U.S. Pending Home Sales Rebound (+7.5% MoM) To Highest Level Of The Year, BUT 5th Straight Month Of Negative YoY)

A forward-looking gauge of U.S. home purchases rebounded in October to a 10-month high, signaling steady housing demand despite growing affordability concerns among many prospective buyers.

The National Association of Realtors’ index of pending home sales increased 7.5% from a month earlier to 125.2, according to data released Monday. The median estimate in a Bloomberg survey of economists called for a 1% advance.

But it is the fifth straight month of year-over-year declines.

Low mortgage rates and solid job growth have supported housing demand this year as pandemic-weary buyers seek more spacious accommodations. Existing home sales are on track to exceed 6 million in 2021, which would be the strongest in 15 years, Lawrence Yun, NAR’s chief economist, said.

Yes, humongous stimulus from The Federal Reserve will help push existing home sales to exceed 6 million in 2021.

Still, competition over a scant number of listings — particularly on the lower, more affordable end of the resale market — has pushed prices out of reach for many prospective buyers. Builders have struggled to fill the void as supply-chain delays and labor shortages upend construction schedules, exacerbating the inventory crunch.

Yes, inventory of homes available for sale is almost 1/3rd of the homes available in 2010.

Ten years after ... and we have progressively less inventory available.

US New Home Sales Decline 23.1% YoY In October As UMich Home Sentiment Plummets

While some economists are cheering the post-COVID economic recovery, I am not among them. Rampant inflation and bad economic policies are plaguing the non 1% of the population.

For example, new home sales dropped -23.1% YoY in October. As consumer sentiment for housing crashed to 63 (baseline of 100).

Why are consumers bummed-out about buying housing? How about rapidly accelerating new home prices???

October Country! US 1-Unit Housing Starts Decline -10.6% YoY As Housing Sentiment Crashes (High Housing Price Inflation Is Hurting)

US housing starts for October were less than expected. A 1.5% increase MoM was expected, but housing starts actually fell -0.7% MoM.

5+ unit (multifamily) starts were up 6.82% MoM. 1-unit single family detached units were down -3.89% MoM. Permits to build were up 4% MoM.

On a YoY basis, 1-unit start declined -10.6% as M2 Money growth continues to fall.

And 1-unit housing starts have fallen with the rapid decline in home buying sentiment.

1-unit starts have slowed to pre-COVID levels, thanks in part to The Federal Reserve’s money printing bonanza which may never end.

As housing sentiment crashes (due to rapid home price growth), we are seeing the demand for multi-family housing rise. 5+ unit (multifamily) starts were up 6.82% MoM in October.

It is October after all as winter sets in.

What’s Wrong With This Picture? M2 Money Growth “SLOWS” To 12.8% YoY As Real Earnings Growth Slows To -1.6% YoY (Will Omarova As Comptroller Make This Better??)

Highlights for Children has a popular segment called “What’s Wrong With This Picture?”

I give you my economics version of “What’s Wrong With This Picture?” It features The Federal Reserve’s M2 Money year–over-year compared with Real Average Weekly Earnings year-over-year.

Yes, M2 Money growth has “slowed” to 12.8% YoY while US Real Average Weekly Earnings YoY is now -1.6%. In other words, while M2 Money is still growing at a rapid pace, real weekly earnings growth is NEGATIVE.

The Fed continues to pump money into a bottle-necked economy while The Federal government pays people NOT to work.

The US Senate has a plan to fix the problem: Biden has nominated Saule Omarova, a dingbat law professor from Cornell (alma matter for The Office’s Andy Bernard), who proposes the following:

(1) Moving all bank deposits from commercial banks to so-called FedAccounts at the Federal Reserve;

(2) Allowing the Fed, in “extreme and rare circumstances, when the Fed is unable to control inflation by raising interest rates,” to confiscate deposits from these FedAccounts in order to tighten monetary policy;

And Ohio Senator Sherrod Brown (D-of course) thinks there is NO MORAL HAZARD PROBLEM with The Fed confiscating bank deposits for its own use?????

If I was attending Omarova’s confirmation hearing, my verdict would be ..

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!!

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?

U.S. Pending Home Sales Fell by More Than Expected in February (-7.19% YoY) With Sinking Real GDP Growth

US pending home sales declined -2.3% MoM and -7.19% YoY as US GDP sinks like a paralyzed falcon,

(Bloomberg) — The National Association of Realtors’ index of pending home sales decreased 2.3% in September from a month earlier to 116.7, largest drop since April, according to data released Thursday.

The median estimate in a Bloomberg survey of economists called for a 0.5% advance.

