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Experts Address Inflation Fears During RISMedia Panel

An ongoing and historic rise in inflation has shaken not just the real estate industry, but has affected nearly every business and consumer across the country. With December’s Consumer Price Index (CPI) topping 7% year-over-year—the largest increase since 1982—real estate professionals are asking just how profound the impacts will be on their clients and markets. […] The post Experts Address Inflation Fears During RISMedia Panel appeared first on RISMedia. An ongoing and historic rise in inflation has shaken not just the real estate industry, but has affected nearly every business and consumer across the country. With December’s Consumer Price Index (CPI) topping 7% year-over-year—the largest increase since 1982—real estate professionals are asking just how profound the impacts will be on their clients and markets. At RISMedia’s Real Estate Rocking in the New Year virtual event earlier this month, some of the industry’s most respected and influential minds came together to break down the potential for disruption, likely future trends, and actionable steps to take for real estate brokers in the face of these alarming numbers. “I think in 2022 we’re still going to see a really robust market once again. I’m very optimistic about it,” said Joan Docktor, president of Berkshire Hathaway HomeServices Fox & Roach. Even with mortgage rates already ticking up and likely to increase further this year, Docktor and the other expert panelists broadly agreed that demand for homes would not be significantly hampered and home prices would continue to appreciate. On the other hand, Scott MacDonald, broker/owner of RE/MAX Gateway said that inflation has pushed the cost of new home construction to dizzying heights, with building materials still seeing costs climb 500% and that could push some out of the market. “You’re going to see all these costs passed over to consumers as a result of that,” he warned. “People are going to get more concerned about how they’re spending money, and it’s going to be a challenging time for consumers and for purchasers of new homes.” But for anyone who can afford a home should not be discouraged, he added, as home price appreciation has always been a good hedge against long-term inflation. Sarah Richardson, CEO & founder of TruRealty, pointed out that rising rents are going to push more people to buy despite continued low inventory and inflationary pressures. “Consumer confidence is very strong, I think it’s going to remain very strong, but we could probably use a little bit more inventory to help some of those buyers fulfill their dreams in becoming a homeowner,” she said. That lack of inventory is affecting everyone, the panelists said, and there is no quick solution to that. But Docktor posited that prices might “taper off” once inventory opens up as more normalcy returns to life and people have babies, get married and change jobs, resulting in more existing home sales. Panel moderator Dan Kruse, CEO/president of Century 21 Affiliated said he has heard concerns that the number of home sales overall would drop in 2022 in response to inflation and continued low inventory—a question that has seen disagreement from experts so far. As the “sticker shock” of inflation wears off, though, Richardson said she looks at the macroeconomic fundamentals continuing to indicate continued strength in the real estate market. “I still think people are making more money, there are jobs out there. The economy is really, really strong, so 2022 is still going to remain strong. I think we’re still going to remain a seller’s market,” she predicted. As far as what real estate business owners need to do in the face of these still-unprecedented times, MacDonald said that educating agents will be the most important step to take as both consumers and real estate professionals encounter confusing and often conflicting information about inflation and markets. That includes the kind of national expert commentary and predictions provided by the panel, as well as hyperlocal market info about open house traffic, offers and home sales. “Being ahead of the game and being up to date with the trends is something we need to have our agents know, so they can take that information that we provide them, to share with the clients,” MacDonald said. “Getting that information and relaying it out to your agents is critical.” For business owners trying to save money this year, Docktor said that having agents in the office less—something that was already a trend in real estate before the pandemic—gives business owners an opportunity to find efficiencies with hybrid work models, balancing culture with flexibility. Consolidating smaller offices is even an option, she added, which can also create new synergies for back-office operations and infrastructure. “You really need to study the market, study what your agents want, make sure you are able to give that to them,” she said. “Make sure that you have the space that they need, but you don’t have that overflow of space that you don’t need because space and employees are your most expensive costs.” An overall positive outlook on 2022’s possibilities in the face of inflation, however, should have real estate business owners pushing forward rather than pulling back, according to Kruse, as short term worries and uncertainty are very likely to morph into another big year for real estate. “We’re all looking at the industry and saying there’s a positive time ahead of us and what 2022 has in store,” Kruse said. Missed the event? Replays including every panel and expert interview are available here. Jesse Williams is RISMedia’s associate online editor. Email him your real estate news ideas to jwilliams@rismedia.com. The post Experts Address Inflation Fears During RISMedia Panel appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 14th, 2022

NAR 2022 Forecast Focuses on Inventory, Affordability and Equity

With one spectacularly unique year coming to a close and the start of a particularly uncertain year looming, the National Association of REALTORS® (NAR) held a virtual Forecast Summit bringing together a swath of experts to hopefully provide both perspective on the wild ride of 2021 while shining a light on the opportunities and challenges […] The post NAR 2022 Forecast Focuses on Inventory, Affordability and Equity appeared first on RISMedia. With one spectacularly unique year coming to a close and the start of a particularly uncertain year looming, the National Association of REALTORS® (NAR) held a virtual Forecast Summit bringing together a swath of experts to hopefully provide both perspective on the wild ride of 2021 while shining a light on the opportunities and challenges of 2022. Featuring insights from dozens of economists and industry insiders, NAR Chief Economist Dr. Lawrence Yun and Vice President of Demographics and Behavioral Insights, Dr. Jessica Lautz, led discussions and presentations looking at data, projections and insights on everything from long-term demographic-driven trends to current federal legislation to racial gaps in equity and homeownership. “2021 has certainly been a year unlike any other—what will 2022 bring?” asked new NAR President Leslie Rouda-Smith. “We are here today to look into the future. We don’t have a crystal ball, but much of the success REALTORS® had in 2021 was due to insight.” In the shadow of rocketing inflation and a housing market that was severely restricted by supply-side limitations, the speakers quickly highlighted the top-line concerns that real estate professionals should be looking at next year. “One thing we already know about next year is our country’s inventory shortage and the resulting affordability crisis will still be acute,” Rouda-Smith said. According to Todd Richardson, who heads up the research division of the federal office of the United States Department of Housing and Urban Development (HUD), the country is between 5 to 6.8 million housing units short going into 2022, many of them concentrated in the affordable housing sector. “The pandemic has made that problem worse,” Richardson said. “To solve that requires innovation and out-of the-box thinking. It also requires knowing what is going on.” Other high-level predictions from Yun and other economists surveyed included home prices rising around 5% and mortgage rates climbing to around 3.7% by the end of the 2022, along with unemployment falling only slightly from the rate of 4.2% it sits at now. For this last metric, though, Yun warned that many states still are well below the number of jobs they had pre-pandemic as people have dropped out of the workforce, meaning some of the optimism coming out of those broad unemployment numbers could be misleading. Richardson and others spent some time speaking about programs in the currently proposed Build Back Better bill, which remains jammed up in the Senate. Billions of dollars for first-time homebuyer support, the Low Income Housing Tax Credit, zoning reform and rental housing vouchers could all help alleviate these pressures, according to Richardson and several of the other experts. “There’s a lot of regulatory changes and movement happening and I would encourage REALTORS® to be a part of that,” said Andre Perry, a fellow at the Brookings Institute. Discussion of the Build Back Better housing programs—which NAR and numerous other housing advocacy organizations have zealously lobbied for—sparked a lively political discussion in the virtual chat, which was locked early on in the panel. Ken Johnson, a former real estate broker and professor at Florida Atlantic University, was less optimistic about price growth. “I do think some markets are significantly overpriced at this time, but most are not as overpriced as they were 15 years ago. So we’re going to get a mixed bag result,” he said. The effect around the country will not be uniform.” Johnson highlighted Miami, Florida, as a metro with relatively accurate price growth by underlying measures, while calling out Detroit, Michigan, as an area that was likely overvalued in the medium- to long-term. As far as regions, Yun also highlighted ten “hidden gems” where he expected a hot market in 2022, with nearly every single one of these areas in the South. These towns were centered on Fayetteville, Arkansas; Knoxville, Tennessee; Spartanburg, South Carolina; Dallas-Ft. Worth, Texas; Huntsville, Alabama; Daphne, Alabama; San Antonio, Texas; Tucson, Arizona; Pensacola, Florida; and Palm Bay, Florida. The Big Challenges A number of panelists, ranging from government officials to academics, emphasized that without significant regulatory shifts, as far as zoning and funding, there is no realistic way to overcome an inventory and affordability crisis that has been accelerated by the pandemic. “For those REALTORS® who live in expensive coastal cities, we are on an unsustainable track as far as housing price appreciation,” said Issi Romem, a fellow at the UC Berkeley Terner Center for Housing Innovation. “Densify, do not revert to sprawling…that needs to be allowed to happen. You gotta remind people.” The kind of restrictive zoning that swallows up big tracts of land and prevents any kind of dense building, which is most prevalent in coastal markets, will have to be modified to keep a healthy housing market according to economists and other panelists who spoke. Romen urged REALTORS® to “sympathize” with the ongoing movement to diversify zoning, “even if you don’t like seeing your neighbors get a second story window that can look into your backyard.” “It’s for the greater good,” he said. Because a large portion of jobs will still require or encourage people to live physically close to an office or other location (Romem said most metros will have around 30% remote offerings for their labor force), even cities like San Francisco will have to expand housing offerings or end up with “Manhattanization,” where only the ultra-rich can afford to buy anything. Racial equity was another big topic, with Perry citing a study he had led in 2018 that showed homes of similar qualities in Black neighborhoods are valued 23% less than other neighborhoods, costing Black homeowners $156 billion cumulatively. Despite this, federal legislation and other trends during the pandemic have given opportunities to address this, according to Perry. “We saw a spike among Black millennials, particularly Black women, purchasing homes,” he said. “People were able to save more, people were not using their discretionary income for bars and clothing and such.” A pause on student loan payments was also helpful, he added, but a lack of intergenerational wealth continues to hamper prospective Black homebuyers. Other large term demographic trends that will affect real estate include a huge drop in the birth rate and marriage rate, according to Lautz. In 2021, 31% of households had a child in the home, compared to 58% today. This so-called “baby bust” could have extremely broad implications for the real estate market, with families less likely to move, upsize, downsize or renovate based on the life stage of their children. “All those factors are removed,” she said. At the same time, prospective buyers still are very much interested in having a real estate agent “who they trust, is honest and will help them navigate” the home-buying process, according to Lautz, with a survey showing 87% of potential buyers would prefer to have an agent of their own rather than work with a seller directly or a builder. iBuyers were “a statistical 0” as far as that data, according to Lautz. Jesse Williams is RISMedia’s associate online editor. Email him your real estate news ideas to jwilliams@rismedia.com. The post NAR 2022 Forecast Focuses on Inventory, Affordability and Equity appeared first on RISMedia......»»

