11 Indications That The US Economy Is In Slow Motion Collapse After 4 Years Of Biden/Harris

Let’s put this in black and white. There are 11 indications that the US economy is in a state of slow motion collapse.

The fact that economic conditions are getting worse is certainly not good news, but it is better to know in advance what is coming. After four years under Joe Biden, the U.S. economy is a giant mess. We have been witnessing a slow-motion collapse right in front of our eyes, and those at the bottom levels of the economic food chain have been experiencing more pain than anyone else. Of course this is one of the biggest reasons why Donald Trump won the election.

Example? Sticky inflation remains far higher under Biden/Harris than it did when Trump was President. Prices remain elevated as you will notice when Christmas shopping!

#1 When the economy is in good shape, holiday spending increases each year. In 2024, only 16 percent of Americans say that they are going to spend more than last year and 35 percent of Americans say that they are going to spend less…

Americans this holiday season say they are seeing a ghost of Christmas past: inflation.

The CNBC All-America Economic Survey finds inflation is still haunting the buying public, leading to what’s shaping up to be just an average season for retailers. Just 16% of respondents say they will spend more, down two points compared to last year. Forty-eight percent said that they’ll lay out the same amount for holiday gifts, up five points. At the same time, 35% say they’ll spend less, down two points as well.

#2 The number of job openings in the U.S. is now the lowest it has been since January 2021, but unlike January 2021 we don’t have a pandemic to blame our poor performance on…

US job openings tumbled last month to their lowest level since January 2021, a sign that the labor market is losing some momentum. Still, posted vacancies remain well above pre-pandemic levels.

The Labor Department reported Tuesday that the number of job openings dropped to 7.4 million in September from 7.9 million in August.

Economists had expected the level of openings to be virtually unchanged. Job openings fell in particular at healthcare companies and at government agencies at the federal, state and local levels.

#3 The manufacturing numbers that we are getting are extremely dismal. For example, the Philadelphia Federal Reserve Manufacturing Index just experienced an extremely sharp decline…

The Philadelphia Federal Reserve Manufacturing Index, a critical gauge of the general business conditions in Philadelphia, has reported a significant drop. The actual figure stands at -16.4, a sharp decline that suggests worsening conditions for manufacturers in the region.

This figure starkly contrasts with the forecasted number of 2.9, highlighting a more severe downturn than initially predicted. Analysts had anticipated a positive shift, indicating improving conditions, but the actual data presents a different, more concerning situation.

Moreover, when compared to the previous index value of -5.5, the current reading of -16.4 further emphasizes the severity of the decline. This continuous drop indicates a concerning trend for manufacturers within the Philadelphia Federal Reserve district.

#4 Thanks to rapidly rising mortgage rates, the average U.S. homebuyer just lost $33,250 in purchasing power in just six weeks…

Mortgage rates hit 7% on October 28, the highest level since the start of summer and up nearly one percentage point from the 18-month low they dropped to in mid-September.

A homebuyer on a $3,000 monthly budget can afford a $442,500 home with a 7% mortgage rate, the daily average 30-year fixed rate on October 28. That buyer has lost $33,250 in purchasing power over the last six weeks; they could have purchased a $475,750 home with the 6.11% average rate on September 17. That was the lowest level since February 2023.

#5 Our cost of living crisis is officially out of control. According to Bank of America, almost a third of all households “spend more than 95% of their disposable income on necessities such as housing costs, groceries and utility bills”…

Many Americans are still in a tough spot: Nearly 30% of all US households this year said they spend more than 95% of their disposable income on necessities such as housing costs, groceries and utility bills, according to a Bank of America Institute report, up from 2019 levels.

#6 A recent Lending Tree survey discovered that nearly a quarter of all households couldn’t pay their entire power bill at some point within the past year…

LendingTree’s findings about electricity bill costs comes as it reported 23.4% of Americans experienced an inability to cover their entire energy bill or portions of it in the last year, based on Census Bureau Household Pulse Survey data.

