Slowing! Nonfarm Payrolls Up 142k, 2,358 Jobs Added In August (Considerably Below The Average Of 5,254 Jobs Added Since April 2021)

2023 and early 2024 saw numerous months where BLS reported jobs added increasing by 200k or more. but after May 2024, jobs added have been slowing,

In August 2024, US nonfarm payrolls rose by 142K, with job gains in construction and healthcare. The unemployment rate held at 4.2%, and the labor force participation rate remained steady at 62.7%. Average hourly earnings increased by 0.4% to $35.21.

2,358 jobs were added in August. This is considerably below the average jobs added since April 2021 of 5,254 jobs added monthly.

Both previous months were revised sharply lower, so once again expect the August print to suffer the same fate. Specifically, the BLS said that the payroll print for June was revised down by 61,000, from +179,000 to +118,000, and the change for July was revised down by 25,000, from +114,000 to +89,000. With these revisions, employment in June and July combined is 86,000 lower than previously reported It also means that 4 consecutive job prints have been revised lower, and 6 of the past 7.

Weekly hours worked remains below pre-pandemic average; a fraction of an hour per week may not sound like much, but multiply that by over 150 million people and 52 weeks per year, and that’s a significant difference in man-hours worked and aggregate income.

Yes, the US economy is slowing.

Time Has Come Today! 2Y Yields Plunge To Below 4% As Fed’s Powell Says Time Has Come To Lower Rates

The time has come today! Or People Get Ready! Rates may drop!

US 2y yields plunge to 3.95% as Fed’s Powell says ‘time has come’ to cut interest rates. Says Fed doesn’t seek, welcome further cooling in labor market.

Of course, there is a Presidential election in 60 days and The Fed doesn’t want the Orange Man to win. Instead, they want the Green Gal to win (Kamala Harris). Here is Green Gal (Harris) with Green Porker (Walz).

Here is Kamala Harris at a DNC campaign rally.

Hey Big Spender! US Gov’t Pays $3 BILLION In Interest Per Day (Federal Unfunded Liabilities At $219 Trillion While Total US Assets At $213 Trillion)

Hey Big Spender! (Federal Government).

The US government now pays out on average $3bn in interest expenses per day…If the Fed cuts interest rates by 1%-point and the entire yield curve declines by 1%-point, then daily interest expenses will decline from $3bn per day to $2.5bn per day.

Even worse, unfunded Federal liabilities total $219 trillion while total US assets total only $213 trillion. In other words, if China (for example) forced us to pay off our unfunded liabilities like Social Security, Medicare, etc., we couldn’t.

Notice how NO politician ever discusses The Federal goverment spending LESS money. Particularly not Joe “The fool on the hill” Biden or Kamala “Word salad Kammie” Harris.

Happy Labor Day! Market Pricing In Nearly 250 BPS In Rate Cuts While Biden/Harris Overstate Job Gains By Almost 1 MILLION Jobs

What a long, strange trip it has been under the gross economic mismanagement by the Biden/Harris team.

First, market participants are pricing in nearly 250 basis points (or 2.5%) in rate cuts by Jan 2026. Down to 3% from the cuurent rate of 5.50.

Why? The economy is a shambles due to bad economic policies by Harris/Biden and their Congressional stooges, especially Schumer in the Senate and Pelosi in the House. Hence, The Fed will feel pressure to lower rates. Although I don’t think that it will happen.

Of course, the Philly Fed disclosed that the Biden/Harris administration overstated jobs added by almost 1 million jobs in Q2. I would love to see Harris interviewed about that and watch her deflect and break into gales of laughter. How do American workers feel about Biden/Harris overstating jobs gains by almost 1 million jobs?? Isn’t that fraud?

Yield beta is expected to accelerate.

Biden/Harris-illusionomcs! Pending Home Sales All-time Low While Consumer Spending Is Just Government Handouts

We’ll be fooled again by Harris/Walz??

The Biden/Harris illiusionomics was built on false hoods.

Look at pending home sales, now the LOWEST in history. The midwest led the decline in PHS at -7.8%.

Why? One reason is the illusion of a growing economy … that wasn’t growing organically. It was just Biden/Harris doling out trillions in handouts. Trillions of dollars in annual “consumer spending” is actually just government handouts being spent by people – it’s increased every month this year:

The Broken Arms of Krupp! ThyssenKrupp Has NEGATIVE Enterprise Value (How The Mighty Have Fallen!)