Category: realestateSource: rismediaDec 17th, 2021

Year-End Outlook: Climbing Mortgage Rates Strain Buying Power in 2022

Editor’s Note: RISMedia’s Year-End Outlook series provides an in-depth analysis of the housing market’s leading indicators for economic health, and showcases expert insights on what’s to come in 2022.  Homeowners will likely look at the past year of mortgage rate performance with fondness or even regret as the days of historic lows fade. Based on […] The post Year-End Outlook: Climbing Mortgage Rates Strain Buying Power in 2022 appeared first on RISMedia. Editor’s Note: RISMedia’s Year-End Outlook series provides an in-depth analysis of the housing market’s leading indicators for economic health, and showcases expert insights on what’s to come in 2022.  Homeowners will likely look at the past year of mortgage rate performance with fondness or even regret as the days of historic lows fade. Based on recent Freddie Mac reports, 30-year fixed-rate mortgages (FRM) at 3.14%, are breaking from months of sub-3% lows that captured headlines throughout 2021. Economists and real estate experts agree that recent upticks in rates mark an inevitable trend that is likely to last well into the next year as the housing market heads toward its post-pandemic equilibrium. “We expect a somewhat gradual increase throughout the rest of this year and going into 2022,” says Joel Kan, chief economist at the Mortgage Bankers Association (MBA), which expects rates to climb gradually to nearly 4% by the end of next year. While that serves as the highest prediction compared to other reports, that isn’t far off from the consensus that rates will fall somewhere between the mid-to high-three percentile by the close of next year. Kan attributes that forecast mainly to the relatively strong economic recovery that the nation has experienced since the outbreak of COVID-19 in March 2020. Another factor contributing to the upward pressure on mortgage rates comes from the Fed, and their plans to address higher inflation by tapering asset purchases, according to experts from the National Association of REALTORS® (NAR). “The Federal Reserve is getting nervous about rising and persistently high inflation rates,” says Lawrence Yun, NAR chief economist. “Therefore, the Fed will be tapering the purchases of mortgage-backed securities later this year and raising short-term interest rates in 2022.” Market Implications The impacts of higher mortgage rates have been discussed at length among real estate pundits and stakeholders that have raised concerns that higher rates would pause market activity. Yun admits that higher rates will shave home sales modestly, but he doesn’t think it will be drastic. His colleagues echoed similar sentiments, but also note that higher rates will play a larger part in persisting affordability challenges. “Typically, we say that an increase in rates, at least if it’s not too severe, doesn’t tend to impact demand quite as much because if someone is looking to buy a home, interest rates and mortgage rates are one part of the equation,” Kan says, pointing to record-level home price appreciation as another factor straining buyers. As mortgage rates ascend, Kan also indicates that refinancing activity will likely take a substantial hit, dropping by more than 60% in 2022. “We’ve been in this lower rate environment for the last year and a half, and we’ve seen a lot of refinances,” he says, noting that 2020 was a banner year for mortgage originations and refinancing under record low rates that lasted well into 2021. Matthew Gardner, the chief economist at Seattle-based Windermere Real Estate, says higher rates could also discourage some would-be buyers that have grown accustomed to the “artificially low mortgage rates” of the past year and a half. “One of the biggest things regarding the increase in rates is that they certainly will act as a headwind to home-price growth,” says Gardner. He explains that for every 1% point increase in rates, that buying power for consumers declines by roughly 10%. However, despite the increase in rates, Gardner doesn’t see a cause for concern in the market, which he suggests will remain competitive with a persisting supply-demand gap as mortgage rates are still relatively low, when compared to previous years. Historically, Gardner says the long-term average for mortgage rates since the 30-year FRM was established has been around 7.5%, with the last peak of 4.87% occurring in November 2018. “It is still remarkably low when you consider it in the bigger picture,” Gardner says. Buyer Behavior  Considering the prognosis for mortgage rate increases in 2022, real estate brokers and leaders have mixed feelings about how buyers are likely to react in the cooling market with additional strain affordability. In Austin, Texas, Buddy Shilling, president of the Austin Divisions of JBGoodwin REALTORS®, says an increase in rates isn’t likely to harm his activity in the coveted area, which has seen an increase in significant employers migrating into the Texas city. “If the rate climbs, Austin is in a good position because many of the new jobs being created in the city are higher-paying ones,” Shilling says, adding that an abundance of developable land and affordable home options will continue to make the Texas city a desirable destination for buyers. “Even if the interest rate goes up, less expensive, affordable homes will be available just a few minutes away,” Shilling adds. Lynn Chute, vice president of HomeSmart Realty’s office in Denver, Colorado, expects rising rates to create some buyer hesitation in her market. However, she says the pause in buying will be short-lived, with still relatively low rates up for grabs. “Buyers will need to make some adjustments, but the ultimate goal of homeownership is still well within reach,” Chute says. “With the drastic increase in rental rates, the benefits of homeownership still outweigh the cost of renting, even with a small rate increase. Buying a home continues to be one of the best long-term investments you can make.” A similar point was raised in a recent interview and panel virtual panel discussion conducted by CNN that featured real estate leaders offering their market predictions. The interview featured Barbara Corcoran, founder of Corcoran Real Estate. The subsequent panelists were Glenn Kelman, CEO of Redfin; David Doctorow, CEO of realtor.com®; and Ryan Williams, founder and CEO of Cadre. Corcoran noted during her interview that rising mortgage rates would add to affordability issues that are already straining the market and squeezing buyers out. “When you do the math on what you pay for your monthly expenses on a house with a 1% increase in mortgage rates, it’s substantial,” she said, noting that aspiring buyers waiting to enter the market may be at risk of being left behind as overall living expenses increase. When asked if she thought rising rates would dissuade people who have gotten used to low rates, Corcoran said, “I don’t think there is cause for panic.” “I don’t think any financial expert is predicting that rates are going to spike,” she said while also opining on the Fed’s plan to incrementally increase interest rates and the potential implications to mortgage rates. “It’s in everyone’s interest to keep the housing market going, so I think that you’re going to find that the bureaucrats are going to be extremely cautious on raising rates, but they will raise rates, but I don’t think the climb will be fast and furious,” Corcoran said. Doctorow agreed with Corcoran’s sentiments, stating, “As consumers think about affordability, it’s really important to understand the two factors—the price of the home and the mortgage rates—together and ultimately try to put themselves in a position to get the most home that they can knowing that interest rates may edge up over time,” Doctorow added. Jordan Grice is RISMedia’s associate online editor. Email him your real estate news to jgrice@rismedia.com. The post Year-End Outlook: Climbing Mortgage Rates Strain Buying Power in 2022 appeared first on RISMedia......»»

Category: realestateSource: rismediaNov 3rd, 2021

Experts Address Inflation Fears During RISMedia Panel

An ongoing and historic rise in inflation has shaken not just the real estate industry, but has affected nearly every business and consumer across the country. With December’s Consumer Price Index (CPI) topping 7% year-over-year—the largest increase since 1982—real estate professionals are asking just how profound the impacts will be on their clients and markets. […] The post Experts Address Inflation Fears During RISMedia Panel appeared first on RISMedia. An ongoing and historic rise in inflation has shaken not just the real estate industry, but has affected nearly every business and consumer across the country. With December’s Consumer Price Index (CPI) topping 7% year-over-year—the largest increase since 1982—real estate professionals are asking just how profound the impacts will be on their clients and markets. At RISMedia’s Real Estate Rocking in the New Year virtual event earlier this month, some of the industry’s most respected and influential minds came together to break down the potential for disruption, likely future trends, and actionable steps to take for real estate brokers in the face of these alarming numbers. “I think in 2022 we’re still going to see a really robust market once again. I’m very optimistic about it,” said Joan Docktor, president of Berkshire Hathaway HomeServices Fox & Roach. Even with mortgage rates already ticking up and likely to increase further this year, Docktor and the other expert panelists broadly agreed that demand for homes would not be significantly hampered and home prices would continue to appreciate. On the other hand, Scott MacDonald, broker/owner of RE/MAX Gateway said that inflation has pushed the cost of new home construction to dizzying heights, with building materials still seeing costs climb 500% and that could push some out of the market. “You’re going to see all these costs passed over to consumers as a result of that,” he warned. “People are going to get more concerned about how they’re spending money, and it’s going to be a challenging time for consumers and for purchasers of new homes.” But for anyone who can afford a home should not be discouraged, he added, as home price appreciation has always been a good hedge against long-term inflation. Sarah Richardson, CEO & founder of TruRealty, pointed out that rising rents are going to push more people to buy despite continued low inventory and inflationary pressures. “Consumer confidence is very strong, I think it’s going to remain very strong, but we could probably use a little bit more inventory to help some of those buyers fulfill their dreams in becoming a homeowner,” she said. That lack of inventory is affecting everyone, the panelists said, and there is no quick solution to that. But Docktor posited that prices might “taper off” once inventory opens up as more normalcy returns to life and people have babies, get married and change jobs, resulting in more existing home sales. Panel moderator Dan Kruse, CEO/president of Century 21 Affiliated said he has heard concerns that the number of home sales overall would drop in 2022 in response to inflation and continued low inventory—a question that has seen disagreement from experts so far. As the “sticker shock” of inflation wears off, though, Richardson said she looks at the macroeconomic fundamentals continuing to indicate continued strength in the real estate market. “I still think people are making more money, there are jobs out there. The economy is really, really strong, so 2022 is still going to remain strong. I think we’re still going to remain a seller’s market,” she predicted. As far as what real estate business owners need to do in the face of these still-unprecedented times, MacDonald said that educating agents will be the most important step to take as both consumers and real estate professionals encounter confusing and often conflicting information about inflation and markets. That includes the kind of national expert commentary and predictions provided by the panel, as well as hyperlocal market info about open house traffic, offers and home sales. “Being ahead of the game and being up to date with the trends is something we need to have our agents know, so they can take that information that we provide them, to share with the clients,” MacDonald said. “Getting that information and relaying it out to your agents is critical.” For business owners trying to save money this year, Docktor said that having agents in the office less—something that was already a trend in real estate before the pandemic—gives business owners an opportunity to find efficiencies with hybrid work models, balancing culture with flexibility. Consolidating smaller offices is even an option, she added, which can also create new synergies for back-office operations and infrastructure. “You really need to study the market, study what your agents want, make sure you are able to give that to them,” she said. “Make sure that you have the space that they need, but you don’t have that overflow of space that you don’t need because space and employees are your most expensive costs.” An overall positive outlook on 2022’s possibilities in the face of inflation, however, should have real estate business owners pushing forward rather than pulling back, according to Kruse, as short term worries and uncertainty are very likely to morph into another big year for real estate. “We’re all looking at the industry and saying there’s a positive time ahead of us and what 2022 has in store,” Kruse said. Missed the event? Replays including every panel and expert interview are available here. Jesse Williams is RISMedia’s associate online editor. Email him your real estate news ideas to jwilliams@rismedia.com. The post Experts Address Inflation Fears During RISMedia Panel appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 14th, 2022

Inflation Continues to Soar in November, Up 6.8% This Year

The consumer price index (CPI) jumped 0.8% in November, according to a new report from the federal Bureau of Labor Statistics, pushing overall inflation to a nearly 40-year high at 6.8% as supply chain struggles and surging demand has sent the price of consumer goods spiraling upward. So-called core inflation, which does not include more […] The post Inflation Continues to Soar in November, Up 6.8% This Year appeared first on RISMedia. The consumer price index (CPI) jumped 0.8% in November, according to a new report from the federal Bureau of Labor Statistics, pushing overall inflation to a nearly 40-year high at 6.8% as supply chain struggles and surging demand has sent the price of consumer goods spiraling upward. So-called core inflation, which does not include more volatile food and energy prices, was up 0.5% in November, reaching 4.9% over the last 12 months. Much of the core inflation increase was driven by vehicle prices, with the cost of new vehicles rising 1.1% and used vehicles jumping 2.5% last month. Energy costs overall rose 3.5%, less than the 4.8% increase seen in October but still pushing that sector to 33% higher over the last year. Gasoline moved up 6.1% in November—the same as the previous month and up nearly 60% from this time last year. Food prices were up 0.7% in November after rising 0.9% in October, now 6.1% up annually. Yesterday, Director of the National Economic Council Brian Deese said at a press conference that there has been some positive movement on inflation that is not reflected in these numbers. Most economists have continued to predict inflation will peak over the next few months before tapering off, though the Federal Reserve has indicated that it is more worried about the metric now than it was a few months ago. According to Deese, gasoline prices actually fell about nine cents over the last couple weeks, and natural gas prices dropped 25% in November. Deese also claimed that used cars, pork and wheat have all come down recently, with those decreases not reflected in the most recent CPI report. “Consensus estimates of outside experts continue to forecast and project that price increases will moderate going into 2022,” he said, adding that the Biden administration would “redouble our efforts” to address short and medium-term inflation. Deese did not directly answer a question regarding whether “the wave is cresting” for inflation, instead pointing to a positive job market and the broader economic recovery. National Association of REALTORS® Chief Economist Lawrence Yun said in a statement this morning that real estate remains a good investment during periods of high inflation while also acknowledging higher heating bills and the potential for mortgage rate increases. “Even when interest rates soared in the 1980s and thereby crushed home sales, home prices still held up to consumer price inflation: 5.5% versus 5.6%,” Yun pointed out. “Other decades also show similar patterns. Therefore, for those concerned about the loss in purchasing power of money and savings, be assured that real estate has proven to be a good hedge against inflation.” Inflation has remained a significant concern both among policymakers and the public at large, as people have seen significant cost increases at the gas pump, in the grocery store and in their energy bills. President Joe Biden has emphasized that the issue is a global problem but called it a “top priority” for his administration in a statement last month. Fed chair Jerome Powell has said recently that several factors, including this high level of inflation and plummeting unemployment has pushed the central bank to consider accelerating its tapering of bond purchases, which were meant to prop up the broader economy during the pandemic. Powell has also left open the possibility of raising interest rates, predicating that decision both on inflation and so-called “maximum employment,” though that metric can be difficult to define especially due to unprecedented shifts in the labor market. Powell recently told the Senate Banking Committee at a hearing that inflation numbers would likely reach the bank’s metrics to precipitate an interest rate hike “in the coming months.” He has also indicated that the Fed will stop using the term “transitory” to refer to inflation, but claiming that decision is more based on disparate interpretations of the word rather than a shift in policy. Jesse Williams is RISMedia’s associate online editor. Email him your real estate news ideas to jwilliams@rismedia.com. The post Inflation Continues to Soar in November, Up 6.8% This Year appeared first on RISMedia......»»

