THIS IS FINE

At least home prices are at all-time highs. This is fine.

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THE ONLY THING SYSTEMATIC IS THE DESTRUCTION OF AMERICA – PART 2

In Part 1 of this article I detailed the purposeful systematic destruction of global economies, with a bad flu as the catalyst, as part of a plan by the Davos elite to reconstruct the world in a manner most beneficial to these evil men and detrimental to you and me. The fight remains to be fought. Orwell’s worst fears are coming to fruition.

The masking of the masses has been, and continues to be, about despotic politicians and arrogant bureaucrats demanding obedience as a mechanism to judge their ability to shame the masses into submission. It has nothing to do with health or protecting others. The health “experts” like Fauci, the Surgeon General and CDC director actually told the truth back in March when they told everyone masks didn’t protect you from viruses. When the powers that be decided this flu needed to be hyped and blown out of all proportion, mask wearing was used as the symbol of fear necessary to panic the public into submission.

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2020 – YEAR OF LIVING DANGEROUSLY

“A shocking crime was committed on the unscrupulous initiative of few individuals, with the blessing of more, and amid the passive acquiescence of all.”

Tacitus, Publius Cornelius

Image result for 2020 crisis

The shocking crime being committed during this century under the unscrupulous initiative of a few evil men is ongoing and no longer hidden from those willing to open their eyes and see the truth. As conspiracy theorists have proven to be right through the sacrifice of Snowden, Assange, and other patriots for truth, the Deep State psychopaths have double downed and are blatantly flaunting their power and control over the levers of government, finance and media.

Never in the history of mankind have such devious, unscrupulous, arrogant, narcissistic and downright evil men seized hegemony over global finance, trade and politics. A minority of billionaire oligarchs and their highly compensated apparatchiks, ingrained in government bureaucracies, surveillance agencies and media outlets refuse to relinquish their dominance and would rather burn the world to the ground than lose their ill-gotten riches, un-Constitutional power and unlawful control.

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Housing Prices Reveals Fatal Flaw Hidden in Fed’s Monetary Policy

From Birch Gold Group

house inflation reveals fed fatal flaw

If you can’t take a dollar today and buy as much with that same dollar’s worth of stuff tomorrow, you’ve lost purchasing power. This, is a result of price inflation.

Price inflation can come in a few forms, depending on what “stuff” is affected. That “stuff” can be consumer, wholesale, wages, or in the case we’ll discuss here … assets.

Wolf Richter sheds light on one potentially fatal flaw hidden in the Fed’s “print money and enjoy the free lunch” logic of the last decade or so. He starts by highlighting “where” this flaw is currently hiding (emphasis ours):

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The Fed And The Second (Housing) Bull Run: Home Price Growth 2X Hourly Wage Growth

Via The Snake Hole Lounge

Housing is on its second leg of a bull run after the first bull run crashed and burned in 2007/2008. The growth in home prices has outstripped average hourly income since 1999.

Here is a chart comparing home price growth YoY and average hourly wage growth YoY.  Notice that is has stabilized to 2x (home prices growing twice as fast as average wage growth).

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A BIASED 2017 FORECAST (PART ONE)

“The idea that the future is unpredictable is undermined every day by the ease with which the past is explained.”Daniel Kahneman, Thinking, Fast and Slow

 

A couple weeks ago I was lucky enough to see a live one hour interview with Michael Lewis at the Annenberg Center about his new book The Undoing Project. Everyone attending the lecture received a complimentary copy of the book. Being a huge fan of Lewis after reading Liar’s Poker, Boomerang, The Big Short, Flash Boys, and Moneyball, I was interested to hear about his new project. This was a completely new direction from his financial crisis books. I wasn’t sure whether it would keep my interest, but the story of Daniel Kahneman and Amos Tversky and their research into the psychology of judgement and decision making, creating a cognitive basis for common human errors that arise from heuristics and biases, was an eye opener.

