Entries by Wolf Richter

The Acceleration of Inflation in the Second Half Has Begun, “Disinflation” Honeymoon Terminated

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Estimated Reading Time: 3 minutes

Month-to-month CPI spikes, core CPI and core services CPI accelerate, despite ongoing massive health insurance adjustments.   The Consumer Price Index (CPI) jumped by 0.63% in August from July, the biggest month-to-month increase since June 2022. Annualized, this amounts to a red-hot 7.8%. This jump comes despite the still ongoing ridiculous monthly adjustment to the health […]

The Collapse of the EV SPACs: Another One Goes Bankrupt, Others on the Verge

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Estimated Reading Time: 2 minutes

Editors’ Note:  As the news rolls in of one EV disaster after another, the easy money and greed of Wall Street have to be examined. However, it also should be noted this is part of a government, top-down, problem of central planning. Politicians have a dream and if the dream does not comport with reality, […]

Curse of Easy Money: US Government Interest Payments v. Tax Receipts, Average Interest on Treasury Debt, & Debt to GDP

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Estimated Reading Time: 2 minutes

Spiking Interest payments will hopefully, knock on wood, force the drunken sailors in Washington to go through detox.   The gigantic US government debt is now approaching $33 trillion, amid a tsunami of issuance of Treasury securities to fund the mind-blowing government deficits and roll over maturing securities. At the same time, the Fed has hiked its […]

Powell Smacks Down Calls to Raise 2% Inflation Target: “2% Is and Will Remain our Inflation Target”

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Estimated Reading Time: 2 minutes

He fretted about the re-accelerating economy flying above the “below-trend” growth required to get to 2%. “We will keep at it until the job is done.” The most important aspect of Fed Chair Jerome Powell’s speech today [8/25/23] at the Jackson Hole Symposium was his total and repeated smackdown of the folks that had either […]

Mortgage Rates Jump to Holy-Moly 7.09%, FHA Rates to Highest in 20 Years, Pulling Rug Out from Under Home Sales in August

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Estimated Reading Time: 2 minutes

Mortgage applications to purchase a home: -40% from 2022 and 2019, 3rd worst week since 1995, behind only two weeks in February. The 7%+ mortgages are doing their magic on the housing market as they keep buyers out of the market, and home sales sagged further in late July and August, from already dismal levels, […]

The Most Splendid Housing Bubbles in America: July Update

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Estimated Reading Time: 2 minutes

3rd Year-over-Year Price Drop in a Row. Monthly Increases Are “Just Seasonal”: Robert Shiller   Home price rise since 2012 “may be coming to an end”: Shiller. Biggest YoY drops: Seattle, San Francisco, Las Vegas, Phoenix, San Diego, Portland, Denver, and Dallas. “Probably what’s happening with the increase in home prices, it’s just seasonal, it’s […]

The Most Splendid Housing Bubbles in America, June Update

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Estimated Reading Time: 2 minutes

2nd Overall YoY Price Drop since 2012. Biggest in Seattle, San Francisco, Las Vegas, Phoenix, San Diego, Portland, Dallas… It’s spring selling season, when prices always rise month-to-month, and they did, but it wasn’t enough.   It’s still spring selling season when sales volume and prices nearly always rise on a month-to-month basis, and they […]

Construction Spending on US Manufacturing Plants Soars, to De-Globalize Supply Chains?

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Estimated Reading Time: 2 minutes

The driver: computer, electronic, and electrical manufacturing.   The amount spent on building manufacturing plants in May in the US jumped by 73% from a year ago, and by 147% from May 2021, to $15.7 billion, according to Census Bureau data today. This by far outpaces the increase in construction costs (more on that in […]

US National Debt Hits $32 Trillion, Up $572 Billion Since Debt Ceiling Suspended. TGA Starts Refilling, Drains Liquidity From Markets

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Estimated Reading Time: 2 minutes

Debt doesn’t matter. Until it does. And now it does.   The U.S. national debt spiked by $572 billion since the debt ceiling was suspended two weeks ago after the sarcastically named “Fiscal Responsibility Act of 2023” was signed into law, the Treasury Department reported Friday evening. The total government debt now exceeds $32.0 trillion […]

The End of Easy Money: Bankruptcy Filings Pile Up at Fastest Rate since 2010

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Estimated Reading Time: 2 minutes

A cleansing process, long overdue, to whittle down the corporate debt overhang and clear out deadwood, at the expense of investors.   It’s turning into a banner year for corporate bankruptcy filings, after years of Easy Money that caused all kinds of excesses, fueled by yield-chasing investors, in an environment where the Fed had repressed […]