Category: realestateSource: rismediaDec 10th, 2021

The Fed Admits It Has Lost Control

The Fed Admits It Has Lost Control Submitted by QTR's Fringe Finance Like any junkie with an addiction, the first step is admitting that you have a problem. It was no sooner than Paul Krugman came out less than two months ago declaring a win for what he called “Team Transitory” that Jerome Powell sat in front of a Senate panel and was forced to admit he had a problem. Powell seemed to come to terms yesterday that he was stuck between a rock (brutal, unrelenting consumer inflation) and a hard place (the inability to raise rates or taper without fuck-tangling the entire economy and capital markets). The Fed Chair admitted in front of a Senate panel yesterday that “it’s probably a good time to retire” the word “transitory” to describe inflation. He continued: “At this point, the economy is very strong and inflationary pressures are higher, and it is therefore appropriate in my view to consider wrapping up the taper of our asset purchases, which we actually announced at the November meeting, perhaps a few months sooner,” according to CNBC. Of course, to those of us without our heads up our asses over the last 18 months, like Jerome Powell, this admission doesn’t come as that much of a surprise. I have been covering, writing and ranting [here, here, here and here] about why I believed it was obvious that the inflation we’re experiencing is not transitory, for months now. In fact, I would argue that the extent of the coming inflation problem has been pretty obvious to just about anybody. This makes it extra hilarious that the Fed has been hiding behind this vaudeville act of pretending they just noticed that inflation has barely nudged above their 2% target. The reality is that price hikes for the everyday American are 10%, 20%, sometimes up to 50% on products and services they need for their day-to-day lives. In addition to what we can experience with our very own eyes and wallets, every single major consumer products manufacturer and industrial company has commented that their cost of raw materials has gone up. The American public has been so aware of inflation, it has even become a part of the mainstream media narrative on both the left and the right. Photo: The Counter SignalInflation has been out of control for years now: you know it, and now nobody can say that the Fed doesn’t know it. In addition to relinquishing the “transitory” term yesterday, Powell even indicated to the Senate panel that accelerating their taper and considering rate hikes were on the table. This is especially bold language in the face of the newly-discovered omicron variant, which I predicted days ago would give the Fed a perfect excuse if they wanted to to continue quantitative easing. While I happen to think this will be the Delta variant part 2 (in that it drums up a lot of hysteria and then everyone eventually ignores it), that doesn’t mean the government and markets won’t overreact to the news. Remember, scary sounding words like “mutation”, “spike protein” and “variant” are a prompt to act like hysterical hyenas and usurp power unilaterally for those on the left side of the aisle (read: our entire government right now). But based on Powell’s testimony yesterday, it looks like the problem of high prices is going to take precedence over using omicron as another crutch to push a socialist modern monetary theory agenda - at least for the time being. And while uncertainty surrounding omicron is part of the discussion, markets plunged on Tuesday of this week mainly because of the verbiage Powell used when describing the taper and potential rate hikes, in my opinion. The only question now is whether Powell has the stones to stand by his hawkishness. If the Fed does look to accelerate the taper and toss around the idea of rate hikes in order to try and rope inflation in, as indicated, I think we can expect further downside in equity markets in December, as I predicted about a week ago. In fact, Powell doesn’t even have to re-acknowledge what he said yesterday, he simply has to say nothing until the Fed’s next official nod to the markets. That isn’t to say that his taper/rate hike plan is or isn’t going to work. It’s only to say that it will introduce a significant amount of volatility to markets that hasn’t been there over the last year and a half. In other words, if your strategy is like that Target manager that made a million dollars shorting the VIX 2018, it might be a great time to take a month off. In a volatile situation, I would expect small caps and technology to get hit the hardest, with some rotation into blue chips, staples and Dow Industrials, although these three areas of respite may eventually wind up lower as well. From there, it’s going to be a question of how inflation responds and how much leeway the market gives the Fed before fear of an impending credit catastrophe starts to spread. Photo: NY TimesOf course, the newfound hawkishness also leaves Powell room to backtrack - something that the Fed loves to do and are experts in - by slowing the taper or pushing rate hikes back further. At least for now, however, the market appears to have started to take its medicine due to Powell’s change of stance. As of today, the omicron variant doesn’t look like it’s going to have a material effect on the Covid universe. That is, except for the effect our overreaching government wants to cause themselves. While most indications over the last 72 hours have been that omicron isn’t more deadly than other variants, the government doesn’t seem to care and has already sought out new restrictions that will once again throw a wrench in the gears of business, industry and people’s daily lives. Creating a problem where there isn’t one: it’s the Keynesian Government’s way. Precious metals were higher on the day yesterday before Powell’s testimony, when they shifted drastically lower on expectations of hawkish policy. An interesting setup for gold here is that it may actually transition from being an inflationary hedge to just a hedge for market volatility and systemic risk. If we start to try and redline a taper or rate hikes and the economy or credit markets start to get really volatile, gold may be still seen as a safe haven, despite the fact that the clear and present worry wouldn’t necessarily be inflation at the time. I think this is why my friend Rosemont Seneca wants to own it heading into 2022. But of course there’s also many of the school that believe inflation is coming no matter what the outcome over the next several months is. Many believe that the Fed won’t be able to raise rates because they won’t be able to service the national debt or do so without creating a credit crisis. Ergo, the only option is then to try to print their way out of the corner they have painted themselves in. I think both of these scenarios act as a tailwind for gold. I also think commodities may still be in play as demand fears from omicron will eventually fade away, in my opinion. Omicron will, in my opinion, go the way of the Delta variant, in that it’ll be a great new scary sounding headline for people in the liberal media to push, but the everyday person isn’t going to give a shit about it. What is important here is that it truly looks like the Fed is trying to shift gears. It looks like we’re heading into a new era as we move into December and into 2022. I had a feeling this type of volatility would be on its way heading into the end of the year because the Fed has painted itself into a very difficult corner to get out of. While I don’t think they have done anything productive in terms of bringing new solutions to the inflation problem to the table, they have at least acknowledged the fact that they have lost control. Yesterday may only be the beginning of the every day investor realizing not just that there’s an inflation problem, but more importantly that we may not have the solution for it. *  *  * Zerohedge readers always get 10% off a subscription to my blog for life by using this link. DISCLAIMER:  It should be assumed I have positions in any security or commodity mentioned in this article and could benefit from my analysis proving correct. None of this is a solicitation to buy or sell securities. None of this is financial advice. Positions can always change immediately as soon as I publish, with or without notice. You are on your own. Do not make decisions based on my blog. I exist on the fringe. The publisher does not guarantee the accuracy or completeness of the information provided in this page. These are not the opinions of any of my employers, partners, or associates. I get shit wrong a lot.  Tyler Durden Thu, 12/02/2021 - 11:40.....»»

