Off-Topic Stock Market & Crypto Discussion

[mr.h]

10:00

USD

ISM Services Employment Index(Feb)

54

2.19

49.8

50

10:00

USD

ISM Services New Orders Index(Feb)

62.6

0.72

58.5

60.4

10:00		USD	ISM Services PMI(Feb)		55.1	0.17	54.5	55.2

10:00		USD	ISM Services Prices Paid(Feb)		65.6	0.49	64.5	67.8

WOW strong numbers..affecting inflation and employment

 

[90scane]

Powell is going to have to reverse course at some point. When he reverses, the markets will bottom 6-12 months later and I'll start using gun powder to buy real estate and stocks. In the mean time, bonds vs cash and pay down bad debt if you have it. One more investment strategy: Capitol Trades https://www.capitoltrades.com/trades?txType=buy

 

[90scane]

:

Housing sales for 2023 is showing a significant drop. I’ll try to get the numbers to show 90’scane. We can easily see a 10% drop. You are right that some investors are going into bonds, but cash is king and investors are waiting for an entry point. Lower rate hikes are already priced in for the first half of 2023.
unfortunately earnings will suffer. Yes clusterfuq is where we are now.

Just because housing sales are dropping doesn't mean housing prices will follow. There is a demand for homes and a lack of supply. Thus, transaction volume has dropped significantly but median home prices haven't followed that path. That doesn't mean home prices can't or won't follow. IF the FED keeps hiking through 2023 with no pause, I fully expect prices to decline in most markets. Specifically, home price to income in lots of markets are WAY off while others aren't too bad: https://www.bankingstrategist.com/h...erage for the U.S.,the purchase of their home.

I'd expect people to move to more affordable markets AND more expensive markets to drop in price. This isn't 2008 as of now and I'm pretty sure Powell doesn't want anything like 2008. He is simply trying to delay demand and stabilize the market.

 

[mr.h]

Just because housing sales are dropping doesn't mean housing prices will follow. There is a demand for homes and a lack of supply. Thus, transaction volume has dropped significantly but median home prices haven't followed that path. That doesn't mean home prices can't or won't follow. IF the FED keeps hiking through 2023 with no pause, I fully expect prices to decline in most markets. Specifically, home price to income in lots of markets are WAY off while others aren't too bad: https://www.bankingstrategist.com/housing-pricetoincome-ratios#:~:text=Housing Price to Income Ratios - Large Metropolitan Markets&text=The average for the U.S.,the purchase of their home.

I'd expect people to move to more affordable markets AND more expensive markets to drop in price. This isn't 2008 as of now and I'm pretty sure Powell doesn't want anything like 2008. He is simply trying to delay demand and stabilize the market.

I expect people to stay where they are and remodel or just wait for a buyers mkt. I believe that when home sales drop, prices will follow. Today’s buyers missed the boat.
IMO this will continue through 2023.
I’m moving in with ma and pa…

 

[TheEye]

:

Housing sales for 2023 is showing a significant drop. I’ll try to get the numbers to show 90’scane. We can easily see a 10% drop. You are right that some investors are going into bonds, but cash is king and investors are waiting for an entry point. Lower rate hikes are already priced in for the first half of 2023.
unfortunately earnings will suffer. Yes clusterfuq is where we are now.

I think short term bonds will mature at a good entry point. Just my gut feeling.

 

[90scane]

I expect people to stay where they are and remodel or just wait for a buyers mkt. I believe that when home sales drop, prices will follow. Today’s buyers missed the boat.
IMO this will continue through 2023.
I’m moving in with ma and pa…

Remodeling means more inflation and consumer debt.

Home sales have dropped and prices haven't in many markets. Few investors want to sell because rent inflation is happening. Few homeowners want to sell because they are locked into 2-3% rates vs 7%. Thus, demand and supply are suppressed. In some markets (Phoenix, Miami, Austin,...) we are seeing prices drop because of speculative buyers that are failing and need out BUT the majority of the US home market isn't above the 4.1x income threshold.

Today's buyers missed what boat? Low rates? If you apply the same basic rules to homes and stocks, you are going to dollar cost average. Thus, buy when you find a home you like and plan to stay in for 10+ years. When rates drop in the coming year(s), you refinance into better terms making the home even more affordable. The government just changed the requirement for seasoning to 12 months so buying now means you have to wait 12 months anyway to refinance.

Moving in with ma and pa isn't a bad thing IF they are ok with it and you can live well below your means. Most people live with tons of Envy so they send every last penny to look as cool as their friends and neighbors instead of investing in assets (stocks, bonds, real estate, etc).

 

[mr.h]

Remodeling means more inflation and consumer debt.

