Category: Yellen

ADP Report Shows Big Job Losses In October, 45,000 Job Losses (Rate Cuts Around The Corner?)

The Federal government is still shut down, so we have to rely on ADP for jobs numbers.

The ADP weekly jobless report pointed to a deterioration in US labor momentum, stating that “for the four weeks ending Oct. 25, 2025, private employers shed an average of 11,250 jobs a week, suggesting that the labor market struggled to produce jobs consistently during the second half of the month.”

Added together that is 45,000 job losses in the month (not including government workers), which would be the largest monthly drop in jobs since March 2023.

A sustained increase in layoffs would be particularly concerning now because the hiring rate is low and it is harder than usual for unemployed workers to find jobs.

It is likely that The Fed will cut rates to compensate. Rate cuts around the corner!

Fed Cuts Target Rate By 25 Basis Points, Treasury Yield Curve Rises, Mortgage Rates Drop

Yesterday, The Federal Reserve Board of Governors lowered their target interest rate by 25 basis points to 4%.

And on that decrease, the US Treasury yield curve rose slightly.

And mortgage rates declined with the cut in The Fed’s target rate.

For an interesting read, try David Stockman’s “How To Cut $2 Trillion Om Federal Spending.”

Consumer Prices Rise 3% YoY, Shelter Rises 3.6% YoY (US Treasury Yield Curve Remains Upward Sloping 3Y-30Y)

Good news! Consumer prices rose only 3% YoY. Lower than the growth in M2 Money of 4.66% YoY and Federal government spending of 7.8% YoY.

While consumer prices rose only 3% YoY, housing (shelter) rose 3.65 YoY.

The US Treasury yield curve remains upward sloping from 2Y-30Y.

Federal Government Continues To Spend Like Drunken Sailors In Port Despite Schumer Shutdown (Federal Debt Breaches $38 Trillion, Budget Deficit Breaches $7 Trillion)

Of course, CPI data release has been delayed thanks to the US Federal government shutdown (aka, the Schumer Shutdown). But never fear, the Federal government is continuing to spending like the proverbial drunken sailors in port. The Federal debt just breached the $38 trillion mark.

And the Federal budget deficit just breached the $7 trillion mark. Why? Too much Federal spending! The Federal government COULD raises taxes, but that would strangle the economy. But politicians in DC are terrified of not being re-elected, so they are terrified of cutting spending.

What about The Federal Reserve? M2 Money printed by The Fed now exceeds $22 trillion and The Fed’s balance sheet is now around $6.6 trillion. Can The Fed print our way out of the debt crisis? Think of the Weimar Republic with its hyperinflation due to excessive money printing.

The only way out is to drastically cut Federal spending. Or we could rename the US Dollar as the Reichsmark.

Any wonder why gold and silver prices are through the roof?

Existing Home Sales Print At 4.06 Million Units In September, Commercial Real Estate Still Lower Than Before Covid 19 Outbreak In 2020

September US home sales printed at 4.06 million units.

The US still hasn’t recovered from the Covid 19 outbreak of 2020 and the Fed’s response to Covid.

On the commercial real estate side, CRE prices remain below Covid 19 outbreak levels.

Home Sellers Outnumber Buyers By More Than 500,000 (Largest Gap Ever Recorded)

The US housing market is in a pickle. Home sellers now outnumber buyers by more than 500,000, the largest gap ever recorded.

Can We EVER Return To Pre-Covid Spending Levels? Both US Debt And Spending UP 56% Since Covid Outbreak In 2020

Can we ask the US House and Senate if they will ever return US Federal government spending to pre-Covid levels? Both US Federal government spending and public debt are up 56% since the Covid outbreak in 2020.

The answer is no. Politicians thrive on Federal spending.

Mortgage Demand Decreased 4.7 Percent From One Week Earlier (Purchase Index Decreased 1 Percent)

Feelin’ stronger for the most part.

Mortgage applications decreased 4.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 3, 2025.

The Market Composite Index, a measure of mortgage loan application volume, decreased 4.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 5 percent compared with the previous week. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 14 percent higher than the same week one year ago.

The Refinance Index decreased 8 percent from the previous week and was 18 percent higher than the same week one year ago.

With mortgage rates on fixed-rate loans little changed last week, refinance application activity generally declined, with the exception of a modest increase for FHA refinance applications.

Mortgage demand dwindled since Covid and Biden/Powell and hasn’t recovered.

Downshift! US Home Prices Fall By 0.7% In September, 5th Straight Month Of Declines (Tampa Leads The Decline Followed By San Francisco)

US home prices are downshifting to a lower gear.

Home prices across the top 20 cities in the US fell by 0.07% MoM (less than the 0.2% decline expected) – the fifth straight monthly drop in prices. This pulled the YoY price appreciation down to 1.82%, the lowest since July 2023.

The U.S. housing market continues its dramatic shake-up, with 7 cities seeing outright price declines YoY, lead by Tampa FL.

  • Denver -0.6%
  • San Diego -0.7%
  • Phoenix -0.9%
  • Dallas -1.3%
  • Miami -1.3%
  • San Francisco -1.9%
  • Tampa -2.8%

On the up side, Attom lists the following big gainers in price.

#10 – Wichita County, Texas

  • YOY Percentage Change in Median Home Price: 21.3%
  • Q3 2005 Median Sales Price: $207,280

#9 – Whitfield County, Georgia

  • YOY Percentage Change in Median Home Price: 21.5%
  • Q3 2005 Median Sales Price: $279,500

#8 – Tompkins County, New York

  • YOY Percentage Change in Median Home Price: 22.1%
  • Q3 2005 Median Sales Price: $420,000

#7 – Fayette County, Pennsylvania

  • YOY Percentage Change in Median Home Price: 22.3%
  • Q3 2005 Median Sales Price: $165,000

#6 – Schuylkill County, Pennsylvania

  • YOY Percentage Change in Median Home Price: 23.1%
  • Q3 2005 Median Sales Price: $139,500

#5 – Jackson County, Michigan

  • YOY Percentage Change in Median Home Price: 23.2%
  • Q3 2005 Median Sales Price: $232,920

#4 – Kankakee County, Illinois

  • YOY Percentage Change in Median Home Price: 24.6%
  • Q3 2005 Median Sales Price: $233,750

#3 – Tom Green County, Texas

  • YOY Percentage Change in Median Home Price: 26.8%
  • Q3 2005 Median Sales Price: $283,231

#2 – Saint Louis County, Missouri

  • YOY Percentage Change in Median Home Price: 28.2%
  • Q3 2005 Median Sales Price: $312,500

#1 – Jasper County, Missouri

  • YOY Percentage Change in Median Home Price: 32.1%
  • Q3 2005 Median Sales Price: $241,894 

A simple model of national home prices? Try Fed money printing.

Pending Home Sales In August Surge 4% YoY (Lower Rates Helping, Rates Peaked At 18.63% In 1981)

August data for the US housing market has been ‘mixed’ to say the least with a surge in new home sales (thanks to a massive rise in incentives from homebuilders) and a small decline (near multi-year lows), leaving this morning’s pending home sales data as the tie-breaker (with expectations of an ‘unch’ shift MoM).

It appears the drop in mortgage rates is driving some purchase activity as pending home sales soared 4.0% MoM in August – the most since March – dragging sales up 0.5% YoY.

Mortgage rates are falling, helping existing home sales. Note that the 30-year mortgage rate peaked at 18.63% in 1981.