I would like to see Kamala Harris explain why mortgage purchase applications are down -60% under Biden/Harris Presidency. Other than a word salad answer. Or Cottage Cheese.
Mortgage applications decreased 17.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending October 11, 2024.
The Market Composite Index, a measure of mortgage loan application volume, decreased 17.0 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 17 percent compared with the previous week. The seasonally adjusted Purchase Index decreased 7 percent from one week earlier. The unadjusted Purchase Index decreased 7 percent compared with the previous week and was7 percent higher than the same week one year ago.
The Refinance Index decreased 26 percent from the previous week and was 111 percent higher than the same week one year ago.
Housing prices are up 34.2% under Biden/Harris while mortgage rates are up 138.6%.
Perhaps Harris/Walz should adopt the Imperial March from Star Wars as their theme song. Between Biden/Harris uncontrolled immigration disaster helping to destroy New York City, Harris’ statement that she won’t do anything differntly from Biden/Harris is alarming.
The NY Empire survey crashed from +11.5 to -11.9 – the lowest since May. That is the biggest MoM drop since January…
A measure of current new orders plunged nearly 20 points to -10.2 after climbing a month earlier to the highest since April 2023.
The index of shipments decreased almost 21 points to minus 2.7.
The employment index, however, rebounded to 4.1 – the first expansion in a year – while a measure of hours worked also climbed.
Meanwhile, the New York Fed’s gauge of prices paid for materials increased to a six-month high of 29, while an index of prices received by state manufacturers also accelerated.
And with this awful news, the US Treasury yield curve remains downward/upward sloping. I call this the schizophenic yield curve.
The Presidential and Vice Presidential debates thus far feature weak moderators asking lame questions. For example, there are still 97 hostages stll held by Hamas and what would the candidates do to get them released? (Hint: Trump/Vance would have sensible responses. Harris would just laugh and say she was raised in a middle class family and Walz would look like a deer in the headlights. Then we have national debt of $36 trillion, $271K per taxpayer.
But the hidden bomb that will never be discussed is unfunded liabilities (entitlements) such as Social Security and Medicare. Currently, unfunded liabilities are $219 TRILLION or $650K per citizen.
Of course, Biden/Harris have let the southern border wide open to criminals and uneducated Democrat voters who will voter for MORE entitlements.
So, when will the lame debate moderators ask HARD questions? And can Harris attempt to answer one hard question without laughing or falling back on lame “I was raised in a middle-class household.” etc.
But Biden/Harris had help from their deep state partner, The Federal Reserve.
The purchasung power of the US dollar has fallen by a whopping -20% under Biden/Harris. No wonder Harris is afraid to talk to reporters about her plans.
The children in Congress went on a spending spree as a result of COVID resulting in record inflation.
The deep state’s financing arm, The Federal Reserve, certainly helped create inflation by ramping up M2 Money supply around Covid.
Of course, children in Congress and Harris/Walz will use ANY excuse to tax and spend (and borrow/spend). The most recent inflation report had CPI growng at 2.5% YoY resulting in a further decline of purchasing power of the US dollar of -2.5% YoY.
Harris/Walz fully intend to keep shoveling TRILLIONS into green energy transformation and supporting illegal immigrants.
Q2 marks the 11th STRAIGHT quarter of unrealized losses on investment securities for banks, a streak never seen before. The number of banks on the FDIC Problem Bank List increased to 66 and represents 1.5% of total.
This is in addition to price Increases over last 4 years… CPI Medical Care: +7.8% CPI Apparel: +12.7% CPI Used Cars: +18.3% CPI New Cars: +20.5% CPI Food at home: +21.4% CPI Shelter: +23.4% CPI Food away from home: +25.4% CPI Electricity: +29.8% CPI Gas Utilities: +34.9% CPI Transportation: +38.8% US Home Prices: +48.0% CPI Auto Insurance: +52.4% CPI Gasoline: +53.5% CPI Fuel Oil: +54.9%
Don’t spill the wine, its too expensive under Biden/Harris/Powell.
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.
Having put inflation fully in the rearview mirror, the “Powell payrolls pivot” is now complete because as the Fed chair said, “the cooling in labor market conditions is unmistakable” even if it was quite mistakable to the Biden admin’s presstitutes as recently as one month ago.
Which is also why it was imperative for the Biden labor department to admit the truth about the deteriorating labor market: without that -818K revision earlier this week, the Fed would have some pushback to turning fully dovish. But now that we know that a third of the job gains in the last year of Bidenomics were bogus…well, please come save us Chairman Fed.
Or, as TradeStation head of strategy David Russell said, “here comes the punchbowl. Jerome Powell came out swinging today with a litany of dovish signals. He said inflation is on a sustainable path lower and talked about how the job market has cooled to pre-pandemic levels. He drove the point home with a clear call for adjusting policy.”
