rises)

Well, the Fed’s talking heads have been saying a 50 basis point hike was coming in May … and it appeared!

And it looks like 9 rate hikes are a comin’ by February 2023.

The Fed’s Dot Plots shows a cooling of Fed rate hikes by 2024 and beyond.

Here is the path of Balance Sheet peel-off.

The US Treasury actives curve is up by 14 bps at the 10-year tenor and up 17 bps at the 2-year tenor.

The plan will see $30 billion of Treasuries and $17.5 billion on mortgage-backed securities roll off. After three months, the cap for Treasuries will increase to $60 billion and $35 billion for mortgages.

I could read the Fed’s speech on their decision, but since The Fed has been so highly politicized, I don’t really care what they say. Only what they do.

Simply Unaffordable! Mortgage Purchase Applications Rise 5% From Previous Week, But Remains DOWN 11% From One Year Ago As Fed Tightens (ARM Share Rises To 9.3%)

Simply unaffordable! US housing, that is. As The Federal Reserve tries to fight inflation caused by Biden’s Medusa-like policies, mortgage rates are soaring and we are seeing an INCREASE in mortgage purchase applications ahead of Fed tightening. Panic in (Fed) Needle Park!

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 April 29, 2022.

The Refinance Index increased 0.2 percent from the previous week and was 71 percent lower than the same week one year ago.

The seasonally adjusted Purchase Index increased 4 percent from one week earlier. The unadjusted Purchase Index increased 5 percent compared with the previous week and was 11 percent lower than the same week one year ago.

Adjustable rate mortgage (ARM) share has risen to 9.3% along with mortgage rates.

Between Biden’s energy policies, Congressional Covid relief and seemingly perpetual monetary stimulus from The Fed, we have 20% growth in home prices despite mortgage rates soaring.

And as The Fed is expected to tighten, mortgage rates hit 5.50%.

Is the US housing market addicted to gov? We will find out if and when The Federal Reserve actually tightens monetary policy.

Winter Is Coming! Natural Gas Price SOARS 216% Under Biden, Heating Oil SOARS 199% (Cost Of Heating Homes Getting Expensive!)

President Joe Biden should do an ad for his energy policies ala Game of Thrones, “Bundle up! Winter is Coming!”

Since Biden was installed as President in January 2021, natural gas futures prices are UP 216% and heating oil is up 199%.

The average price of home electricity has SOARED under Biden, as has the prices of many things.

Fortunately for Biden and Congress, they live in well-heated (and air-conditioned) digs in the DC area and are not exposed to the damage done by Biden’s executive orders on energy.

Biden looks good in that armor!