In psychology, heuristics are simple, efficient rules which people often use to form judgments and make decisions. They are mental shortcuts that usually involve focusing on one aspect of a complex problem and ignoring others. These rules work well under most circumstances, but they can lead to systematic deviations from logic, probability or rational choice theory. The resulting errors are called “cognitive biases” and many different types have been documented.

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INFLATION ABOUT TO EXPLODE HIGHER

“Those who are capable of tyranny are capable of perjury to sustain it.” ― Lysander Spooner

http://www.gloucestercitynews.net/.a/6a00d8341bf7d953ef014e8ae500da970d-320wi

We all know the BLS artificially suppresses the CPI through bullshit substitution adjustments, quality adjustments, and various other incomprehensible hedonic adjustments made by government apparatchiks at the behest of their politician bosses. Some obscure theoretical academic  calculation called owners equivalent rent accounts for almost a quarter of the CPI weighting.

It has no relation to reality as it has increased by only 12% since 2012, while the Case Shiller Housing Price Index is up 52% over the same time frame. The median price of existing home sales is up 30% over the same time frame. It also has no relation to rent increases, as they have gone up 22% nationally since 2012. It’s essentially a made up number by goal seeking bureaucrats doing the bidding of their establishment masters.

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WHAT DO WE DO NOW?

As this vitriolic, unpredictable, outrageously entertaining presidential campaign enters its final stages I find myself pondering what happens next. I was reminded of the last scene in the 1972 movie, The Candidate. The movie is about a young untested non-politician candidate for U.S. Senator in California who puts his fate in the hands of a veteran political operative and overcomes a double digit polling deficit to win a huge upset victory. His entire focus during the campaign was to win. In the final scene of the movie he is standing among the celebrating campaign staffers and the fawning press corp. with a befuddled look on his face. He grabs his political consultant campaign manager and pulls him into a room. As the press break into the room he asks, “What do we do now?” The question goes unanswered and the movie ends.

The chattering class on the boob tube is enthralled and aghast at every seizure, collapse, and deplorable comment by the two most disliked presidential candidates in U.S. history. The establishment and their corporate media mouthpieces are perplexed and irate that Donald Trump has overcome their propaganda campaign to be leading in the polls with 51 days to go. He is a non-politician who was behind by double digits in the polls a month ago. He hired professional political operatives who have molded his message, while his opponent has been lying about her health, lying about selling access while Secretary of State, and denigrating blue collar middle class Americans in campaign speeches. The momentum is clearly in his favor and absent a major gaffe during the debates he could win an unlikely come from behind victory in November.

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Core CPI Highest Since Lehman (Above Fed Mandate) As Rent, Healthcare Costs Soar

Even the world class data manipulators at the BLS can’t hide the crushing inflation impacting middle class Americans as home price soar due to Wall Street schemes, rent skyrockets because people can’t afford homes anymore, and healthcare cost are driven ever higher by the Obamacare disaster. And you wonder why the middle class is supporting Trump?
Tyler Durden's picture

“This is stagflation: the Fed is increasingly f#*ked,” exclaimed one veteran trader as Core CPI – among The Fed’s favorite inflation indicators after PCE – surged to +2.3% YoY, the highest since Sept 2008. This is the 10th month in a row above the Fed’s mandated 2% ‘stable’ growth as shelter and healthcare costs continue to surge.

Core CPI growth above Fed mandate for 10th month in a row.

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ALL TIME HIGHS

The stock market has reached new all-time highs this week, just two weeks after plunging over the BREXIT result. The bulls are exuberant as they dance on the graves of short-sellers and the purveyors of doom. This is surely proof all is well in the country and the complaints of the lowly peasants are just background noise. Record highs for the stock market must mean the economy is strong, consumers are confident, and the future is bright.