#7 The same Lending Tree survey found that about a third of all households had to reduce spending “on necessary things” within the past year in order to pay utility costs…

Needing to cover utility bills prompted 34.3% of Americans to curb their spending on necessary things – or eliminate some altogether – in at least one instance in the prior year, LendingTree said.

#8 As I discussed last week, demand is at record levels at food banks all over the nation…

Why is demand at food banks all over the country higher than it has ever been before? The media keeps insisting that economic conditions are just fine, but it has become quite obvious to everyone that this is not true. In particular, the rising cost of living has been absolutely crushing households from coast to coast. In the old days, most of the people that would show up at food banks were unemployed. But now food banks are serving large numbers of people that actually do have jobs but that don’t make enough to pay for all of the basics. The ranks of the “working poor” are growing very rapidly, and this is creating an unprecedented crisis all over America.

#9 During normal times, troubled retailers would at least wait until after the holiday season to throw in the towel. But we haven’t even reached Christmas and Party City has already announced that it will be closing all stores…

Party City is closing down all of its stores, ending nearly 40 years in business, CNN has learned.

CEO Barry Litwin told corporate employees Friday in a meeting viewed by CNN that Party City is “winding down” operations immediately and that today will be their last day of employment. Staff were told they will not receive severance pay, and they were told their benefits would end as the company goes out of business.

#10 Not to be outdone, Big Lots has announced that all 936 of their remaining stores will be shutting down on a permanent basis…

Big Lots is beginning ‘going out of business’ sales at all its stores across the US, as it prepares to close its remaining locations.

The discount retail chain filed for Chapter 11 bankruptcy in September, and has already shut hundreds of stores nationwide.

In a press release Thursday, the company said it would begin the sales at its 963 remaining locations, after a sale to a private equity firm fell through.

#11 As of the end of November, more than 7,000 store closings had been announced in the United States. That is a 69 percent increase from last year…

According to a report from CoreSight Research, U.S. retailers had announced more than 7,100 store closures through the end of November 2024, which represents a 69% increase compared to the same time in 2023. These closures are spread across numerous different sectors of retail from auto parts to restaurants to pharmacies, leaving many consumers wondering which companies will survive. This brings us to GameStop, the beloved retail gaming store, which has not only been closing hundreds of retail store locations since 2020, but also appears to be on track to close hundreds more of its locations in the very near future.

This is what a failing economy looks like.

Last week, a prominent mall in downtown San Francisco was empty of shoppers in the middle of the afternoon…

Look at all of these beautiful Christmas decorations at the Crocker Galleria mall in San Francisco. It’s 4:47 PM and everybody should be shopping and buying Christmas presents for their family, but nobody is in this mall.

There are only three stores left that are open here. The escalators hum on inside this beautiful but empty decorated mall.

Outside on Market Street the fentanyl addicts lay folded over while a street performer sings Last Christmas to an empty Street.

Of course the lack of shoppers at that particular mall is just the tip of the iceberg.

Unfortunately, the truth is that downtown areas all over California “are crumbling under the weight of homelessness and drug addiction”…

California’s biggest downtown areas are crumbling under the weight of homelessness and drug addiction, causing a vital part of its economy to dry out.

Cities like Los Angeles and San Francisco have made countless headlines since the pandemic about their drug-infested streets where businesses are quickly pulling out due to high crime rates and low consumer passage.

The number of drug addicts in America is at the highest level ever.

The number of homeless people in America is at the highest level ever.

They are victims of our slow-motion economic collapse, and the holidays will not be very happy for them.

So if you still have food on the table and a warm home to sleep in, you should consider yourself to be incredibly blessed.

Sadly, more Americans are being forced out into the streets with each passing day as the slow-motion collapse of our economy accelerates.

Merry Christmas!