Category: smallbizSource: nytDec 2nd, 2021

Risk Cracks After Moderna CEO Comments Spark Global Stock Rout

Risk Cracks After Moderna CEO Comments Spark Global Stock Rout Ask a drug dealer if methadone helps cure a cocaine addition and - shockingly - you will hear that the answer is "hell no", after all an affirmative response would mean the fixer needs to get a real job. Just as shocking was the "admission" of Moderna CEO, Stéphane Bancel, who in the latest stop on his media whirlwind tour of the past 48 hours gave the FT an interview in which he predicted that existing vaccines will be much less effective at tackling Omicron than earlier strains of coronavirus and warned it would take months before pharmaceutical companies could manufacture new variant-specific jabs at scale. “There is no world, I think, where [the effectiveness] is the same level . . . we had with [the] Delta [variant],” Bancel told the Financial Times, claiming that the high number of Omicron mutations on the spike protein, which the virus uses to infect human cells, and the rapid spread of the variant in South Africa suggested that the current crop of vaccines may need to be modified next year. Here, the self-serving CEO whose sell-mode was fully engaged - after all what else would the maker of a vaccine for covid say than "yes, the world will need more of my product" - completely ignored the earlier comments from Barry Schoub, chairman of South Afruca's Ministerial Advisory Committee on Vaccines, who over the weekend said that the large number of mutations found in the omicron variant appears to destabilize the virus, which might make it less “fit” than the dominant delta strain. As such, it would be a far less virulent strain... but of course that would also reduce the need for Moderna's mRNA therapy and so Bancel failed to mention it. What is grotesque is that the Moderna CEO’s comments on existing vaccines’ effectiveness against the omicron variant is “old news so should be a fade,” says Prashant Newnaha, a senior Asia-Pacific rates strategist at TD Securities in Singapore. Indeed as Bloomberg notes, Bancel reiterated comments made by Moderna’s Chief Medical Officer Paul Burton during the weekend. Alas, the last thing algos care about is nuance and/or reading between the lines, and so moments after Bancel's interview hit, markets hit risk off mode on Tuesday, and yesterday’s bounce in markets immediately reversed amid fresh worries about the efficacy of currently available vaccines with U.S. equity futures dropping along with stocks in Europe. Bonds gained as investors sought havens. After dropping as much as 1.2%, S&P futures pared losses to -0.7%, down 37 points just above 4,600. Dow Eminis were down 339 points or 1% and Nasdaq was down -0.8%. Adding to concerns is Fed Chair Jerome Powell who today will speak, alongside Janet Yellen, at the Senate Banking Committee in congressional oversight hearings related to pandemic stimulus. Last night Powell made a dovish pivot saying the new variant poses downside risks to employment and growth while adding to uncertainty about inflation. Powell's comments dragged yields lower and hit bank stocks overnight. “The market’s reaction to reports such as Moderna’s suggest the ball is still very much in the court of proving that this will not escalate,” said Patrick Bennett, head of macro strategy for Asia at Canadian Imperial Bank of Commerce in Hong Kong. “Until that time, mode is to sell recoveries in risk and not to try and pick the extent of the selloff” U.S. airline and cruiseliner stocks dropped in premarket trading Tuesday, after vaccine maker Moderna’s top executives reiterated that the omicron variant of the coronavirus may require new vaccines. Most U.S. airline stocks were down: Alaska Air -5%, United -3.2%, American -3%, Spirit -2.7%, Delta -2.6%, JetBlue -2.6%, Southwest -1.7%. Here are some other notable movers today: U.S. banks decline in premarket trading following comments from Federal Reserve Chair Jerome Powell that may push back bets on when the central bank will raise rates. Citigroup (C US) -2.4%, JPMorgan (JPM US) -2.2%, Morgan Stanley (MS US) -2.6% Vaccine manufacturers mixed in U.S. premarket trading after rallying in recent days and following further comments from Moderna about treating the new omicron Covid-19 variant. Pfizer (PFE US) +1.6%, Novavax  (NVAS US) +1.3%, Moderna (MRNA US) -3.8% U.S. airline and cruiseliner stocks dropped in premarket trading Tuesday, after vaccine maker Moderna’s top executives reiterated that the omicron variant of the coronavirus may require new vaccines. Alaska Air (ALK US) -5%, United (UAL US) -3.2%, American (AAL US) -3% Krystal Biotech (KRYS US) jumped 4.3% in postmarket trading on Monday, extending gains after a 122% jump during the regular session. The company is offering $200m of shares via Goldman Sachs, BofA, Cowen, William Blair, according to a postmarket statement MEI Pharma (MEIP US) gained 8% postmarket after the cancer-treatment company said it will hold a webcast Tuesday to report on data from the ongoing Phase 2 Tidal study evaluating zandelisib in patients with relapsed or refractory follicular lymphoma Intuit (INTU US) declined 3.4% postmarket after holder Dan Kurzius, co-founder of Mailchimp, offered the stake via Goldman Sachs In Europe, the Stoxx 600 index fell to almost a seven-week low. Cyclical sectors including retail, travel and carmakers were among the biggest decliners, while energy stocks tumbled as crude oil headed for the worst monthly loss this year; every industry sector fell led by travel stocks. Earlier in the session, the Asia Pacific Index dropped 0.6% while the Hang Seng China Enterprises Index lost 1.5% to finish at its weakest level since May 2016. Asian stocks erased early gains to head for a third day of losses on fresh concerns that existing Covid-19 vaccines will be less effective at tackling the omicron variant. The MSCI Asia Pacific Index extended its fall to nearly 1% after having risen as much as 0.8% earlier on Tuesday. The current crop of vaccines may need to be modified next year, Moderna Chief Executive Officer Stephane Bancel said in an interview with the Financial Times, adding that it may take months before pharmaceutical firms can manufacture new variant-specific jabs at scale. U.S. futures also reversed gains. Property and consumer staples were the worst-performing sectors on the regional benchmark. Key gauges in Hong Kong and South Korea were the biggest losers in Asia, with the Kospi index erasing all of its gains for this year. The Hang Seng China Enterprises Index lost 1.5% to finish at its weakest level since May 2016. The fresh bout of selling offset early optimism spurred by data showing China’s factory sentiment improved in November. “With the slower vaccination rate and more limited health-care capacity in the region, uncertainty from the new omicron variant may seem to bring about higher economic risks for the region at a time where it is shifting towards further reopening,” said Jun Rong Yeap, a market strategist at IG Asia Pte. Asia’s stock benchmark is now down 3.5% for the month, set for its worst performance since July, as nervousness remains over the U.S. Federal Reserve’s tapering schedule and the potential economic impact of the omicron variant. “Moderna is one of the primary mRNA vaccines out there, so the risk-off sentiment is justified,” said Kelvin Wong, an analyst at CMC Markets (Singapore) Pte. Liquidity is thinner going into the end of the year, so investors are “thinking it’s wise to take some money off the table,” he added Japanese equities fell, reversing an earlier gain to cap their third-straight daily loss, after a report cast doubt on hopes for a quick answer to the omicron variant of the coronavirus. Telecoms and electronics makers were the biggest drags on the Topix, which dropped 1%, erasing an earlier gain of as much as 1.5%. Fast Retailing and SoftBank Group were the largest contributors to a 1.6% loss in the Nikkei 225. The yen strengthened about 0.4% against the dollar, reversing an earlier loss. Japanese stocks advanced earlier in the day, following U.S. peers higher as a relative sense of calm returned to global markets. Tokyo share gains reversed quickly in late afternoon trading after a Financial Times report that Moderna’s Chief Executive Officer Stephane Bancel said a new vaccine may be needed to fight omicron. “The report of Moderna CEO’s remarks has bolstered an overall movement toward taking off risk,” said SMBC Trust Bank analyst Masahiro Yamaguchi. “Market participants will probably be analyzing information on vaccines and the new virus variant for the next couple of weeks, so shares will likely continue to fluctuate on these headlines.” In FX, the dollar dropped alongside commodity-linked currencies while the yen and gold climbed and bitcoin surged as safe havens were bid. The yen swung to a gain after Moderna Inc.’s chief executive Stephane Bancel was quoted by the Financial Times saying existing vaccines may not be effective enough to tackle the omicron variant. Commodity-linked currencies including the Aussie, kiwi and Norwegian krone all declined, underperforming the dollar In rates, treasuries held gains after flight-to-quality rally extended during Asia session and European morning, when bunds and gilts also benefited from haven flows. Stocks fell after Moderna CEO predicted waning vaccine efficacy. Intermediates lead gains, with yields richer by nearly 6bp across 7-year sector; 10-year Treasuries are richer by 5.6bp at 1.443%, vs 2.5bp for German 10-year, 4.7bp for U.K. Long-end may draw support from potential for month-end buying; Bloomberg Treasury index rebalancing was projected to extend duration by 0.11yr as of Nov. 22. Expectations of month-end flows may support the market, and Fed Chair Powell is slated to testify to a Senate panel.       In commodities, crude futures are off their late-Asia lows but remain in the red. WTI trades close to $68.30, stalling near Friday’s lows; Brent is off over 2.5% near $71.50. Spot gold rises ~$11 near $1,796/oz. Base metals are mixed: LME zinc outperforms, rising as much as 1.6%.  To the day ahead now, and the main central bank highlight will be Fed Chair Powell’s appearance before the Senate Banking Committee, alongside Treasury Secretary Yellen. In addition, we’ll hear from Fed Vice Chair Clarida, the Fed’s Williams, the ECB’s Villeroy and de Cos, and the BoE’s Mann. On the data side, we’ll get the flash November CPI reading for the Euro Area today, as well as the readings from France and Italy. In addition, there’s data on German unemployment for November, Canadian GDP for Q3, whilst in the US there’s the Conference Board’s consumer confidence measure for November, the FHFA house price index for September, and the MNI Chicago PMI for November. Market Snapshot S&P 500 futures down 1.2% to 4,595.00 STOXX Europe 600 down 1.4% to 460.47 MXAP down 0.5% to 190.51 MXAPJ down 0.6% to 620.60 Nikkei down 1.6% to 27,821.76 Topix down 1.0% to 1,928.35 Hang Seng Index down 1.6% to 23,475.26 Shanghai Composite little changed at 3,563.89 Sensex down 0.2% to 57,122.74 Australia S&P/ASX 200 up 0.2% to 7,255.97 Kospi down 2.4% to 2,839.01 German 10Y yield little changed at -0.36% Euro up 0.6% to $1.1362 Brent Futures down 3.0% to $71.26/bbl Brent Futures down 3.0% to $71.26/bbl Gold spot up 0.7% to $1,796.41 U.S. Dollar Index down 0.65% to 95.72 Top Overnight News from Bloomberg Euro-area inflation surged to a record for the era of the single currency and exceeded all forecasts, adding to the European Central Bank’s challenge before a crucial meeting next month on the future of monetary stimulus. If the drop in government bond yields on Friday signaled how skittish markets were, fresh declines are leaving them looking no less nervous. One of Germany’s most prominent economists is urging the European Central Bank to be more transparent in outlining its exit from unprecedented monetary stimulus and argues that ruling out an end to negative interest rates next year may be a mistake. The Hong Kong dollar fell into the weak half of its trading band for the first time since December 2019 as the emergence of a new coronavirus variant hurt appetite for risk assets. A more detailed look at global markets courtesy of Newsquawk Asian equities traded mixed with early momentum seen following the rebound on Wall Street where risk assets recovered from Friday’s heavy selling pressure as liquidity conditions normalized post-Thanksgiving and after some of the Omicron fears abated given the mild nature in cases so far, while participants also digested a slew of data releases including better than expected Chinese Manufacturing PMI. However, markets were later spooked following comments from Moderna's CEO that existing vaccines will be much less effective against the Omicron variant. ASX 200 (+0.2%) was underpinned by early strength across its sectors aside from utilities and with gold miners also hampered by the recent lacklustre mood in the precious metal which failed to reclaim the USD 1800/oz level but remained in proximity for another attempt. In addition, disappointing Building Approvals and inline Net Exports Contribution data had little impact on sentiment ahead of tomorrow’s Q3 GDP release, although the index then faded most its gains after the comments from Moderna's CEO, while Nikkei 225 (-1.6%) was initially lifted by the recent rebound in USD/JPY but then slumped amid the broad risk aversion late in the session. Hang Seng (-1.6%) and Shanghai Comp. (Unch) were varied in which the mainland was kept afloat for most the session after a surprise expansion in Chinese Manufacturing PMI and a mild liquidity injection by the PBoC, with a central bank-backed publication also suggesting that recent open market operations demonstrates an ample liquidity goal, although Hong Kong underperformed on tech and property losses and with casino names pressured again as shares in junket operator Suncity slumped 37% on reopen from a trading halt in its first opportunity to react to the arrest of its Chairman. Finally, 10yr JGBs were initially contained following early momentum in stocks and somewhat inconclusive 2yr JGB auction which showed better results from the prior, albeit at just a marginal improvement, but then was underpinned on a haven bid after fears of the Omicron variant later resurfaced. Top Asian News China’s Biggest Crypto Exchange Picks Singapore as Asia Base SoftBank-Backed Snapdeal Targets $250 Million IPO in 2022 Omicron Reaches Nations From U.K. to Japan in Widening Spread Slump in China Gas Shows Spreading Impact of Property Slowdown Major European bourses are on the backfoot (Euro Stoxx 50 -1.5%; Stoxx 600 -1.5%) as COVID fears again take the spotlight on month-end. APAC markets were firmer for a large part of the overnight session, but thereafter the risk-off trigger was attributed to comments from Moderna's CEO suggesting that existing vaccines will be much less effective against the Omicron COVID strain. On this, some caveats worth keeping in mind - the commentary on the potential need for a vaccine does come from a vaccine maker, who could benefit from further global inoculation, whilst data on the new variant remains sparse. Meanwhile, WSJ reported Regeneron's and Eli Lilly's COVID antiviral cocktails had lost efficacy vs the Omicron variant - however, the extent to which will need to be subject to further testing. Furthermore, producers appear to be confident that they will be able to adjust their products to accommodate the new variant, albeit the timeline for mass production will not be immediate. Nonetheless, the sullied sentiment has persisted throughout the European morning and has also seeped into US equity futures: the cyclically bias RTY (-1.7%) lags the ES (-1.0%) and YM (-1.3%), whilst the tech-laden NQ (-0.5%) is cushioned by the slump in yields. Back to Europe, broad-based losses are seen across the majors. Sectors tilt defensive but to a lesser extent than seen at the European cash open. Travel & Leisure, Oil & Gas, and Retail all sit at the bottom of the bunch amid the potential implications of the new COVID variant. Tech benefits from the yield play, which subsequently