I read “The Arms of Krupp” by William Manchester. A great book about the rise of ThyssenKrupp during World War II. It is one of the world’s largest steel producers, but it now has NEGATIVE ENTERPRISE VALUE.

The cause? Germany is up the creek without an economic paddle after years of gross mismanagement by Angela Merkel and her party. Mass immigration in Germany and a slowdown in the global economy aren’t helping.

A dire warning for America.

Highway To Hell! US Pending Home Sales Index Falls Below Pandemic Low (Now At Worst Ever Level)

Biden/Harrisnomics is the US ecoonomy’s highway to hell.

US pending home sales just fell to below pandemic lows and is officially the worst in history.

Way to go Biden/Harris. The economy distorters and killers. Welcome to NEW Venezuela!

Streets Of Baltimore: Office Tower Sold For $4 Million ($12 Per Square Foot)

The Streets of Baltimore. I don’t think Gram Parsons would like the streets of Baltimore anymore.

A 345k SF office tower in Baltimore sold for $4M That’s a shocking $12 per square foot.

That’s cash on the barrelhead. Unless some poor lender is willing to take a bath on CRE in major metro areas like crime-ridden Baltimore.

Downtown? Office Values In US Metro Areas Have Crashed 52% From Highs (Zombie Towers In Large Cities Creating Drag)

Downtown? I know a place where the crime and congestion isn’t so bad, the suburbs.

Commercial real estate market challenges are more severe for older office towers in downtown metro areas than those outside city centers. The mismatch between funding needs and available credit in a high-interest-rate environment has also intensified the strain on building owners, as elevated tower vacancy rates persist across many markets due to the ongoing trend of remote work becoming the norm.

Aging business districts from Los Angeles to Chicago to Boston of zombie towers with high vacancy rates that have no use in today’s economy.

Big landlords, including Brookfield, Blackstone, and Starwood Capital Group, have walked away from older downtown towers in recent quarters.

The latest data from MSCI shows office values in metro areas have crashed 52% from their highs. Some of the worst declines have occurred in San Francisco, Manhattan, Washington, and Boston.

Between 2019 and 2023, about $557 billion of value evaporated from US offices due to a multi-year slide in demand, with older towers quickly falling out of favor with companies, according to an estimate by economists at Columbia and New York universities. CBRE Group noted that only 2% of towers in the US are considered top-tier, with rents 84% higher than the rest of the market.

Data from brokerage Savills shows office rents in business districts have grown slower than rents for similar buildings outside metro areas.

The move to new towers highlights how, for decades, the bubbles in legacy downtown districts, fueling economies, have ended for now, and older towers will have to be torn down.

To be very frank. It’s a crisis. Democrats running the crime-ridden metro area are delusional and blinded by their woke religion as the city’s population recently crashed to a 100-year low, and violent crime remains a major issue.

We’ve had conversations with multiple folks at wealth management and investment banking firm Stifel Financial about the latest shift of operations outside the dying business district to a new tower in a much safer and newer district. At first, Stifel contemplated leaving the city for the suburbs because far-left Democrats in City Hall could not enforce law and order.

CRE foreclosures are on the rise.

Don’t forget about Soros-funded district attorneys not enforcing the law in large cities. Expect more of the same if Harris/Walz win the election.

Big Bubbles! US Home Prices Up 6.47% YoY, Hit All-time High As Fed Keeps Foot On Monetary Gas Pedal

Big bubbles! US home pricest hit an all-time high as The Fed keeps its foot on the monetary gas pedal following the Covid economic shutdown in 2020.

Home prices in America’s 20 largest cities rose for the 16th straight month in June (according to the latest data from S&P CoreLogic – Case Shiller – data today), up 0.42% MoM (hotter than expected and accelerating from May). On a YoY basis, prices rose 6.47%, but notably that is the third straight monthly slowdown in the pace of price appreciation…

Source: Bloomberg

Overall, US home prices reached a new record high in June (as median new home prices continued to tread water)…

Source: Bloomberg

Home prices continue to track Fed Reserves closely, but a turning point may come soon…

Source: Bloomberg

Given the smoothing and heavy lag in the Case-Shiller data, it’s hard to find a causal relationship between prices and mortgage rates…

Source: Bloomberg

But, with prices reaccelerating and mortgage rates already back below 7.00% – in anticipation of The Fed – WTF does Powell think is going to happen when he actually starts cutting with prices at these record highs.

The Freddie Mac HP index shows the variation in home price growth. New Jersey coastal towns of Atlantic City and Ocean City grew at 10% YoY while Lake Charles LA declined by -2% YoY.