The Brave New World? Job Finding Rate Collapses As Philly Fed Business Conditions Plummet

It is a brave new world as the US attempts an Argentina-like shift from an over-regulated, corrupt economy to a more free economy. While Argentina has Javier Milei, the US is stuck with greedy Democrats and RINOs and their bloated spending sinking any attempt to cut wasteful spending.

So as we transition from woefully corrupt and demented Joe Biden to Donald Trump, the labor market is … terrible. The job finding rate of unemployed workers has collapsed.

This occurred as the Philly Fed Business Outlook plummeted.

Here is Javier Milei of Argentina and The View’s image of a libertarian leader, Javier Bardem from No Country For Old Men.

Fed Drops Target Rate By 50 BPS, Assets Smashed, Gold Falls More Than 2% (Fed Predicts Fewer Rate Cuts In 2025)

As expected, Powell and The Fed dropped their target rate by 50 basis points yesterday, deflating some of the air in the asset markets, More rate cuts will come, but at a slower rate.

Gold got clobbered but has somewhat rebounded.

Bitcoin did likewise: dropping like a rock then bouncing back somwhat.

But gold and bitcoin/ethereum are down again.

The CBOE VIX volatility index exploded upwards.

Powell is looking old, like most of Congress and Biden.

BIG Bubbles? Biden/Democrats Spending Spree + FED = Massive Asset Bubbles = OVERVALUATION In Stock Market And Housing (Buffett Indicator, SP500 Mean Reversion, Shiller PE Ratio, CaseShiller To Gov Spending)

Apparently, the late Hawaiian crooner Don Ho foresaw Biden’s irresponsible spending spree. That is, BIG BUBBLES.

Let’s start with the Buffett Indicator (Warren, not Jimmy!). It indicates that the stock market is STRONGLY OVERVALUED.

The S&P 500 Mean Reversion Model also shows the stock market to be STRONGLY OVERVALUED.

How about the Shiller P/E Ratio? Also showing strong overvaluation.

House prices under Biden have exploded partly due to the outrageous Federal spending following COVID.

The Feral Reserve also had a hand in the housing bubble. While mortgage rates remain high (relative to the Trump years), The Fed’s balance sheet remains elevated.

To be sure, some Republicans were complicit in the spending spree. But mostly it was Democrats and the Biden/Harris Administration … which is still doling out millions.

Biden Boogie! Biden’s Final Punch In The Jaw, Greatest Fiscal Deficit To Start The Year In History, Largest Debt Load, Interest Expense Now Exceeds Social Security

It is the Biden Boogie!

Joe Biden is leaving the Presidency with an attrocious record. While saying he is leaving Trump with the strongest economy in modern times, the is actually leaving Trump and Republicans with a hollow shell for an economy. It is the final punch in the jaw from an angry, failed President.

The following chart shows that in October and November, the US deficit exploded to a staggering $624.2 billion, and even though this included several calendar adjustments – which explains the freak September surplus which as we said was due to calendar effects – the November deficit of $367 billion was $14 billion more than consensus estimates of $353 billion. Worse, combining October and November we find that not only was the combined number of $624 billion some 64% higher than the corresponding period one year ago, but it was also the highest deficit on record for the first two-months of the year (and that includes the spending insanity during the covid crisis).

Putting the deficit in context, the budget deficit in October and November – the first two months of fiscal 2025 – are now officially the worst start a year for the US Treasury on record.

No wonder even Statist Janet Yellen (Treasury Secretary who failed utterly at her job) apologized that her abysmal performance. “I am concerned about fiscal sustainability and I am sorry that we haven’t made more progress,” she said adding that “I believe that the deficit needs to be brought down especially now that we’re in an environment of higher interest rates.” Meanwhile Biden keeps handing out $$$ to Ukraine, Africa, Syria, illegal immigrants and anything else that asks … unless it it American citizens. Man, does Biden HATE America!

Here is Yellen’s record on debt. A total of $15.2 TRILLION under her leadership.

Under Biden/Yellen (don’t forget Senate fools like Schumer and McConnell!), debt interest has surpassed Social Security and Medicare as the second largest government agency expense.