weighs on the Banking sector. The retail sector is also weighed on by Spanish giant Inditex (-4.3%) following a CEO reshuffle. In terms of other movers, Glencore (-0.9%) is softer after Activist investor Bluebell Capital Partners called on the Co. to spin off its coal business and divest non-core assets. In a letter seen by the FT, Glencore was also asked to improve corporate governance. In terms of equity commentary, analysts at JPM suggest investors should take a more nuanced view on reopening as the bank expects post-COVID normalisation to gradually asset itself over the course of 2022. The bank highlights hawkish central bank policy shifts as the main risk to their outlook. Thus, the analysts see European equities outperforming the US, whilst China is seen outpacing EMs. JPM targets S&P 500 at 5,050 (closed at 4,655.27 yesterday) by the end of 2022 with EPS at USD 240 – marking a 14% increase in annual EPS. Top European News Omicron Reaches Nations From U.K. to Japan in Widening Spread ECB Bosses Lack Full Diplomatic Immunity, EU’s Top Court Says Adler Keeps Investors Waiting for Answers on Fraud Claims European Gas Prices Surge Above 100 Euros With Eyes on Russia In FX, the Greenback may well have been grounded amidst rebalancing flows on the final trading day of November, as bank models are flagging a net sell signal, albeit relatively weak aside from vs the Yen per Cit’s index, but renewed Omicron concerns stoked by Moderna’s CEO casting considerable doubt about the efficacy of current vaccines against the new SA strain have pushed the Buck back down in any case. Indeed, the index has now retreated further from its 2021 apex set less than a week ago and through 96.000 to 95.662, with only the Loonie and Swedish Krona underperforming within the basket, and the Antipodean Dollars plus Norwegian Crown in wider G10 circles. Looking at individual pairings, Usd/Jpy has reversed from the high 113.00 area and breached a Fib just below the round number on the way down to circa 112.68 for a marginal new m-t-d low, while Eur/Usd is back above 1.1350 having scaled a Fib at 1.1290 and both have left decent option expiries some distance behind in the process (1.6 bn at 113.80 and 1.3 bn between 1.1250-55 respectively). Elsewhere, Usd/Chf is eyeing 0.9175 irrespective of a slightly weaker than forecast Swiss KoF indicator and Cable has bounced firmly from the low 1.3300 zone towards 1.3375 awaiting commentary from BoE’s Mann. NZD/AUD/CAD - As noted above, the tables have turned for the Kiwi, Aussie and Loonie along with risk sentiment in general, and Nzd/Usd is now pivoting 0.6800 with little help from a deterioration in NBNZ business confidence or a decline in the activity outlook. Similarly, Aud/Usd has been undermined by much weaker than forecast building approvals and a smaller than anticipated current account surplus, but mostly keeping hold of the 0.7100 handle ahead of Q3 GDP and Usd/Cad has shot up from around 1.2730 to top 1.2800 at one stage in advance of Canadian growth data for the prior quarter and month of September as oil recoils (WTI to an even deeper trough only cents off Usd 67/brl). Back down under, 1 bn option expiry interest at 1.0470 in Aud/Nzd could well come into play given that the cross is currently hovering near the base of a 1.0483-39 range. SCANDI/EM - The aforementioned downturn in risk appetite after Monday’s brief revival has hit the Sek and Nok hard, but the latter is also bearing the brunt of Brent’s latest collapse to the brink of Usd 70/brl at worst, while also taking on board that the Norges Bank plans to refrain from foreign currency selling through December having stopped midway through this month. The Rub is also feeling the adverse effect of weaker crude prices and ongoing geopolitical angst to the extent that hawkish CBR rhetoric alluding to aggressive tightening next month is hardly keeping it propped, but the Cnh and Cny continue to defy the odds or gravity in wake of a surprise pop back above 50.0 in China’s official manufacturing PMI. Conversely, the Zar is struggling to contain losses sub-16.0000 vs the Usd on SA virus-related factors even though Gold is approaching Usd 1800/oz again, while the Try is striving to stay within sight of 13.0000 following a slender miss in Turkish Q3 y/y GDP. In commodities, WTI and Brent front month futures are once again under pressure amid the aforementioned COVID jitters threatening the demand side of the equation, albeit the market remains in a state of uncertainty given how little is known about the new variant ahead of the OPEC+ confab. It is still unclear at this point in time which route OPEC+ members will opt for, but seemingly the feasible options on the table are 1) a pause in output hikes, 2) a smaller output hike, 3) maintaining current output hikes. Energy journalists have suggested the group will likely be influenced by oil price action, but nonetheless, the findings of the JTC and JMMC will be closely watched for the group's updated forecasts against the backdrop of COVID and the recently coordinated SPR releases from net oil consumers – a move which the US pledged to repeat if needed. Elsewhere, Iranian nuclear talks were reportedly somewhat constructive – according to the Russian delegate – with working groups set to meet today and tomorrow regarding the sanctions on Iran. This sentiment, however, was not reciprocated by Western sources (cited by WSJ), which suggested there was no clarity yet on whether the teams were ready for serious negotiations and serious concessions. WTI Jan resides around session lows near USD 67.50/bbl (vs high USD 71.22/bbl), while Brent Feb dipped under USD 71/bbl (vs high USD 84.56/bb). Over to metals, spot gold remains underpinned in European trade by the cluster of DMA's under USD 1,800/oz – including the 100 (USD 1,792/oz), 200 (USD 1,791/oz) and 50 (1,790/oz). Turning to base metals, LME copper is modestly softer around the USD 9,500/t mark, whilst Dalian iron ore futures meanwhile rose over 6% overnight, with traders citing increasing Chinese demand. US Event Calendar 9am: 3Q House Price Purchase Index QoQ, prior 4.9% 9am: Sept. FHFA House Price Index MoM, est. 1.2%, prior 1.0% 9am: Sept. Case Shiller Composite-20 YoY, est. 19.30%, prior 19.66%; S&P/CS 20 City MoM SA, est. 1.20%, prior 1.17% 9:45am: Nov. MNI Chicago PMI, est. 67.0, prior 68.4 10am: Nov. Conf. Board Consumer Confidenc, est. 111.0, prior 113.8 10am: Nov. Conf. Board Present Situation, prior 147.4 10am: Nov. Conf. Board Expectations, prior 91.3 Central Banks 10am: Powell, Yellen Testify Before Senate Panel on CARES Act Relief 10:30am: Fed’s Williams gives remarks at NY Fed food- insecurity event 1pm: Fed’s Clarida Discusses Fed Independence DB's Jim Reid concludes the overnight wrap Just as we go to print markets are reacting negatively to an interview with the Moderna CEO in the FT that has just landed where he said that with regards to Omicron, “There is no world, I think, where (the effectiveness) is the same level... we had with Delta…… I think it’s going to be a material drop (efficacy). I just don’t know how much because we need to wait for the data. But all the scientists I’ve talked to . . . are like ‘this is not going to be good’.”” This is not really new news relative to the last 3-4 days given what we know about the new mutation but the market is picking up on the explicit comments. In response S&P futures have gone from slightly up to down just over -0.5% and Treasury yields immediately dipped -4bps to 1.46%. The Nikkei has erased gains and is down around -1% and the Hang Seng is c.-1.8%. This is breaking news so check your screens after you read this. In China the official November PMI data came in stronger than expected with the Manufacturing PMI at 50.1 (49.7 consensus vs 49.2 previous) and the non-manufacturing PMI at 52.3 (51.5 consensus vs 52.4 previous). The negative headlines above as we go to print followed a market recovery yesterday as investors hoped that the Omicron variant wouldn’t prove as bad as initially feared. In reality, the evidence is still incredibly limited on this question, and nothing from the Moderna CEO overnight changes that. However the more positive sentiment was also evident from the results of our flash poll in yesterday’s EMR where we had 1569 responses so very many thanks. The poll showed that just 10% thought it would still be the biggest topic in financial markets by the end of the year, with 30% instead thinking it’ll largely be forgotten about. The other 60% thought it would still be an issue but only of moderate importance. So if that’s correct and our respondents are a fair reflection of broader market sentiment, then it points to some big downside risks ahead if we get notable bad news on the variant. For the record I would have been with the majority with tendencies towards the largely forgotten about answer. So I will be as off-side as much as most of you on the variant downside risk scenario. When I did a similar poll on Evergrande 2 and a half months ago, only 8% thought it would be significantly impacting markets a month later with 78% in aggregate thinking limited mention/impact, and 15% thinking it would have no impact. So broadly similar responses and back then the 15% were most correct although the next 78% weren’t far off. In terms of the latest developments yesterday, we’re still waiting to find out some of the key pieces of information about this new strain, including how effective vaccines still are, and about the extent of any increased risk of transmission, hospitalisation and death. Nevertheless, countries around the world are continuing to ramp up their own responses as they await this information. President Biden laid out the US strategy for tackling Omicron in a public address yesterday, underscoring the variant was a cause for concern rather than panic. He noted travel bans from certain jurisdictions would remain in place to buy authorities time to evaluate the variant, but did not anticipate that further travel bans or domestic lockdowns would be implemented, instead urging citizens to get vaccinated or a booster shot. Over in Europe, Bloomberg reported that EU leaders were discussing whether to have a virtual summit on Friday about the issue, and Poland moved to toughen up their own domestic restrictions, with a 50% capacity limit on restaurants, hotels, gyms and cinemas. In Germany, Chancellor Merkel and Vice Chancellor Scholz will be meeting with state premiers today, whilst the UK government’s vaccination committee recommended that every adult be eligible for a booster shot, rather than just the over-40s at present. Boosters have done a tremendous job in dramatically reducing cases in the elder cohort in the UK in recent weeks so one by product of Omicron is that it may accelerate protection in a wider age group everywhere. Assuming vaccines have some impact on Omicron this could be a positive development, especially if symptoms are less bad. Markets recovered somewhat yesterday, with the S&P 500 gaining +1.32% to recover a large portion of Friday’s loss. The index was driven by mega-cap tech names, with the Nasdaq up +1.88% and small cap stocks underperforming, with the Russell 2000 down -0.18%, so the market wasn’t completely pricing out omicron risks by any means. Nevertheless, Covid-specific names performed how you would expect given the improved sentiment; stay-at-home trades that outperformed Friday fell, including Zoom (-0.56%), Peloton (-4.35%), and HelloFresh (-0.8%), while Moderna (+11.80%) was the biggest winner following the weekend news that a reformulated vaccine could be available in early 2022. Elsewhere, Twitter (-2.74%) initially gained after it was announced CEO and co-founder Jack Dorsey would be stepping down, but trended lower throughout the rest of the day. The broader moves put the index back in positive territory for the month as we hit November’s last trading day today. Europe saw its own bounceback too, with the STOXX 600 up +0.69%. Over in rates, the partial unwind of Friday’s moves was even smaller, with yields on 10yr Treasuries moving up +2.6bps to 1.50%, driven predominantly by real rates, as inflation breakevens were a touch narrower across the curve. One part of the curve that didn’t retrace Friday’s move was the short end, where markets continued to push Fed rate hikes back ever so slightly, with the first full hike now being priced for September (though contracts as early as May still price some meaningful probability of Fed hikes). We may see some further movements today as well, with Fed Chair Powell set to appear before the Senate Banking Committee at 15:00 London time, where he may well be asked about whether the Fed plans to accelerate the tapering of their asset purchases although it’s hard to believe he’ll go too far with any guidance with the Omicron uncertainty. The Chair’s brief planned testimony was published on the Fed’s website last night. It struck a slightly more hawkish tone on inflation, noting that the Fed’s forecast was for elevated inflation to persist well into next year and recognition that high inflation imposes burdens on those least able to handle them. On omicron, the testimony predictably stated it posed risks that could slow the economy’s progress, but tellingly on the inflation front, it could intensify supply chain disruptions. The real fireworks will almost certainly come in the question and answer portion of the testimony. The bond moves were more muted in Europe though, with yields on 10yr bunds (+2.0bps), OATs (+1.0bps) and BTPs (+0.4bps) only seeing a modest increase. Crude oil prices also didn’t bounce back with as much rigor as equities. Brent gained +0.99% while WTI futures increased +2.64%. They are back down -1 to -1.5% this morning. Elsewhere in DC, Senator Joe Manchin noted that Democrats could raise the debt ceiling on their own through the reconciliation process, but indicated a preference for the increase not to be included in the build back better bill, for which his support still seems lukewarm. We’re approaching crucial deadlines on the debt ceiling and financing the federal government, so these headlines should become more commonplace over the coming days. There were some further developments on the inflation front yesterday as Germany reported that inflation had risen to +6.0% in November (vs. +5.5% expected) on the EU-harmonised measure, and up from +4.6% in October. The German national measure also rose to +5.2% (vs. +5.0% expected), which was the highest since 1992. Speaking of Germany, Bloomberg reported that the shortlist for the Bundesbank presidency had been narrowed down to 4 candidates, which included Isabel Schnabel of the ECB’s Executive Board, and Joachim Nagel, who’s currently the Deputy Head of the Banking Department at the Bank for International Settlements. Today we’ll likely get some further headlines on inflation as the flash estimate for the entire Euro Area comes out, as well as the numbers for France and Italy. There wasn’t much in the way of other data yesterday, though UK mortgage approvals fell to 67.2k in October (vs. 70.0k expected), which is their lowest level since June 2020. Separately, US pending home sales were up +7.5% in October (vs. +1.0% expected), whilst the Dallas Fed’s manufacturing activity index for November unexpectedly fell to 11.8 (vs. 15.0 expected). Finally, the European Commission’s economic sentiment indicator for the Euro Area dipped to 117.5 in November as expected, its weakest level in 6 months. To the day ahead now, and the main central bank highlight will be Fed Chair Powell’s appearance before the Senate Banking Committee, alongside Treasury Secretary Yellen. In addition, we’ll hear from Fed Vice Chair Clarida, the Fed’s Williams, the ECB’s Villeroy and de Cos, and the BoE’s Mann. On the data side, we’ll get the flash November CPI reading for the Euro Area today, as well as the readings from France and Italy. In addition, there’s data on German unemployment for November, Canadian GDP for Q3, whilst in the US there’s the Conference Board’s consumer confidence measure for November, the FHFA house price index for September, and the MNI Chicago PMI for November. Tyler Durden Tue, 11/30/2021 - 07:50.....»»