Compared with a year earlier, contract signings were down 7.2% on an unadjusted basis”

Forecast range from -4.6% to 4.5% from 30 economists surveyed

Signings declined in all four U.S. regions from the prior month, led by a 3.5% drop in the Midwest
Unlike existing-home sales, which are calculated when a contract closes, the index of pending home sales is based on contract signings

Treasury Secretary Janet Yellen: “What, me worry?”

Stimulypto! US Q3 Real GDP Falls To 2% QoQ On Consumption Crash (Atlanta Fed GDPNow Falls To 0.195%)

Despite the staggering and unorthodox monetary stimulus from The Federal Reserve, US real GDP continues to fall. The Q3 real GDP report is out and real GDP QoQ fell to 2%. Not surprising given that the Atlanta Fed’s GDPNow tracker is at a dismal 0.195% and falling.

The culprit? Personal consumption fell to 1.6% in Q3 after hitting 12% in Q2.

The GDP price index actually declined slightly from 6.1% to 5.7%.

Of course, Bloomberg blames the decline in GDP on supply constraints … which were created by The Fed and Federal government dumping trillions of dollars of stimulus. While the monetary stimulus is still raging, Federal government stimulus has worn out. To paraphrase BB King, “The fiscal stimulus is gone.”

Yes, The Federal Reserve and the Federal government reacted insanely to the Covid crisis and created a total mess (including ill-advised government lockdowns of the economy, stimulus to households who already were employed, etc.)

Bloomberg News headline of “U.S. Posts Weakest Growth of Pandemic Recovery on Supply Woes” misses the point that The Fed and Federal Reserve CAUSED the supply woes. It reminds me of an episode from the British comedy series “Blackadder” with Rowan Atkinson, Hugh Laurie and Stephen Fry.

General Melchett:
[explaining why they can’t rescue Captain Blackadder] Now George, you remember when I came down to visit you when you were a nipper, for your sixth birthday? You used to have a lovely little rabbit, beautiful little thing, do you remember?

Lieutenant George:
Flossie.

General Melchett:
That’s right, Flossie! Do you remember what happened to Flossie?

Lieutenant George:
You shot him.

General Melchett:
That’s right! It was the kindest thing to do after he’d been run over by that car.

Lieutenant George:
By *your* car, sir.

General Melchett:
Yes, by my car. But that, too, was an act of mercy when you remember that that dog had been set on him.

Lieutenant George:
*Your* dog, sir.

General Melchett:
Yes, yes, my dog. But what I’m trying to say, George, is that the state young Flossie was in after we’d scraped him off my front tyre, is very much the state that young Blackadder will be in now: if not very nearly dead, then very actually dead!

For those of you who watched Blackadder, think of The Fed and Federal government as being populated by Baldricks.

Speaking of people acting like Baldrick …

US New Home Sales Rise 14% In September As Median Prices Rose 20.1% YoY (Fed Pumping Trillions Into Clogged Economic System)

US new home sales rose a whopping 14% in September as the median price of new home sales rose 20.1%.

Existing home sales still remain low allowing median prices to soar with Fed money printing.

New home sales surged as The Fed turns a blind eye to out-of-control inflation in prices.

Thanks to The Fed, new homes under $150,000 have disappeared and new homes over $500,000 have grown to 31% of all new homes. Where have all the starter homes gone?

Between Fed stimulypto and massive over-spending by Congress and the Biden Administration, the economic system is clogged like an interstate toilet, driving construction prices soaring.

Apparently Fed Chair Jerome Powell and Treasury Secretary Janet Yellen have never experienced clogged plumbing in their homes. And President Joe Biden has probably forgotten.

I can’t wait to hear if Biden’s press secretary Jen Psnarki attempts to put a positive spin on this debacle.

US Home Prices Still Soaring! Case-Shiller National HPI UP 19.84% YoY In August As Fed Stimulus Remains (Phoenix AZ UP 33.31%)

Between The Federal Reserve’s unorthodox monetary policy and insane spending from Congress and Biden Administration, we are seeing a near 20% rise in home prices for August.

Please note that pre-COVID the Case-Shiller home price index (national) was growing at 4%. Thanks to Fed Stimulypto, home prices are roaring at near 20% YoY.

Phoenix AZ home prices are growing at a 33.31% pace. The slowest growing? The US “shoot ’em up” capital, Chicago, is growing at 12.72% and is the slowest growing Case-Shiller 20 city.

I feel like I am living in the movie “Cloverfield” with The Federal Reserve as the uncontrollable monster.

UPDATE: Columbus Ohio as of Q2 2021 is growing at a 13% YoY pace.