Confounded Interest – Anthony B. Sanders
Financial Markets And Real Estate
US prices rose 0.3% MoM in June according to the Bureau of Labor Statistic (BLS). And on a YoY basis, inflation rose 2.7% while core inflation rose 2.9%.
Supercore inflation was up 3.017% YoY.
As of May, import prices rose a scant 0.0% MoM and 0.2% YoY.
Shelter rose 3.8% YoY in June while gas utilities rose 14.2%.
And on this news, the yield on 30-year Treasuries rose 5%.
Not a chance that Foul Powell will cut rates now.
The U.S. has already brought in nearly $73 billion in revenue from tariffs so far this year, compared to $77 billion in tariff revenue for the entirety of 2024. In Trump’s second term, tariff revenue is over $25 billion.
So much for the hysteria over a stock market crash and massive increase in inflation. Particularly “economists” who say this nonsense. Who are those guys?
Tavi Costa at Crescat Capital (founded by my former MBA student at University of Chicago Kevin Smith) produced this excellent chart of silver prices showing the cup and handle of silver prices.
The rise in silver prices corresponds with a deterioration of the US bond market. Look at Treasury futures courtesy of Bravos Research.
Of course, Washington DC’s insane spending has led to insane money printing by The Feral Reserve.
Everyone in Washington DC deserves a “Silver Cup of Failure” for uncontrolled government waste and spending and mismanagement by The Feral Reserve.
Thank goodness “Statist Joe” Biden is gone. Kamala Harris is still lingering around the edges, while the mortgage and housing markets are still suffering from the Biden/Harris regulatory overreach.
Mortgage applications increased 9.4 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 4, 2025. Last week’s results included an adjustment for the July 4th holiday.
The Market Composite Index, a measure of mortgage loan application volume, increased 9.4 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 13 percent compared with the previous week. The seasonally adjusted Purchase Index increased 9 percent from one week earlier. The unadjusted Purchase Index decreased 13 percent compared with the previous week and was 25 percent higher than the same week one year ago.
The Refinance Index increased 9 percent from the previous week and was 56 percent higher than the same week one year ago.
Mortgage rates moved lower last week, with the 30-year fixed rate decreasing to 6.77 percent, its lowest level in three months. After adjusting for the July 4th holiday, purchase applications increased to the highest level of activity since February 2023 and remained above year-ago levels.
Biden claims the foreign leaders have been calling him for advice. Here is one example.
It’s Gov’t Gone Wild! That includes The House, Senate, President and Federal Reserve.
The purchasing power of the US Dollar was $1004.4 on 1915-03-01. By 2025-05-01, the purchasing power fell to $31.1, a loss of 97%. Public debt since the last year of GW Bush, Obama/Biden (with a brief hiatus with Trump) rose 317% since January 2009.
M2 Money printing grew 210% since January 2009.
So much for the doom porn about tariffs or anything Trump. The US economy is booming. Example? Non farm payrolls (NFPs) in June rose by 147k jobs added.
As opposed to yesterday’s negative ADP report, the NFP continued to grow despite fears of tariffs, etc.
The positive jobs report likely killed any chance of a Fed rate cut at the next meeting.
Covid, the gift that keeps on giving. Government spending grew enormously with Covid in 2020. As a result, M2 Money has grown 34% just since 2020.
At least M2 Velocity is growing again.
New home sales are going down.
New home sales plunged in May, the biggest MoM drop since June 2022.
The median sales price increased 3% from a year ago to $426,600 last month, marking the first year-over-year price gain in 2025.
The plunge in new home sales came as mortgage rates ticked back higher.
Another example of the carnage left behind by President Autopen (Joe Biden).
The Fed continues printing money! And home prices continue to rise on year-over-year basis, but falling on a month-over-month basis.
Home prices in April tumbled 0.31% MoM (-0.02% exp) – the biggest MoM drop since Dec 2022.
But if we look at the national home prices via S&P Case-Shiller and YoY rather than MoM, home prices ROSE 2.64% YoY.
You can see the damage to homeownership caused by Covid and The Fed. The massive expansion of M2 Money in 2020 was followed shortly by rapid increases in home prices. This was followed by a normalization in Fed M2 Money printing. Consequently, home price growth has slowed.
The housing markets is in bits and pieces following The Fed’s fickle management of interest rates and Biden’s disastrous spending policies. U.S. household net worth fell by 0.93% in 1Q2025 … largest decline since 3Q2022, but not necessarily comparable to that quarter in terms of magnitude.
Bitcoin just broke below $100k.
What will The Fed? As I have said over and over again, The Fed needs to cut rates.
Confounded Interest - Anthony B. Sanders 
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