Category: blogSource: zerohedgeNov 30th, 2021

BTFDers Unleashed: Futures, Yields, Oil Jump As Omicron Panic Eases

BTFDers Unleashed: Futures, Yields, Oil Jump As Omicron Panic Eases As expected over the weekend, and as we first noted shortly after electronic markets reopened for trading on Sunday, S&P futures have maintained their overnight gains and have rebounded 0.7% while Nasdaq contracts jumped as much as 1.3% after risk sentiment stabilized following Friday’s carnage and as investors settled in for a few weeks of uncertainty on whether the Omicron variant would derail economic recoveries and the tightening plans of some central banks. Japan led declines in the Asian equity session (which was catching down to Friday's US losses) after the government shut borders to visitors. The region’s reopening stocks such as restaurants, department stores, train operators and travel shares also suffered some losses.  Oil prices bounced $3 a barrel to recoup some of Friday's rout, while the safe haven yen, Swiss franc and 10Y Treasury took a breather after its run higher. Moderna shares jumped as much as 12% in pre-market trading after Chief Medical Officer Paul Burton said he suspects the new omicron coronavirus variant may elude current vaccines, and if so, a reformulated shot could be available early in the new year. Which he would obviously say as his company makes money from making vaccines, even if they are not very efficient. Here are some of the other notable premarket movers today: BioNTech (BNTX US) advanced 5% after it said it’s starting with the first steps of developing a new adapted vaccine, according to statement sent by text. Merck & Co. (MRK US) declined 1.6% after it was downgraded to neutral from buy at Citi, which also opens a negative catalyst watch, with “high probability” the drugmaker will abandon development of its HIV treatment. A selection of small biotechs rise again in U.S. premarket trading amid discussion of the companies in StockTwits and after these names outperformed during Friday’s market rout. Palatin Tech (PTN US) +37%, Biofrontera (BFRI US) +22%, 180 Life Sciences (ATNF US) +19%. Bonds gave back some of their gains, with Treasury futures were down 11 ticks. Like other safe havens, the market had rallied sharply as investors priced in the risk of a slower start to rate hikes from the U.S. Federal Reserve, and less tightening by some other central banks. Needless to say, Omicron is all anyone can talk about: on one hand, authorities have already orchestrated a lot of global panic: Britain called an urgent meeting of G7 health ministers on Monday to discuss developments on the virus, even though the South African doctor who discovered the strain and treated cases said symptoms of Omicron were so far mild. The new variant of concern was found as far afield as Canada and Australia as more countries such as Japan imposed travel restriction to try to seal themselves off. Summarizing the fearmongering dynamic observed, overnight South African health experts - including those who discovered the Omicron variant, said it appears to cause mild symptoms, while the Chinese lapdog organization, WHO, said the variant’s risk is “extremely high”. Investors are trying to work out if the omicron flareup will a relatively brief scare that markets rebound from, or a bigger blow to the global economic recovery. Much remains unanswered about the new strain: South African scientists suggested it’s presenting with mild symptoms so far, though it appears to be more transmissible, but the World Health Organization warned it could fuel future surges of Covid-19 with severe consequences. "There is a lot we don't know about Omicron, but markets have been forced to reassess the global growth outlook until we know more," said Rodrigo Catril, a market strategist at NAB. "Pfizer expects to know within two weeks if Omicron is resistant to its current vaccine, others suggest it may take several weeks. Until then markets are likely to remain jittery." "Despite the irresistible pull of buying-the-dip on tenuous early information on omicron, we are just one negative omicron headline away from going back to where we started,” Jeffrey Halley, a senior market analyst at Oanda, wrote in a note. “Expect plenty of headline-driven whipsaw price action this week.” The emergence of the omicron strain is also complicating monetary policy. Traders have already pushed back the expected timing of a first 25-basis-point rate hike by the Federal Reserve to July from June. Fed Bank of Atlanta President Raphael Bostic played down economic risks from a new variant, saying he’s open to a quicker paring of asset purchases to curb inflation. Fed Chair Jerome Powell and Treasury Secretary Janet Yellen speak before Congress on Tuesday and Wednesday. “We know that central banks can quickly switch to dovish if they need to,” Mahjabeen Zaman, Citigroup senior investment specialist, said on Bloomberg Television. “The liquidity playbook that we have in play right now will continue to support the market.” European stocks rallied their worst drop in more than a year on Friday, with travel and energy stocks leading the advance. The Stoxx 600 rose 0.9% while FTSE 100 futures gain more than 1%, aided by a report that Reliance may bid for BT Group which jumped as much as 9.5% following a report that India’s Reliance Industries may offer to buy U.K. phone company, though it pared the gain after Reliance denied it’s considering a bid. European Central Bank President Christine Lagarde put a brave face on the latest virus scare, saying the euro zone was better equipped to face the economic impact of a new wave of COVID-19 infections or the Omicron variant Japanese shares lead Asian indexes lower after Premier Kishida announces entry ban of all new foreign visitors. Hong Kong’s benchmark Hang Seng Index closed down 0.9% at the lowest level since October 2020, led by Galaxy Entertainment and Meituan. The index followed regional peers lower amid worries about the new Covid variant Omicron. Amid the big movers, Galaxy Entertainment was down 5.4% after police arrested Macau’s junket king, while Meituan falls 7.1% after reporting earnings. In FX, currency markets are stabilizing as the week kicks off yet investors are betting on the possibility of further volatility. The South African rand climbed against the greenback though most emerging-market peers declined along with developing-nation stocks. Turkey’s lira slumped more than 2% after a report at the weekend that President Recep Tayyip Erdogan ordered a probe into foreign currency trades. The Swiss franc, euro and yen retreat while loonie and Aussie top G-10 leaderboard after WTI crude futures rally more than 4%. The Bloomberg Dollar Spot Index hovered after Friday’s drop, and the greenback traded mixed against its Group-of-10 peers; commodity currencies led gains. The euro slipped back below $1.13 and Bunds sold off, yet outperformed Treasuries. The pound was steady against the dollar and rallied against the euro. Australian sovereign bonds pared an opening jump as Treasuries trimmed Friday’s spike amid continuing uncertainty over the fallout from the omicron variant. The Aussie rallied with oil and iron ore. The yen erased an earlier decline as a government announcement on planned border closures starting Tuesday spurred a drop in local equities. The rand strengthens as South African health experts call omicron variant “mild.” In rates, Treasuries were cheaper by 4bp-7bp across the curve in belly-led losses, reversing a portion of Friday’s sharp safe-haven rally as potential economic impact of omicron coronavirus strain continues to be assessed. The Treasury curve bear- steepened and the benchmark 10-year Treasury yield jumped as much as 7 basis points to 1.54%; that unwound some of Friday’s 16 basis-point plunge -- the steepest since March 2020.  Focal points include month-end on Tuesday, November jobs report Friday, and Fed Chair Powell is scheduled to speak Monday afternoon. Treasuries broadly steady since yields gapped higher when Asia session began, leaving 10-year around 1.54%, cheaper by almost 7bp on the day; front-end outperformance steepens 2s10s by ~3bp. Long-end may draw support from potential for month-end buying; Bloomberg Treasury index rebalancing was projected to extend duration by 0.11yr as of Nov. 22 In commodities, oil prices bounced after suffering their largest one-day drop since April 2020 on Friday. "The move all but guarantees the OPEC+ alliance will suspend its scheduled increase for January at its meeting on 2 December," wrote analyst at ANZ in a note. "Such headwinds are the reason it's been only gradually raising output in recent months, despite demand rebounding strongly." Brent rebounded 3.9% to $75.57 a barrel, while U.S. crude rose 4.5% to $71.24. Gold has so far found little in the way of safe haven demand, leaving it stuck at $1,791 an ounce . SGX iron ore rises almost 8% to recoup Friday’s losses. Bitcoin rallied after falling below $54,000 on Friday. Looking at today's calendar, we get October pending home sales, and November Dallas Fed manufacturing activity. We also get a bunch of Fed speakers including Williams, Powell making remarks at the New York Fed innovation event, Fed’s Hassan moderating a panel and Fed’s Bowman discussing central bank and indigenous economies. Market Snapshot S&P 500 futures up 0.6% to 4,625.00 MXAP down 0.9% to 191.79 MXAPJ down 0.4% to 625.06 Nikkei down 1.6% to 28,283.92 Topix down 1.8% to 1,948.48 Hang Seng Index down 0.9% to 23,852.24 Shanghai Composite little changed at 3,562.70 Sensex up 0.4% to 57,307.46 Australia S&P/ASX 200 down 0.5% to 7,239.82 Kospi down 0.9% to 2,909.32 STOXX Europe 600 up 0.7% to 467.47 German 10Y yield little changed at -0.31% Euro down 0.3% to $1.1283 Brent Futures up 3.8% to $75.49/bbl Gold spot up 0.3% to $1,797.11 U.S. Dollar Index up 0.13% to 96.22 Top Overnight News from Bloomberg The omicron variant of Covid-19, first identified in South Africa, has been detected in locations from Australia to the U.K. and Canada, showing the difficulties of curtailing new strains While health experts in South Africa, where omicron was first detected, said it appeared to cause only mild symptoms, the Geneva-based WHO assessed the variant’s risk as “extremely high” and called on member states to test widely. Understanding the new strain will take several days or weeks, the agency said All travelers arriving in the U.K. starting at 4 a.m. on Nov. 30 must take a PCR coronavirus test on or before the second day of their stay and isolate until they receive a negative result. Face coverings will again be mandatory in shops and other indoor settings and on public transport. Booster shots may also be approved for more age groups within days, according to Health Secretary Sajid Javid The economic effects of the successive waves of the Covid pandemic have been less and less damaging, Bank of France Governor Francois Villeroy de Galhau says Italian bonds advance for a third day, as investors shrug off new coronavirus developments over the weekend and stock futures advance, while bunds are little changed ahead of German inflation numbers and a raft of ECB speakers including President Christine Lagarde A European Commission sentiment index fell to 117.5 in November from 118.6 the previous month, data released Monday showed Spanish inflation accelerated to the fastest in nearly three decades in November on rising food prices, underscoring the lingering consequences of supply-chain bottlenecks across Europe. Consumer prices jumped 5.6% Energy prices in Europe surged on Monday after weather forecasts showed colder temperatures for the next two weeks that will lift demand for heating ECB Executive Board member Isabel Schnabel took to the airwaves to reassure her fellow Germans that inflation will slow again, hours before data set to show the fastest pace of price increases since the early 1990s Russia’s ambassador to Washington said more than 50 diplomats and their family members will have to leave the U.S. by mid-2022, in the latest sign of tensions between the former Cold War enemies China sent the biggest sortie of warplanes toward Taiwan in more than seven weeks after a U.S. lawmaker defied a Chinese demand that she abandon a trip to the island A more detailed look at global markets courtesy of Newsquawk Asia-Pac stocks traded cautiously and US equity futures rebounded from Friday’s hefty selling (S&P 500 -2.3%) as all focus remained on the Omicron variant after several countries announced restrictions and their first cases of the new variant, although markets took solace from reports that all cases so far from South Africa have been mild. Furthermore, NIH Director Collins was optimistic that current vaccines are likely to protect against the Omicron variant but also noted it was too early to know the answers, while Goldman Sachs doesn’t think the new variant is a sufficient reason to adjust its portfolio citing comments from South Africa’s NICD that the mutation is unlikely to be more malicious and existing vaccines will most likely remain effective at preventing hospitalizations and deaths. ASX 200 (-0.5%) is subdued after Australia registered its first cases of the Omicron variant which involved two people that arrived in Sydney from southern Africa and with the government reviewing its border reopening plans. Nikkei 225 (-1.6%) whipsawed whereby it initially slumped at the open due to the virus fears and currency-related headwinds but then recouped its losses and briefly returned flat as the mood gradually improved, before succumbing to a bout of late selling, and with mixed Retail Sales data adding to the indecision. Hang Seng (-1.0%) and Shanghai Comp. (Unch) weakened with Meituan the worst performer in Hong Kong after posting a quarterly loss and with casino names pressured by a crackdown in which police detained Suncity Group CEO and others after admitting to accusations including illegal cross border gambling. However, the losses in the mainland were cushioned after firm Industrial Profits data over the weekend and with local press noting expectations for China to adopt a more proactive macro policy next year. Finally, 10yr JGBs shrugged off the pullback seen in T-note and Bund futures, with price action kept afloat amid the cautious mood in stocks and the BoJ’s presence in the market for over JPY 900bln of JGBs mostly concentrated in 3yr-10yr maturities. Top Asian News Hong Kong Stocks Slide to 13-Month Low on Fresh Virus Woes Li Auto Loss Narrows as EV Maker Rides Out Supply-Chain Snarls Singapore Adds to Its Gold Pile for the First Time in Decades China Growth Stocks Look Like Havens as Markets Confront Omicron Bourses in Europe are experiencing a mild broad-based rebound (Euro Stoxx 50 +1.0%; Stoxx 600 +0.9%) following Friday's hefty COVID-induced losses. Desks over the weekend have been framing Friday's losses as somewhat overstretched in holiday-thinned liquidity, given how little is known about the Omicron variant itself. The strain will likely remain the market theme as scientists and policymakers factor in this new variant, whilst data from this point forth – including Friday's US labour market report - will likely be passed off as somewhat stale, and headline risk will likely be abundant. Thus far, symptoms from Omicron are seemingly milder than some of its predecessors, although governments and central banks will likely continue to express caution in this period of uncertainty. Back to price action, the momentum of the rebound has lost steam; US equity futures have also been drifting lower since the European cash open – with the RTY (+0.9%) was the laggard in early European trade vs the ES (+0.8%), NQ (+1.0%) and YM (+0.7%). European cash bourses have also been waning off best levels but remain in positive territory. Sectors are mostly in the green, but the breadth of the market has narrowed since the cash open. Travel & Leisure retains the top spot in what seems to be more a reversal of Friday's exaggerated underperformance as opposed to a fundamentally driven rebound – with more nations announcing travel restrictions to stem the spread of the variant. Oil & Gas has also trimmed some of Friday's losses as oil prices see a modest rebound relative to Friday's slump. On the other end of the spectrum, Healthcare sees mild losses