All the troubles documented by myself and all the other so called “doomers” must have dissipated under the avalanche of central banker liquidity. Printing fiat and layering more unpayable debt on top of old unpayable debt really was the solution to all our problems. I’m so relieved. I think I’ll put my life savings into Amazon and Twitter stock now that the all clear signal has been given.

Technical analysts are giving the buy signal now that we’ve broken out of a 19 month consolidation period. Since the entire stock market is driven by HFT supercomputers and Ivy League MBA geniuses who all use the same algorithm in their proprietary trading software, the lemming like behavior will likely lead to even higher prices. Lance Roberts, someone whose opinion I respect, reluctantly agrees we could see a market melt up:

“Wave 5, “market melt-ups” are the last bastion of hope for the “always bullish.” Unlike, the previous advances that were backed by improving earnings and economic growth, the final wave is pure emotion and speculation based on “hopes” of a quick fundamental recovery to justify market overvaluations. Such environments have always had rather disastrous endings and this time, will likely be no different.”

As Benjamin Graham, a wise man who would be scorned and ridiculed by today’s Ivy League educated Wall Street HFT scum, sagely noted many decades ago:

“In the short run, the market is a voting machine but in the long run, it is a weighing machine.”

Continue reading “ALL TIME HIGHS”

IT’S NOT THE BREXIT STUPID

Just over a week ago the world was coming unglued, as enough British citizens grew a pair and spit in the face of the EU establishment and global elite by voting to exit the EU. The fear mongering by central bankers and their puppet political hacks failed to deter people who have become sick and tired of being abused and pillaged by bureaucrats working on behalf of bankers and billionaires.

Stock markets around the world plummeted on Thursday and Friday. The world braced for another Black Monday. The phone lines were buzzing between central bankers around the world over the weekend as their banker constituents demanded relief. If one thing has been proven over the last seven years, its a coordinated effort between central bankers and Wall Street banks to rig the stock market higher can work over a short time period.

The titans of finance were able to once again confound short-sellers and the prophets of doom with a 5% surge from the Friday lows over the next week. It was surely a coincidence the Fed declared all Wall Street banks, safe, sound, and capable of buying back their stocks to the tune of billions early in the week.

These insolvent zombies were now free to borrow billions to buy back their overvalued stocks, destroying shareholder value, while boosting executive compensation. Poor Jamie Dimon is struggling to get by on his $27 million per year. The Wall Street banks obliged by immediately announcing multi-billion dollar buyback schemes to capitalize on the short-term trading mentality of the 30 year old MBA trading geniuses who bought the news without worrying about the actual value of the stocks they were buying.

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20 Years Of Progress? Real Median Household Income Back To 1996 Levels, Home Prices Exploding!

Guest Post by Anthony Sanders

Like Sgt Peppers Lonely Hearts Club Band,

It was twenty years ago today
Sgt. Pepper the government taught the band economy to play
They’ve been going in and out of style (not really)
But they’re guaranteed to raise a smile (but not incomes)
So may I introduce to you
The act you’ve known for all these years
Sgt. Pepper’s Lonely Hearts Club Band  Sgt. Yellen’s Flat Income Band

Yes, real median household income as of 2014 is back to 1996 levels. Not quite 20 years, but you get the point.

Unfortunately, real home prices are considerably higher than 20 years ago.

realimchp

While Bloomberg doesn’t have a real home price index, I am forced to use a nominal home price index. But you still get the point. Home prices are considerably higher as is the stock market than nearly 20 years ago. But real median household income is the same as in 1996.

rmichtoday

Yes, government policies enacted to spread the wealth and make housing affordable have seemingly backfired. American households are worse off now than (almost) 20 years ago.

And, of course, The Federal Reserve has made asset prices skyrocket, but not real median household income.

beatles 5


LIES, LIES AND OMG, MORE LIES

It’s that time of year again. It’s open enrollment for health plans at my employer. They are biggest employer in Philly and have the most leverage possible with the insurance companies. They have such good leverage that my premiums are going up “only” 9.8% this year for a basic HMO plan. Based on what I hear from others, I should be thankful for just a 9.8% increase.