Biden is a classic progressive Democrat, spending other people’s money like a wild man (sort of like California Governor “Greasy Gavin” Newsom’s father. Or grandfather. And let’s not forget the $222 TRILLION in UNFUNDED liabilities such as Social Security and Medicare.

“See Joe, I can destroy California’s economy just like you destroyed the US economy!”

Rise! CMBS Continues To Struggle Under Biden/Harris (Delinquency Rate For Office Space Hits 10.4%)

CMBS delinquencies are on the rise.

The delinquency rate for commercial mortgage-backed securities (CMBS) tied to office properties reached 10.4 percent in November 2024, approaching the 10.7 percent peak reached during the 2008 financial crisis. The ascent is the fastest two-year increase on record, with rates climbing 8.8 percentage points since late 2022, significantly outrunning the 6.3-point rise seen during the financial crisis nearly 15 years ago.

The office real estate sector has been grappling with a severe downturn for several years now, but are accelerating recently as they are driven by persistently high vacancy rates and declining rents. Property values, particularly for older office buildings, have plummeted, with many losing 50 to 70 percent of their market value and in some cases becoming effectively worthless. Those conditions have left real estate portfolio managers and building owners unable to borrow, refinance or sell properties, contributing to rising delinquencies and foreclosures. (Mortgages become effectively delinquent when payments are missed beyond a standard 30-day grace period.)

On the CMBS front, there have been no upgrades in 2023 and 2024.

Efforts to convert office buildings into residential spaces are increasing but remain limited by structural and economic constraints. Many office towers are unsuitable for conversion due to their large floor plates or prohibitively high retrofitting costs which often exceed the cost of demolition and rebuilding. In 2024, 73 office-to-residential conversions were completed, with an additional 30 underway. Despite plans to increase the pace in 2025, the cumulative impact remains minimal, addressing just 7.9 percent of the 902 million square feet of vacant office space nationwide.

Milton Waddams personifies the disastrous progressive politics of Biden/Harris.

JOLT! Job Opening Unexpectedly Surge With Biggest Increase in 14 Months (Quits Also Soar)

The Biden/Harris economy is a disaster.

After last month’s catastrophic JOLTS report, which was a disaster across the board, and which was meant to give the Fed a green light to cut rates more after Biden won the election (which he didn’t, but the Fed still had to cut even if Trump is now in control), some speculated that Biden’s Department of Labor will do everything in its power to sabotage further rate cuts by the Fed, most notably the upcoming December decision in two weeks time, by pushing out much stronger than expected economic data. That’s precisely what happened moments ago when the DOL reported that in October, the number of job openings in the US soared by a whopping 372K, the biggest monthly increase since August 2023, to 7.744 million from 7.372 million.

The JOLTS print smashed the median estimate of 7.519 million by 225K…

… with just 4 analysts (out of 28) predicting a higher job openings number.

According to the DOL, the job openings rate, at 4.6 percent, changed little over the month. The number of job openings increased in professional and business services (+209,000), accommodation and food services (+162,000), and information (+87,000) but decreased in federal government (-26,000).

Amusingly, after we mocked two months ago the stunning surge in construction job openings just as a record chasm had opened between the manipulated number of construction jobs and openings…

… which meant the biggest monthly surge in construction job openings on record at a time when the housing market has effectively frozen thanks to sky high interest rates, a simply glorious paradox of manipulated bullshit data…

… the BLS realized that it had to make an adjustment after getting called out, and Construction Job openings dropped by another 9K to 249K and back to post-covid lows. Oh, and yes, the number of “construction jobs” is about to fall off a cliff just as soon as Orange Man Bad enters the White House.

Setting the glaring data manipulation aside, in the context of the broader jobs report, in October the number of job openings was 770K more than the number of unemployed workers, an increase from the previous month and not too far from inverting once again, similar to what happened during the covid crash.