as COVID-related names take a mild breather, although Moderna (+9.1% pre-market) gains ahead of the US open after its Chief Medical Officer suggested a new vaccine for the variant could be ready early next year. Meanwhile, Autos & Parts reside as the current laggard amid several bearish updates, including a Y/Y drop in German car exports - due to the chip shortage and supply bottlenecks – factors which the Daimler Truck CEO suggested will lead to billions of Euros in losses. Furthermore, auto supbt.aplier provider Faurecia (-5.9%) trades at the foot of the Stoxx 600 after slashing guidance – again a function of the chip shortage. In terms of Monday M&A, BT (+4.7%) shares opened higher by almost 10% following source reports in Indian press suggesting Reliance Industries is gearing up for a takeover approach of BT – reports that were subsequently rebuffed. Top European News U.K. Mortgage Approvals Fall to 67,199 in Oct. Vs. Est. 70,000 Johnson Matthey Rises on Report of Battery Talks With Tata Gazprom Reports Record Third-Quarter Profit Amid Gas Surge Omicron’s Spread Fuels Search for Answers as WHO Sounds Warning In FX, the Buck has bounced from Friday’s pullback lows on a mixture of short covering, consolidation and a somewhat more hopeful prognosis of SA’s new coronavirus strand compared to very early perceptions prompted by reports that the latest mutation would be even worse than the Delta variant. In DXY terms, a base above 96.000 is forming within a 93.366-144 band amidst a rebound in US Treasury yields and re-steepening along the curve following comments from Fed’s Bostic indicating a willingness to back faster QE tapering. Ahead, pending home sales and Dallas Fed business manufacturing along with more Fed rhetoric from Williams and chair Powell on the eve of month end. AUD/CAD/NZD - No surprise to see the high beta and risk sensitive currencies take advantage of the somewhat calmer conditions plus a recovery in crude and other commodities that were decimated by the prospect of depressed demand due to the aforementioned Omicron outbreak. The Aussie is back over 0.7150 vs its US counterpart, the Loonie has pared back losses from sub-1.2750 with assistance from WTI’s recovery to top Usd 72/brl vs a Usd 67.40 trough on November 26 and the Kiwi is hovering above 0.6800 even though RBNZ chief economist Ha has warned that a pause in OCR tightening could occur if the fresh COVID-19 wave proves to be a ‘game-changer’. JPY/EUR - The major laggards as sentiment stabilses, with the Yen midway between 112.99-113.88 parameters and hardly helped by mixed Japanese retail sales data, while the Euro has retreated below 1.1300 where 1.7 bn option expiry interest resides and a key Fib level just under the round number irrespective of strong German state inflation reports and encouraging pan Eurozone sentiment indicators, as more nations batten down the hatches to stem the spread of SA’s virus that has shown up in parts of the bloc. GBP/CHF - Both narrowly divergent vs the Dollar, as Cable retains 1.3300+ status against the backdrop of retreating Gilt and Short Sterling futures even though UK consumer credit, mortgage lending and approvals are rather conflicting, while the Franc pivots 0.9250 and meanders from 1.0426 to 1.0453 against the Euro after the latest weekly update on Swiss bank sight deposits showing no sign of official intervention. However, Usd/Chf may veer towards 1.1 bn option expiries at the 0.9275 strike if risk appetite continues to improve ahead of KoF on Tuesday and monthly reserves data. SCANDI/EM - Although Brent has bounced to the benefit of the Nok, Sek outperformance has ensued in wake of an upgrade to final Swedish Q3 GDP, while the Cnh and Cny are deriving support via a rise in Chinese industrial profits on a y/y basis and the Zar is breathing a sigh of relief on the aforementioned ‘better’ virus updates/assessments from SA on balance. Conversely, the Try is back under pressure post-a deterioration in Turkish economic sentiment vs smaller trade deficit as investors look forward to CPI at the end of the week. Meanwhile, Turkish President Erdogan provides no reprieve for the Lira as he once again defending his unorthodox view that higher interest rates lead to higher inflation. In commodities, WTI and Brent front-month futures consolidate following an overnight rebound – with WTI Jan back on a USD 71/bbl handle and Brent Feb just under USD 75/bbl – albeit still some way off from Friday's best levels which saw the former's high above USD 78/bbl and the latter's best north of USD 81/bbl. The week is packed with risks to the oil complex, including the resumption of Iranian nuclear talks (slated at 13:00GMT/08:00EST today) and the OPEC+ monthly confab. In terms of the former, little is expected in terms of progress unless the US agrees to adhere to Tehran's demand – which at this point seems unlikely. Tehran continues to seek the removal of US sanctions alongside assurances that the US will not withdraw from the deal. "The assertion that the US must 'change its approach if it wants progress' sets a challenging tone", Citi's analysts said, and the bank also expects parties to demand full access to Iranian nuclear facilities for verification of compliance. Further, the IAEA Chief met with Iranian officials last week; although concrete progress was sparse, the overall tone of the meeting was one of progress. "We remain of the opinion that additional Iranian supplies are unlikely to reach the market before the second half of 2022 at the earliest," Citi said. Meanwhile, reports suggested the US and allies have been debating a "Plan B" if talks were to collapse. NBC News – citing European diplomats, former US officials and experts – suggested that options included: 1) a skinny nuclear deal, 2) ramp up sanctions, 3) Launching operations to sabotage Iranian nuclear advances, 4) Military strikes, 5) persuading China to halt Iranian oil imports, albeit Iran and China recently signed a 25yr deal. Over to OPEC+, a rescheduling (in light of the Omicron variant) sees the OPEC and JTC meeting now on the 1st December, followed by the JMMC and OPEC+ on the 2nd. Sources on Friday suggested that members are leaning towards a pause in the planned monthly output, although Russian Deputy PM Novak hit the wires today and suggested there is no need for urgent measures in the oil market. Markets will likely be tested, and expectations massaged with several sources heading into the meeting later this week. Elsewhere, spot gold trades sideways just under the USD 1,800/oz and above a cluster of DMAs, including the 50 (1,790.60/oz), 200 (1,791.30/oz) and 100 (1,792.80/oz) awaiting the next catalyst. Over to base metals, LME copper recoups some of Friday's lost ground, with traders also citing the underlying demand emanating from the EV revolution. US Event Calendar 10am: Oct. Pending Home Sales YoY, prior -7.2% 10am: Oct. Pending Home Sales (MoM), est. 0.8%, prior -2.3% 10:30am: Nov. Dallas Fed Manf. Activity, est. 17.0, prior 14.6 Central Bank speakers: 3pm: Fed’s Williams gives opening remarks at NY Innovation Center 3:05pm: Powell Makes Opening Remarks at New York Fed Innovation Event 3:15pm: Fed’s Hassan moderates panel introducing NY Innovation Center 5:05pm: Fed’s Bowman Discusses Central bank and Indigenous Economies DB's Jim Reid concludes the overnight wrap Last night Henry in my team put out a Q&A looking at what we know about Omicron (link here) as many risk assets put in their worst performance of the year on Friday after it exploded into view. The main reason for the widespread concern is the incredibly high number of mutations, with 32 on the spike protein specifically, which is the part of the virus that allows it to enter human cells. That’s much more than we’ve seen for previous variants, and raises the prospect it could be a more transmissible version of the virus, although scientists are still assessing this. South Africa is clearly where it has been discovered (not necessarily originated from) and where it has been spreading most. The fact that’s it’s become the dominant strain there in just two weeks hints at its higher level of contagiousness. However the read through to elsewhere is tough as the country has only fully vaccinated 24% of its population, relative to at least 68% in most of the larger developed countries bar the US which languishes at 58%. It could still prove less deadly (as virus variants over time mostly are) but if it is more contagious that could offset this and it could still cause similar healthcare issues, especially if vaccines are less protective. On the other hand the South African doctor who first alerted authorities to the unusual symptoms that have now been found to have been caused by Omicron, was on numerous media platforms over the weekend suggesting that the patients she has seen with it were exhausted but generally had mild symptoms. However she also said her patients were from a healthy cohort so we can’t relax too much on this. However as South African cases rise we will get a lot of clues from hospitalisation data even if only 6% of the country is over 65s. My personal view is that we’ll get a lot of information quite quickly around how bad this variant is. The reports over the weekend that numerous cases of Omicron have already been discovered around the world, suggests it’s probably more widespread than people think already. So we will likely soon learn whether these patients present with more severe illness and we’ll also learn of their vaccination status before any official study is out. The only caveat would be that until elderly patients have been exposed in enough scale we won’t be able to rule out the more negative scenarios. Before all that the level of restrictions have been significantly ramped up over the weekend in many countries. Henry discusses this in his note but one very significant one is that ALL travellers coming into (or back to) the UK will have to self isolate until they get a negative PCR test. This sort of thing will dramatically reduce travel, especially short business trips. Overnight Japan have effectively banned ALL foreign visitors. I appreciate its dangerous to be positive on covid at the moment but you only have to look at the UK for signs that boosters are doing a great job. Cases in the elderly population continue to collapse as the roll out progresses well and overall deaths have dropped nearly 20% over the last week to 121 (7-day average) - a tenth of where they were at the peak even though cases have recently been 80-90% of their peak levels. If Europe are just lagging the UK on boosters rather than anything more structural, most countries should be able to control the current wave all things being equal. However Omicron could make things less equal but it would be a huge surprise if vaccines made no impact. Stocks in Asia are trading cautiously but remember that the US and Europe sold off more aggressively after Asia closed on Friday. So the lack of major damage is insightful. The Nikkei (-0.02%), Shanghai Composite (-0.14%), CSI (-0.22%), KOSPI (-0.47%) and Hang Seng (-0.68%) are only slightly lower. Treasury yields, oil, and equity futures are all rising in Asia. US treasury yields are up 4-6bps across the curve, Oil is c.+4.5% higher, while the ZAR is +1.31%. Equity futures are trading higher with the S&P 500 (+0.71%) and DAX (+0.84%) futures in the green. In terms of looking ahead, we may be heading into December this week but there’s still an incredibly eventful period ahead on the market calendar even outside of Omicron. We have payrolls on Friday which could still have a big impact on what the Fed do at their important December 15 FOMC and especially on whether they accelerate the taper. Wednesday (Manufacturing) and Friday (Services) see the latest global PMIs which will as ever be closely watched even if people will suggest that the latest virus surge and now Omicron variant may make it backward looking. Elsewhere in the Euro Area, we’ll get the flash CPI estimate for November tomorrow (France and Italy on the same day with Germany today), and we’ll hear from Fed Chair Powell as he testifies (with Mrs Yellen) before congressional committees tomorrow and Wednesday. There’s lots of other Fed speakers this week (ahead of their blackout from this coming weekend) and last week there was a definite shift towards a faster taper bias, even amongst the doves on the committee with Daly being the most important potential convert. Fed speakers this week might though have to balance the emergence of the new variant with the obvious point that without it the Fed is a fair bit behind the curve. Importantly but lurking in the background, Friday is also the US funding deadline before another government shutdown. History would suggest a tense last minute deal but it’s tough to predict. Recapping last week now and the emergence of the new variant reshaped the whole week even if ahead of this, continued case growth across Europe prompted renewed lockdown measures and travel bans across the continent. Risk sentiment clearly plummeted on Friday. The S&P 500 fell -2.27%, the biggest drop since October 2020, while the Stoxx 600 fell -3.67%, the biggest one-day decline since the original Covid-induced risk off in March 2020. The S&P 500 was -2.20% lower last week, while the Stoxx 600 was down -4.53% on the week. 10yr treasury, bund, and gilt yields declined -16.1bps, -8.7bps, and -14.5bps, undoing the inflation and policy response-driven selloff from earlier in the week. The drop in 10yr treasury and gilt yields were the biggest one-day declines since the original Covid-driven rally in March 2020, while the drop in bund yields was the largest since April 2020. 10yr treasury, bund, and gilt yields ended the week -7.3bps lower, +0.7bps higher, and -5.4bps lower, respectively. Measures of inflation compensation declined due to the anticipated hit to global demand, with 10yr breakevens in the US and Germany -6.8bps and -8.8bps lower Friday, along with Brent and WTI futures declining -11.55% and -13.06%, respectively. Investors pushed back the anticipated timing of rate hikes. As it stands, the first full Fed hike is just about priced for July, and 2 hikes are priced for 2022. This follows a hawkish tone from even the most dovish FOMC members and the November FOMC minutes last week. The prevailing sentiment was the FOMC was preparing to accelerate their asset purchase taper at the December meeting to enable inflation-fighting rate hikes earlier in 2022. Understanding the impact of the new variant will be crucial for interpreting the Fed’s reaction function, though. The impact may not be so obvious; while a new variant would certainly hurt global demand and portend more policy accommodation, it will also likely prompt more virus-avoiding behaviour in the labour market, preventing workers from returning to pre-Covid levels. Whether the Fed decides to accommodate these sidelined workers for longer, or to re-think what constitutes full employment in a Covid world should inform your view on whether they accelerate tapering in December. It feels like a lifetime ago but last week also saw President Biden nominate Chair Powell to head the Fed for another term, and for Governor Brainard to serve as Vice Chair. The announcement led to a selloff in rates as the more dovish Brainard did not land the head job. In Germany, the center-left SPD, Greens, and liberal FDP agreed to a full coalition deal. The traffic-light coalition agreed to restore the debt break in 2023, after being suspended during the pandemic, and to raise the minimum wage to €12 per hour. The SPD’s Olaf Scholz will assume the Chancellorship. The US, China, India, Japan, South Korea, and UK announced releases of strategic petroleum reserves. Oil prices were higher following the announcement, in part because releases were smaller than anticipated but, as mentioned, prices dropped precipitously on Friday on the global demand impact of the new Covid variant. The ECB released the minutes of the October Governing Council meeting, where officials stressed the need to maintain optionality in their policy setting. They acknowledged growing upside risks to inflation but stressed the importance of not overreacting in setting policy as they see how inflation scenarios might unfold. Tyler Durden Mon, 11/29/2021 - 08:01.....»»