This isn’t a new development. Since I’ve been tracking all my expenditures using Quicken since 1991, I know exactly what my annual health insurance costs have been every year. Obamacare was passed in 2009 and began to be implemented in 2010. Obama declared that families could expect $2,500 of savings per year. I know for a fact my annual medical expenses were $2,000 higher in 2015 than they were in 2010.

Continue reading “LIES, LIES AND OMG, MORE LIES”

Chart of the Day- Thanks Fed For Helping The Average Guy

In March of 2005, 52,000 new homes were sold at prices of less than $200,000. At the bottom of the crash in March 2009 that number had dropped to 14,000. The Fed instituted ZIRP and QE around that time. Sales of homes under $200,000 totaled 9,000 units in March. With sharp price rises builders have found it more profitable to build fewer but more expensive homes than selling more lower priced homes where profit margins have all but disappeared.

The Fed has promoted this distortion by enabling builders to finance their construction and holding costs of inventories at zero in real terms. Capture


A CRISIS IN AMERICAN HOUSING

Guest Post by Dr. Housing Bubble

Americans are realizing something is wrong with the system.  You can see it this year with the rise of outsiders in both political parties.  People realize the system is rigged.  Instead of some folks that kowtow and simply move forward like subservient lemmings, millions are mobilizing and taking action.  Many are voting with their wallets.  The number of renter households has increased by 10 million over the last decade while net homeowners has been stagnant.  The bailouts were supposed to help American families but what happened is that many were kicked out of their homes (for missing payments) and then giving them to banks that also missed much larger payments (too big to fail).  People got a quick education on how things work.  This is why the homeownership rate fell dramatically yet somehow, homes sold to investors and now rents are at all-time highs while incomes are stuck in neutral.  This is a major problem and people are taking notice.

A crisis in American housing

Zillow has some really good research on the topic.  You would think that rising home prices and rising rents would be a sign of more families buying.  Yet it is more of a sign of continued manipulation in the market.  It is also a sign of outside money, either from big investors, Wall Street, or foreign money pushing up values and crowding out regular families from buying.  The Fed has set the stage.  By creating a low interest rate environment, big pools of money are hungry for yield in nearly any sector.

First take a look at home prices:

home price index

Source:  Zillow

The trend is clear and at least in the short-term, prices seem to nearing a plateau.  It is certainly being reflected in rents:

rent index

Continue reading “A CRISIS IN AMERICAN HOUSING”

THE FED CAN’T FIND INFLATION ANYWHERE

The lying pricks at the Federal Reserve give speech after speech about no inflation, keeping rates low, and even blathering about negative interest rates. I guess these idiots don’t need to drive cars, eat food, pay rent, buy houses, or essentially live in the real world. Gas prices are up 22% since mid-February. Food prices are up 6% since early January. Rent has been ratcheting higher at a 4% annual rate for awhile. Home prices have been going up 5% to 10%. Various government taxes, fees and tolls have been accelerating at a 5% to 10% pace. And Yellen can’t find any inflation????

Via Anthony Sanders

CRB Foodstuff Index UP 6% Since Jan 4th (24% Annualized) – It’s Beginning To Look A Lot Like Inflation

It’s beginning to look a lot like inflation.

The Commodity Research Board’s Foodstuff index is up 6% since January 4, 2016. That is just in a little over 3 months. That translates to just under 24% growth on an annualized basis.

foodinf

With US Real Average Weekly Earnings 1982-1984 USD YoY at 0.7%, it really does feel like inflation. Although The Federal Reserve thinks inflation is just shy of 2%.

realweeklyee

When The Federal Reserve conducts their closed meeting today (and meets with President Obama), I certainly hope it is to discuss rising food prices and NOT negative interest rates!

santayellena