The market agreed, and quickly cemented at least one rate cut while also pricing in as much as 33% odds of a 50bps rate cut.
Which is all great: after all as we have long said, with the November elections looming, the Fed will do everything to make sure the establishment candidate isn’t distracted by such trivial things as a market crash.
There are just four small problems with this.
First: the Fed will end its tightening cycle and starts the next easing cycle with stocks at all time highs, something that has never before happened in the history of capital markets!
It means that, unless the current expansion ends in a gruesome recession which crushes the economy, the S&P is about to enter a full-blown bubble, which in turn will burst in even more spectacular fashion and force the Fed to not only cut back to ZIRP, but activate NIRP (just like Japan did years ago) and also go right back to QE and buying bonds ETFs. For now, however, as in the next three months ahead of the elections, all shall be well and should serve the all time high in the market to Kamala Harris on a silver platter…. which is precisely why the Fed is doing what it is doing.
Second, this is also the first time in history when the Fed has aborted a tightening cycle having achieved zero home price easing. Indeed, one look at the case-shiller index shows that home prices are the highest they have ever been…
… as are actual asking rents according to Zillow (not that delayed aberration known as Owner-Equivalent Rent).
And then you have Kamala’s promise to provides $25,000 in new home purchase subsidies, which will go straight to the asking price, sending prices even higher.
In short, both home prices and rents, already at record high, are about to go record-er…
Third, while one can technically live without housing or rent, one still needs to eat. And here we find another problem, because not only did the Fed’s rate hikes not contain stock, home or rent prices, but food prices – both at home and away from home – are also at all time high! And guess what cutting rates and stimulating the economy will do to food prices from this point on…
Fourth, and final, the seeds of the next inflationary bubble are already set, because even as the Fed kept conditions tight (or even exceptionally tight), M2 – the broadest money aggregate tracked by the Fed – is once again rising after declining for the past three years.
Of course, there are countless other examples, because besides the above case studies, prices are at all time highs pretty much everywhere else too. But you get the message. The only question is what can possibly go wrong with the Fed launching an easing (i.e., monetary stimulus) cycle with prices for pretty much everything, stocks and homes included, at all time highs and rising.
On Tuesday, it was announced that Presidential candidate Kamala Harris would be supporting President Joe Biden’s tax proposals for 2025, which include a 44.6% capital gains rate and a 25% tax on unrealized gains.
Having used up all of the rest of the batshit, insane, counterintuitive economic dirty tricks left in the “we’ll literally do anything but cut spending” bag, the Biden administration began pushing this tax idea in April 2024 when I first wrote about it. Unrealized gains taxation could be the most destructive idea for our country since prohibition, I joked at the time.
As part of its budget proposal for the 2025 fiscal year, the Biden administration was trying to raise an addition $4.3 trillion over 10 years in the worst way possible: imposing a minimum tax equal to 25 percent of a taxpayer’s taxable income and unrealized capital gains less the sum of their regular tax, for taxpayers with wealth over $100 million.
Biden/Harris pushes taxes way beyond the revenue maximing point, down to the point of deminishing revenues and economic growth. Here is the Laffer Curve.
Putting aside the fact that this high-risk idea only amounts to a pittance, $430 billion per year, the introduction of taxing unrealized gains could be one of the worst slippery slopes we ever dare to roll our country’s economy down.
We could save $1 trillion just by not sending $100 billion a year to other nations for starters.
A tax on unrealized capital gains means that individuals are penalized for owning appreciating assets, regardless of whether they have realized any actual income from selling them.
If you purchased a stock for $100 this year, for example, and it increased to $110 next year, you would pay the assigned tax rate on the $10 capital gain. You didn’t sell the asset, so you don’t realize the $10 appreciation, but must pay the tax regardless.
Taxing unrealized capital gains contradicts the basic principles of fairness and property rights essential for a free and prosperous society. Taxation, if we’re going to have it on income, should be based on actual income earned, not on paper gains that may never materialize.
mplementing such a tax not only deeply infringes upon personal liberty and private property rights — but I can’t help but think about how it also sets a destructive wrecking ball rolling down a slippery slope for the first time in our nation’s history.
And, given the precarious state of our nation’s finances, it doesn’t seem like the best time to start spitballing about new risky ideas that may or may not catch on only because they sound like they are addressing the problem of a widening wealth gap that Federal Reserve policies created and continue to exacerbate to begin with.
If the administration really wanted to address the problem of wealth inequality, it would be setting its sights on the central bank that sacrificed price stability so it could spray trillions of dollars in “stimulus” toward financial assets, while cutting American families paltry checks of just $600, during COVID. When I did the math during COVID, the total amount spent to bail out the country.
Why do we trust any Democrat politiician? I certainly don’t!
Taxing unrealized gains would risk mass sale of US assets and therRich fleeing.
Confounded Interest - Anthony B. Sanders 
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