Home sales have dropped and prices haven't in many markets. Few investors want to sell because rent inflation is happening. Few homeowners want to sell because they are locked into 2-3% rates vs 7%. Thus, demand and supply are suppressed. In some markets (Phoenix, Miami, Austin,...) we are seeing prices drop because of speculative buyers that are failing and need out BUT the majority of the US home market isn't above the 4.1x income threshold.

Today's buyers missed what boat? Low rates? If you apply the same basic rules to homes and stocks, you are going to dollar cost average. Thus, buy when you find a home you like and plan to stay in for 10+ years. When rates drop in the coming year(s), you refinance into better terms making the home even more affordable. The government just changed the requirement for seasoning to 12 months so buying now means you have to wait 12 months anyway to refinance.

Moving in with ma and pa isn't a bad thing IF they are ok with it and you can live well below your means. Most people live with tons of Envy so they send every last penny to look as cool as their friends and neighbors instead of investing in assets (stocks, bonds, real estate, etc).

Remodeling, like putting in new flooring or cabinets are a far less cost and is less inflationary then building homes.
imo, if we continue with a couple of 25 increases and a wait and see attitude, we will see a bull market. We already hit peak inflation. I don’t think we have rate cuts in 2023.
Surveys are showing children not leaving home and that older children are moving back in. [god bless them]

 

[90scane]

Blackstone defaults on Nordic mortgage-backed bond

Blackstone Inc has defaulted on a 531 million euro ($562.5 million) bond backed by a portfolio of offices and stores owned by Finnish company Sponda Oy, as rising interest rates hit European property values.

www.reuters.com

If these pile up, Powell very well could have to pivot. The banks can only handle so many defaults before the credit markets crack. Yes, I understand this is in Finland but it does involve Citi and Morgan Stanley. The commercial side is very weak due to office space vacancies from covid.

Remodeling, like putting in new flooring or cabinets are a far less cost and is less inflationary then building homes.
imo, if we continue with a couple of 25 increases and a wait and see attitude, we will see a bull market. We already hit peak inflation. I don’t think we have rate cuts in 2023.
Surveys are showing children not leaving home and that older children are moving back in. [god bless them]

Home builders aren't starting new homes like they were 2012-2020. Most are dumping the remaining homes that were started in 2021 which is why home prices dropped. IF those inventories dry up, we very well could see an increase in demand compared to weaker supplies. Any remodeling leads to more inflation which isn't a good thing.

 

[mr.h]

Blackstone defaults on Nordic mortgage-backed bond

Blackstone Inc has defaulted on a 531 million euro ($562.5 million) bond backed by a portfolio of offices and stores owned by Finnish company Sponda Oy, as rising interest rates hit European property values.

www.reuters.com

If these pile up, Powell very well could have to pivot. The banks can only handle so many defaults before the credit markets crack. Yes, I understand this is in Finland but it does involve Citi and Morgan Stanley. The commercial side is very weak due to office space vacancies from covid.



Home builders aren't starting new homes like they were 2012-2020. Most are dumping the remaining homes that were started in 2021 which is why home prices dropped. IF those inventories dry up, we very well could see an increase in demand compared to weaker supplies. Any remodeling leads to more inflation which isn't a good thing.

I didn’t think the Fed would pivot this year, but everything is changing fast. At a certain point home/construction materials will drop significantly.
Today, ISM [non-manufacturing] numbers were strong and the mkt. popped, not being worried about inflation.

 

[Cryptical Envelopment]

@CFLCane

******* DME offering

 

[CFLCane]

@CFLCane

******* DME offering

Pretty **** terms on that PP. I figured another 4-5M was coming since they had a couple more delays but ****. At least we know for certain plant 2 is funded and in process.

 

[SpikeUM]

Just because housing sales are dropping doesn't mean housing prices will follow. There is a demand for homes and a lack of supply. Thus, transaction volume has dropped significantly but median home prices haven't followed that path. That doesn't mean home prices can't or won't follow. IF the FED keeps hiking through 2023 with no pause, I fully expect prices to decline in most markets. Specifically, home price to income in lots of markets are WAY off while others aren't too bad: https://www.bankingstrategist.com/housing-pricetoincome-ratios#:~:text=Housing Price to Income Ratios - Large Metropolitan Markets&text=The average for the U.S.,the purchase of their home.

I'd expect people to move to more affordable markets AND more expensive markets to drop in price. This isn't 2008 as of now and I'm pretty sure Powell doesn't want anything like 2008. He is simply trying to delay demand and stabilize the market.

