Entries by Wolf Richter

This Inflation Will Be Tough to Get under Control

Estimated Reading Time: 3 minutes

It’s like a dam broke. And now higher interest rates and mortgage rates for much longer, with lower asset prices, as the Everything Bubble gets repriced.   So now the media suddenly focuses on this big problem I’ve been screaming about for many months: Inflation has shifted from energy and from goods tangled up in […]

Gasoline Demand Destruction Accelerates Despite Plunge in Prices: Consumption Drops to August 1997 Level

Estimated Reading Time: 2 minutes

Long-term stagnation turns into a sharp decline. Over the four weeks through September 9, gasoline consumption dropped by 11.7% from the same four-week period in 2019, to 8.56 million barrels per day on average, below the same periods in 2020 and 2021, according to EIA data today. The EIA measures gasoline consumption in terms of […]

Boots-on-the-Ground Observations by 21 Home Builders about the Housing Market They’re Facing

Estimated Reading Time: < 1 minute

#Phoenix builder: “The positive is there’s light at the end of the tunnel for improving build cycle times. The negative is there won’t be customers on the other side of said tunnel.” We’ve seen the data from the Census Bureau about the downturn in the market for new houses: surging inventories – 11 months’ supply […]

Stock Selloff, Collapse of Cryptos, Meme Stocks & SPAC/IPO Zombies Bringing Day Traders Back into the Labor Force?

Estimated Reading Time: 2 minutes

Interesting stuff happening in the labor market, suddenly.   Employers added 315,000 workers to their payrolls in August, and 1.13 million over the past three months – solid growth. Households reported that the number of working people in regular jobs or self-employed jumped by 442,000 in August, after having been essentially flat for months. There […]

The Most Splendid Housing Bubbles in America, August Update: First Price Drops Appear, All in the West

Estimated Reading Time: 2 minutes

The Case-Shiller index, which lags reality on the ground by 4-6 months, is starting to pick up the price drops in Seattle, San Francisco, San Diego, Los Angeles, Denver, and Portland.   The housing market is going through some navel-gazing, as many buyers evaporated at current prices and mortgage rates. They’re still out there, but […]

All Signs Point to a Housing Recession

Estimated Reading Time: 2 minutes

Sales Plunge to Lockdown Levels, Active Listings Surge, Prices Begin to Dip as Price Reductions Spike, Investors Pull Back Buyers moseyed away from sky-high prices but are still there, just a lot lower, while many sellers hang on to illusions. Inventory and supply of previously-owned homes of all types – single-family houses, condos, co-ops, and […]

Housing Bubble Getting Ready to Pop: The Big Boys Leave, Waiting for Reset

Estimated Reading Time: 2 minutes

Biggest investors in single-family houses: “We need to be patient and allow the market to reset.”   We’re now getting all kinds of commentary from housing industry insiders and big institutional investors in single-family houses. They’re talking about this during their earnings calls. American Homes 4 Rent is one of them. The company was founded […]

Housing Bubble Getting Ready to Pop: Traffic of Prospective Buyers of New Houses Plunges, Homebuilders Cut Prices, Sentiment Dives

Estimated Reading Time: 2 minutes

Homebuilder stocks have been wobbling lower all year, now down between 24% and 40%.   Homebuilders have struggled for well over a year with supply and labor shortages and ridiculously spiking costs. In addition, this year, the new holy-moly mortgage rates added to the woes, and unsold inventories surged to levels not seen since 2008, as […]

Leverage & Interconnectedness Are Blowing Up Crypto & DeFi

Estimated Reading Time: 3 minutes

That’s what’s different this time: Stuff blows up because of leverage and cascades through the crypto space because everything’s interconnected.   Crypto lender and broker Voyager Digital, which also took deposits and offered yield products with huge interest rates of up to 12%, said in a series of tweets today that it is, “actively pursuing […]

Fed’s QT Kicks Off: Total Assets Drop by $74 Billion from Peak, New Era Begins

Estimated Reading Time: 3 minutes

QE creates money. QT does the opposite: it destroys money.   Total assets on the Fed’s weekly balance sheet as of July 6, released this afternoon, fell by $22 billion from the prior week, and by $74 billion from the peak in April, to $8.89 trillion, the lowest since February 9, as the Fed’s quantitative tightening (QT) […]