But while the job openings surge was a surprising reversal of the deteriorating trend observed for much of 2024, where even the DOL was stumped was the number of hires, which tumbled from 5.582 million to 5.313 million, a new post-covid low.

Commenting on the plunge, SouthBay Research notes that “hiring was weak in October and the last time hiring was this low was June and NFP slowed to 118K. But remember that this data aligns with the October Payroll data – not November’s. Both October NFP and the latest October JOLTS Hiring data cover the same period (through mid-October).” Furthermore, there were an additional 4 weeks since this JOLTS survey and hurricane recovery (aka hiring) rebounded. In addition, as the Job Openings indicate, employer intent to hire was already underway when this survey was completed.

Meanwhile, the drop in hiring was offset by a surprise spike in the number of Quits, which rose by 228K from 3.098MM to 3.326MM, the biggest increase since May 2023, with quits increasing in accommodation and food services (+90,000).

Finally, no matter what the “data” shows, let’s not forget that it is all just estimated, and it is safe to say that the real number of job openings remains still far lower since half of it – or some 70% to be specific – is guesswork. As the BLS itself admits, while the response rate to most of its various labor (and other) surveys has collapsed in recent years, nothing is as bad as the JOLTS report where the actual response rate remains near a record low 33%

In other words, more than two thirds, or 67% of the final number of job openings, is made up!

Looking ahead to Friday’s November Nonfarm Payrolls, the report will be driven by hurricane recovery, with the JOLTS data pointing to a lot of weakness in exactly the areas October Payrolls slipped. As for organic hiring, there have been no anecdotal signs of hiring pullback heading into November. On the contrary: businesses seem to be inclined to ramp up a bit, now that Trump is president and promises a dramatic easing of regulations.

Existing Home Sales Drop, Worst Drop Since 2013

The last gasp of the Biden/Harris reign of (economic) error!

After existing home sales unexpectedly ticked up in October, analysts expected new home sales to slow after their recent resurgence (-1.8% MoM). They were right… BUT… the magnitude is mind-boggling!

New Home Sales collapsed 17.3% MoM in October. That is the largest MoM drop since July 2013.

Source: Bloomberg

That MoM plunge dragged sales down 9.4% YoY to 610k SAAR – the lowest since Nov 2022

Source: Bloomberg

Of course, all the revisions are lower…

Hurricanes Helene and Milton, which tore through parts of the Southeast, delayed sales in the nation’s biggest housing region and dragged down sales overall.

Sales in the South decreased 28% to 339,000, the slowest pace since April 2020. Sales also fell in the West, but rose in the Northeast and the Midwest.

Source: Bloomberg

Finally, we note that the median sale price of a new home increased to $437,300 in October, the highest in 14 months.

Does this mean November’s data will see a massive surge in new home sales? …even as rates have increased significantly?

Going Down! UMich Inflation Expectations Jump To 16-Year-High, Housing Buying Conditions Remains Depressed

To quote Freddie King, the US is going down.

Longer-term inflation jumped to their highest since June 2008, according to the latest UMich Sentiment survey, while short-term inflation expectations dropped to four year lows…

Housing sentiment (buying conditions for housing) remains depressed under Biden/Harris
“Reign of (economic) error.”

Here is a picture depicting the assassination of the US housing market.

Mortgage Applications Decline -0.1% WoW Due To Declining Mortgage Refis

Mortgage applications were essentially flat last week as rates increased for the fourth time in five weeks, driven by bond market volatility in advance of the presidential election and the next FOMC meeting. The 30-year fixed rate, at 6.73 percent, was at its highest level since July 2024.

WASHINGTON, D.C. (October 30, 2024) — Mortgage applications decreased 0.1 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending October 25, 2024.

The Market Composite Index, a measure of mortgage loan application volume, decreased 0.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 1 percent compared with the previous week. The seasonally adjusted Purchase Index increased 5 percent from one week earlier. The unadjusted Purchase Index increased 4 percent compared with the previous week and was 10 percent higher than the same week one year ago.