I agree with what you wrote, but what we are seeing in Florida specifically and a bit in other Sun Belt states is that the wealthy are buying at any price, because its still way cheaper than NY, Mass, Ill, NJ, etc. or way safer than in other countries.

There was a beautiful home in my neighborhood that was bought last year and torn down, by the time they are done they will have literally paid twice what a "local" would have paid. And next door to that, the homeowner put a 50 year old house that actually does need work on the market for more than the first house sold for.

 

[SpikeUM]

I posted this in the inflation thread. This is a summary of 15 large multi family developments in 5 or 6 Sunbelt states. Low 90's is normally the standard; below that you would decrease rents, above that you would increase rents. As you can see from the below, rents will still be rising.

 

[90scane]

I agree with what you wrote, but what we are seeing in Florida specifically and a bit in other Sun Belt states is that the wealthy are buying at any price, because its still way cheaper than NY, Mass, Ill, NJ, etc. or way safer than in other countries.

There was a beautiful home in my neighborhood that was bought last year and torn down, by the time they are done they will have literally paid twice what a "local" would have paid. And next door to that, the homeowner put a 50 year old house that actually does need work on the market for more than the first house sold for.

Do you think the wealthy are going to continue that trend into 2024? If stagflation is in the cards, will the wealthy save the gun powder for other investments or are they just that well off that they can buy real estate as a hedge against inflation.

 

[SpikeUM]

Do you think the wealthy are going to continue that trend into 2024? If stagflation is in the cards, will the wealthy save the gun powder for other investments or are they just that well off that they can buy real estate as a hedge against inflation.

Impossible to tell, but in the SFH space what has driven the prices up especially in Florida and Texas are folks moving in from high tax states, and that is unlikely to change or slow down much. Its still difficult to get the attention of high end tax planners specializing in relocations.

The multi space is where folks are more hesitant to invest, but what little activity there has been, its been similar to SFH, less number of properties sold, but prices are holding up.

 

[SpikeUM]

	Florida	New York
State population	22,244,823	19,677,151
Top state income tax rate	0	10.9%
Top income tax rate in New York City and Miami	0	14.8%
State sales tax rate	6%	4%
State unemployment rate in December 2022	2.5%	4.3%
Annual state government budget (new proposals by Govs. DeSantis and Hochul)	$114.8 billion	$227 billion
Medicaid spending in fiscal year 2021	$8.95 billion ($28.76 billion with federal share)	$26.47 billion ($73.27 billion with federal share)
Medicaid recipients in December 2022	5,638,561	7,761,755
Real state GDP growth, 2016-2021, in 2012 dollars	17%	8%

WSJ Opinion based on Florida and New York data

Yet, believe it or not, Florida’s state budget as measured in the latest proposals from the two governors, is only half the size of New York’s. This is in part a reflection of their tax burden, which in Florida is much smaller. If Florida politicians want to spend more, the state’s economy has to grow more. New York’s politicians can raise income taxes, as they do with great frequency.

Florida has no state income tax, while New York’s top tax rate is 10.9%. In New York City, the top rate is 14.8%, while in Miami it’s zero. Any guess why Ken Griffin moved his Citadel hedge fund to Miami instead of New York when he was looking for an alternative to Chicago? Florida has a 6% sales tax, higher than New York’s, but New York City’s combined state and city sales tax is 8.875%.

​

Thats why over any reasonable period of time, NY (and other high tax states) will keep losing middle and upper class residents, and Florida (and others) will keep growing.

 

[mr.h]

Impossible to tell, but in the SFH space what has driven the prices up especially in Florida and Texas are folks moving in from high tax states, and that is unlikely to change or slow down much. Its still difficult to get the attention of high end tax planners specializing in relocations.

The multi space is where folks are more hesitant to invest, but what little activity there has been, its been similar to SFH, less number of properties sold, but prices are holding up.

It makes sense for individuals to move from a high tax state to a low tax state when retiring. If you are working in NY you make considerably more income and get better benefits like pensions, especially if your company is unionized. Most large companies/corporations pay little or no Federal taxes. A lot of employees do not like the policies of Texas and Florida, especially women and minorities.
Not the greatest response, but a different view.

 

[mr.h]

USD

Factory Orders (MoM)(Jan)

-1.6%

0.50

-1.8%

1.7%

Down but a little better than expected.

The Factory orders released by the US Census Bureau is a measure of the total orders of durable and non durable goods such as shipments (sales), inventories and orders at the manufacturing level which can offer insight into inflation and growth in the manufacturing

 

[Cryptical Envelopment]

Buying ADAP all am $1.30-$1.34

 

[mr.h]

Buying ADAP all am $1.30-$1.34

I just had t-cell therapy for my shoulder