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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Julius Wong who wrote (160483)	7/23/2020 11:38:50 AM
From: Pogeu Mahone	Respond to of 219938

Home Sales Down -11% from Year Ago, Condos -23%, but Bounce off Lockdown-Lowsby Wolf Richter • Jul 22, 2020 • 73 Comments More signs of a move from the cities to the suburbs? Supply of houses is tight; condos are piling up. By Wolf Richter for WOLF STREET.Sales of existing homes (closed transactions of single-family houses, townhomes, condos, and co-ops) in June fell 11.3% compared to June last year, to a “seasonally adjusted annual rate” of 4.72 million homes, according to the National Association of Realtors. Sales were down 18% from the recent peak in February. On a month-to-month basis, sales bounced off 20.7% from the historic lockdown-low in May (historic data via YCharts): The 11.3% year-over-year drop in the seasonally adjusted annual rate of sales was the sharpest drop, after the plunges in April and May, since April 2011 (historic data via YCharts): Sales fell in all regions, compared to June last year:Northeast: -27.9%Midwest: -13.4%South: -4.0%West: -13.6%Condo sales in deep trouble, house sales drop less, compared to June last year:Single-family houses: -9% year-over-year, to 4.28 million units seasonally adjusted annual rate.Condos and co-ops: -22.8% year-over-year to 440,000 units seasonally adjusted annual rate.From the big cities to the suburbs?This is a theme that is now propagated widely, and anecdotal evidence has been accumulating to support it, including the continued massive weakness in condo sales (-22.8% year-over-year in June after having plunged 41% in May). These “closed sales” in June reflect contracts signed largely in May and April, so it’s early to draw conclusion about a long-term trend. The NAR report also mentions this from-the-city-to-the-suburb theme as a possibility: “Homebuyers considering a move to the suburbs is a growing possibility after a decade of urban downtown revival. Greater work-from-home options and flexibility will likely remain beyond the virus and any forthcoming vaccine.” There had been a huge surge over those ten years in high-rise construction in city centers – condos and apartments, and mostly higher-end. High-density living has its advantages, including short or no commutes, being close to lots of things to do, particularly in lively walkable city cores. High-rise living can also offer panoramic views. But the pandemic has shed a very different light on this type of living arrangement, and it makes intuitive sense to see a move from the city centers to the suburbs, especially now with commutes no longer being an issue for some people as they have switched to work-from-home, with the expectation that this will largely remain in place going forward. Prices rise for single-family houses, barely tick up for condos.The median price of all types of homes – meaning half sold for more and half sold for less – rose 3.5% from a year ago to $295,000. Single-family houses: +3.5% to $298,000.Condos and co-ops: +1.4% to $262,700.Inventory of houses is tight, but condos are piling up.Unsold inventory of homes that are for sale and that haven’t been pulled off the market yet ticked up in June from May to 1.57 million homes, but remains 18% below where it was in June last year. Potential sellers are still not putting their properties on the market, given the uncertainties, the issues related to showing a home during a pandemic, the facts of forbearance that over 8 million homeowners have entered into, and other considerations. But in some markets, this is now changing. For example, in San Francisco, a flood of homes has come on the market, and inventories have ballooned to the highest levels since the housing bust. Supply of all types of homes for sale at the current rate of sales ticked down to 4.0 months, from 4.8 months in May, and from 4.3 months in June last year, thereby returning into the range of the past few years. But there is now large divergence between supply of single-family houses and condos: Supply of single-family houses: 3.8 monthsSupply of condos: 5.3 months. In San Francisco, sellers are suddenly coming out of the woodwork. And the housing market is having a moment. Read... “Pent-up Supply” Floods San Francisco Housing Market, Most Since Housing Bust Enjoy reading WOLF STREET and want to support it? Using ad blockers – I totally get why – but want to support the site? You can donate. I appreciate it immensely. Click on the beer and iced-tea mug to find out how: Would you like to be notified via email when WOLF STREET publishes a new article? Sign up here.

To: Julius Wong who wrote (160483)	7/25/2020 6:29:53 AM
From: Pogeu Mahone	Read Replies (1) \| Respond to of 219938

One Bank Warns Buying Gold Is The Only Hedge Left For The "Great Debasement" by Tyler Durden Fri, 07/24/2020 - 21:05 TwitterFacebookRedditEmailPrint As far as Bank of America is concerned, there are just two themes one needs to know to explain the current "market" (which as the same Bank of America explained last week, is now manipulated to a never before seen extent): the Great Repression and Great Debasement. First the Great Repression - also known as "Don't fight the Fed" - which according to BofA CIO Michael Hartnett is the outcome of $8 trillion in central bank asset purchases in just three months in 2020, has crushed interest rates, corporate bond spreads, volatility & bears. The most perfect example of this repression: the US fiscal deficit soared from 7% to 40% of GDP in Q2’20... ... and less than one month later the volatility of US Treasury market fell close to all-time low. Besides volatility, central bank repression works its magic on yields: case in point Italian & Greek 10-year government bonds which are down to 1%, while US Commercial Mortgage Backed Securities (CMBS) & IG corporate bonds down to 2%, meanwhile the 30-year US mortgage rate just dropped to a record all time low of 3%. As a result of this unprecedented repression (of reality), the Fed has made everyone a winner: Fed has made bulls in every asset class a winner…gold, bonds, credit, stocks, real estate all up big since March lows; levered cross-asset risk parity strategy at all-time high. It also means that BofA's recently preferred "All-weather" portfolio consisting of equal parts of all assets, i.e., 25/25/25/25 stocks, bonds, cash, gold, is up a record 18% in the past 90 days (Chart 7), which is "astounding & abnormal" given 7% historic annual average. This "can't lose" market has also led to fundamental shift in the zeitgeist, as the traditionally bearish narratives of Q2 such as a Democratic sweep, end of globalization, Japanification, narrow “lockdown” leadership of growth stocks is paradoxically morphing into bullish narratives. Here, Hartnett reminds is that "when the only reason to be bearish is there is no reason to be bearish" that's when you sell. And sure enough, recent market moves justify getting defensive: the global equity market cap has round-tripped from $89tn to $62tn back to $87tn, with BofA warning that it is "hard to see financial conditions getting incrementally easier in July/Aug period of “peak policy” stimulus; summer dip in risk assets (e.g. SPX to 3050) likely." And yet, all good times come to an end - otherwise the Fed would have printed its way to utopia decades ago - and the with Great Repression in full force, it also means that the Fed is currently pursuing a just as Great Debasement. Echoing something we have also said, namely that with the bond market now nationalized by the Fed and no longer providing any useful inflationary (or deflationary) signals, the only remaining asset class with any sort of discounting qualities is gold... ... Hartnett writes that interest rate repression means "investors can't hedge the inflationary risk of $11tn of fiscal stimulus via "short bonds"…so investors crowding into "short US dollar", "long gold" hedges. Indeed, US dollar debasement is well underway as the default narrative for US economy with excess debt, insufficient growth, and maxed-out monetary & fiscal stimulus. However, local currency debasement is also underway everywhere else, and so the next market crisis will lead to an even bigger spike in the dollar as global monetary authorities are faced with an even bigger global synthetic short squeeze than the one which sent the USD soaring to all time highs in March. Which is why shorting the dollar to hedge debasement may be profitable for a while but eventually lead to catastrophic consequences. That leaves long gold as the only natural hedge to the central bank "all in" bet of kicking the can until something breaks. That something will likely be gold exploding higher first above $2,000... then $2,500... then $3,000 at which point the Fed's control over fiat currencies, as well asthe illusion that there is no inflation, and the financial regime will finally collapse.