Category: dealsSource: nytNov 29th, 2021

Year-End Outlook: Labor Could Spark ‘Transformational’ Changes

Editor’s Note: RISMedia’s Year-End Outlook series provides an in-depth analysis of the housing market’s leading indicators for economic health, and showcases expert insights on what’s to come in 2022. Dolly Parton might still be plugging away at a nine to five, and BTO might still catch the 8:15 train into the city, but for most […] The post Year-End Outlook: Labor Could Spark ‘Transformational’ Changes appeared first on RISMedia. Editor’s Note: RISMedia’s Year-End Outlook series provides an in-depth analysis of the housing market’s leading indicators for economic health, and showcases expert insights on what’s to come in 2022. Dolly Parton might still be plugging away at a nine to five, and BTO might still catch the 8:15 train into the city, but for most of the country, the traditional machinations of labor have changed. Besides the well-documented shifts to remote in many industries, rising wages and a rapidly evolving outlook on what work fundamentally should look like appears to be altering the entire labor economy as people quit their jobs in droves and companies scramble to accommodate new priorities and philosophies. Many pundits have sought to quickly or succinctly sum up all these changes, or attribute new attitudes to a single event or ideology, but the reality is that the future of labor—both short- and long-term—remains deeply uncertain, and the causes and effects of a shifting labor economy have not been parsed out. Despite the lack of answers to these fundamental questions, economists and experts that spoke to RISMedia say that there is still plenty that stakeholders—especially in the real estate industry—need to keep an eye on. Jake Vigdor, an employment and education economist currently working for the University of Washington, says shifts caused by the new labor market are likely to manifest both in philosophical as well as geographic shifts. “There was this period of time last year when people were saying, ‘San Francisco is going to die,’ or ‘New York City is going to die,’’’ he says. “I don’t think that’s really the case. If you’re thinking about where the transactions are going to be growing over the next year or so, that’s going to be hard to forecast.” Work-from-home trends and labor shifts have indicated a broad geographic diffusal of population, specifically high-earning and younger families, Vigdor adds. Though it is far too early to say for certain exactly how and to what extent these changes will take hold, likely they will affect more immediate and lasting change than other more widely watched metrics. In October, unemployment overall fell from 4.8% to 4.6%, and the economy has steadily added more jobs through the last few months. But this progress belies some deeper issues that are not going away anytime soon. Greg Reed is a labor economist specializing in real estate and urban land at the University of Wisconsin in Madison. He says the big job numbers often touted by media outlets and the federal government are less important than many other underlying factors. Barriers that are preventing people from re-entering the workforce—unaffordable or unavailable child care, wages, health care and discrimination—threaten both short-term recovery and the overall stability of the economy. “I’m honestly more concerned down the road for those people who are really looking for jobs and really wanted to work and had to work, but because of COVID or for whatever reason—ageism, sexism, you just add what ‘ism’ to it—weren’t able to find jobs during COVID,” Reed says. And they may still need to find something. What’s going to happen to them longer term?” “There’s some disruption here that’s going to have some structural impact,” he adds. The sector that most immediately affects real estate, at least right now, is the home construction industry. A new report from the Home Builders Institute (HBI) estimated that the country needs to add 2.2 million more jobs between now and 2024 to keep up with demand, and currently is looking at a deficit of 300,000 to 400,000 laborers. Ed Brady is the CEO of HBI, and he warns that this worker shortage both preceded and will likely persist past the broader labor crunch. “I think it‘s been at kind of a crisis level for a while, pre-pandemic and post-pandemic, and even during the pandemic—as you know we remained essential, and so building and developing were still moving forward,” he says. “We’re losing a lot more than we’re bringing in.” The Next 12 Months Policy changes are certain to have broad and disparate impacts on the job market. Many companies have yet to set long-term or permanent work-from-home rules, while the federal government has the chance to impact jobs through immigration policy, vaccine mandates or through a stalled federal bill that could begin addressing child care shortages and adding infrastructure- or climate-focused jobs. Regardless of the progress on these things in Washington, Vigdor says he still sees relative strength in the labor market’s recovery, with expectations that there is no immediate danger of a collapse or recession. “Our risk of heading into some sort of recession with mass unemployment is pretty low right now,” he says. But the most optimistic projections, looking at a return to pre-pandemic levels and modes, is much less realistic according to Vigdor, as American workers have indicated they are not willing to accept the old ways of doing things and recovery efforts still have a long way to go. “The economy over the next year or so—it will be kind of like cleaning up your house after a big party,” he says. “The place is a giant mess, and you look at it and you say, ‘Oh man.’” “Eventually you’ll get it all cleaned up, but…it could take a year or more,” he adds. “All of this stuff will eventually get worked out, but it’s not going to be quick.” There are also more fundamental issues, many of which preceded the pandemic, which will hamper a return to goals set by the Fed or other metrics of a healthy economy. These include everything from a lack of child care to health care costs to immigration restrictions. “We still have a lot of parents who are having trouble getting child care,” Vigdor says. “And another one is immigration…just talking about people who have visas, legal immigrants to the United States—that’s hundreds of thousands of new workers every year in an ordinary year— and that has basically ground to a halt.” A lack of incoming refugees, who are essential workers in many sectors, Vigdor says, is also styming economic growth and contributing to labor issues. Immigration affects every job sector, he adds, from the highest paying tech jobs all the way down to farm work. Many problems have also disproportionately affected people of color and women, with unemployment for Black and Hispanic workers staying stagnant in the most recent job report, even as overall unemployment fell. According to Reed, these issues will specifically dampen the real estate market in ways that go beyond finding construction workers to build houses. Commercial projects will stall if companies cannot find people to clean or maintain the property, appliances for new homes will sit in warehouses with no one to deliver them and apartment complexes will halt expansions if they don’t have staff to serve tenants or provide other on-site services. “It just seems like it’s permeating a lot, a lot of components of life,” Reed reflects. “It throws the sequencing off on so many different levels. And it just increases the uncertainty, and no one likes uncertainty.” Vigdor also worries that this labor shortage is unique in that it has affected nearly every region and sector equally—something that is rare historically in the U.S. He also points out that removing supplemental unemployment benefits and returning students to school full time did almost nothing to alleviate the labor shortage, indicating that the shortage is more than just a blip that will resolve itself as the virus fades, and will instead require more investment from companies and policymakers. Wages, Geography and Education To address a lack of carpenters, contractors, foremen, plumbers and electricians who build and rehab the homes necessary to keep the real estate industry growing, the answer must start with education, according to Brady. “Investing in schools, investing in pre-apprenticeship education…is one step. The country has to invest in that,” he says. “We can immediately change the dialogue in the secondary schools that you’re not ‘alternative’ if you’re going into the trades. It’s a first path, it’s not an alternative path, and we need to change that perception.” Trade jobs are especially hard to fill quickly, Brady argues, because experience is so important. A carpenter fresh out of school might take twice or three times as long to put up a house as one with 15 years of experience. Even if the country begins bringing in enough materials at cheap enough prices to begin alleviating the pressure of housing shortages, Brady claims the market will still be bottlenecked without enough skilled labor. “Productivity, I contend, as long as we’re not investing in younger people…I think it’s going to get worse before it gets better. That’s why we have to invest in it now for the future,” he says. The recent HBI report found that about half of construction workers in the trades make more than the median annual income in the country. But likely the industry will need to continue raising wages to attract more workers, according to Vigdor, as workers have more choices and negotiating power in their jobs than any time in recent memory. “Finding the carpentry crews and the masonry crews…if you’re having a tougher time finding that workforce, it’s going to lead to a slow down in new inventory,” he says. Reed says that every industry right now needs to understand that businesses will have to invest more in paying their workers if they want to compete—or even stay open. “There needs to be a wake-up call that in order to not only attract, but also retain that talent, they’re going to have to pay more,” he says. On the positive side for real estate, an increase in wages for lower-paying jobs could elevate some number of families, from renters just scraping by to prospective homebuyers. Federal programs offering down payment assistance and increasing affordability in housing could bolster that trend, according to Vigdor. “Some of these traditionally lower-incomes households, they’re getting bigger and steadier paychecks. That could lead to a situation where your markets for things like starter homes…there could be some renewed interest there,” he says. This scenario depends on how inflation continues—if wages and incomes can keep up with that metric—and also if the current levels of growth will continue long term (Reed says he believes they will). “I think the marketplace is speaking loud and clear, and I don’t see wages flipping notably from the higher levels they are now meeting,” Reed contends. “I can’t tell you the number of people who have said, ‘Why would I take a job at $10 an hour?’” A trend like this could create a relative explosion of buyers in the starter home price range, especially in marginal markets, Vigdor predicts. While coastal and expensive suburban areas would not see much change, various semi-rural areas outside bigger metros, and smaller cities spread across the Midwest and South, could quickly heat up in terms of real estate. At the same time, an entirely separate trend could also vastly alter the geography of work—and real estate. Big tech companies are currently diffusing their physical presence broadly across the country to match workers’ preferences, Vigdor says, which was something that started well before the pandemic. Distributing your workforce and offices as a tech company actually makes more sense than having huge central space-age complexes, he posits, and many companies had already begun spreading out before the pandemic. If Amazon, Facebook or Google end up bringing most workers back in person, Vigdor says the likely path will not be a return to the original offices but rather an expansion of satellite locations to dozens of places beyond large headquarters in Silicon Valley, New York or Austin, allowing people to live in disparate locations while still having a physical office somewhat accessible if need be. “It’s not going to be the thing that brings Gary, Indiana back or anything like that,” he cautions. “These relocations are people moving from really expensive places, to other somewhat cheaper but still desirable locations. So that’s going to affect the real estate markets.” These cities could be places in the Midwest or Sun Belt that have already seen tremendous growth during the pandemic, or they could affect areas that have yet to see that kind of attention, Vigdor says. This “decentralizing” is specifically unpredictable and will depend on the kind of amenities workers value, and where companies can find favorable conditions as far as taxes and other preferences. Other factors, like cities that have universities focused on specific cutting-edge research like robotics or AI will also draw some of these companies, Vigdor says. “The stuff is happening, and it’s been happening for quite some time. That will be an interesting thing to see,” he says. Again, what exactly the ramifications of these individual trends might be remains hard to predict. All of them have the potential to snowball and cause a domino effect that begins to alter behaviors in various other silos or sectors. But as labor appears to be evolving on a fundamental level post-pandemic, there is a distinct likelihood that the next several months will see some transformational changes in work. “Wall Street loves to see regular, consistent numbers on jobs reports,” Reed says. “I’m a little more concerned about those longer-term implications.” Jesse Williams is RISMedia’s associate online editor. Email him your real estate news ideas to jwilliams@rismedia.com. The post Year-End Outlook: Labor Could Spark ‘Transformational’ Changes appeared first on RISMedia......»»

Category: realestateSource: rismediaNov 10th, 2021

10 Things in Politics: Hunter Biden"s art raises ethical questions

And Republicans are bracing for an awkward Trump speech at a big donor event. Welcome back to 10 Things in Politics. Sign up here to receive this newsletter. Plus, download Insider's app for news on the go - click here for iOS and here for Android. Send tips to bgriffiths@insider.com.Here's what we're talking about:Hunter Biden isn't Trump, but what he's up to deserves your attention - even if you hate Fox NewsRepublicans are bracing for an awkward Trump speech at a big donor eventDemocrats are already floating another massive spending billWith Phil Rosen. Teresa Kroeger/Getty Images for World Food Program USA; Chip Somodevilla/Getty Images; Samantha Lee/Insider 1. INSIDE BIDENWORLD: President Joe Biden's "absolute wall" between him and his family's business interests sounds formidable. But in practice, it fails at the presidential level, my colleague Mattathias Schwartz writes.Here's a look at why ethics experts are fuming:Hunter Biden's art illustrates why Biden's wall doesn't work: Earlier this month, Biden's son hobnobbed with wealthy art patrons while hoping to sell his work for as much as $500,000 a pop. Under an arrangement approved by the White House, the younger Biden is free to meet with prospective buyers at such events, so long as only his gallerist knows the identity of those who place bids on his paintings. But the gallery won't say how it's vetting buyers and where it's drawing the line.This uneasy relationship is nothing new: It's still a stark contrast from Donald Trump's approach, in which, for instance, corporate lobbyists, foreign governments, and his own Secret Service detail spent millions to stay at his hotels and golf resorts during his presidency.But one expert says the US would cry foul if another nation allowed this: "If we were monitoring some developing country and learned that the president's son was about to make millions from the sale of his art, and hadn't sold any art before, we'd be talking to that country's leadership about the need for ethical reform," Walter Shaub, a former director of the US Office of Government Ethics, told my colleague.Read more about how the actions of some of President Joe Biden's family members hark back to a particular theme in Washington.2. Republicans are bracing for an awkward Trump speech: The former president is set to speak at a major GOP donor event in Palm Beach, Florida. Trump is publicly calling for Mitch McConnell's ouster as the top Senate Republican, which is why some donors are surprised that Sen. Rick Scott invited Trump to speak. "It's always interesting with Trump. Whoever wants to be there can be there," said one person involved with planning the event. Read what else Republicans are saying from the $1,300-a-night resort where they await Trump.That's one way to make an entrance: Trump, in a statement, said Republicans wouldn't vote in the midterms if his widely debunked claims about the 2020 election weren't "solved." US climate envoy John Kerry in Paris in March. MARTIN BUREAU/AFP via Getty Images 3. Kerry tempers expectations for major climate summit: The US climate envoy John Kerry says climate talks next month in Glasgow will most likely end without major nations setting the necessary goals needed to get a grip on the climate crisis before it's too late, the Associated Press reports. Kerry told the AP, though, that he was not lowering expectations for a summit he and other top leaders once billed as "the last, best chance" on climate action. Here's where things stand just weeks away from the major climate talks.Key quote: "It would be like President Trump pulling out of the Paris agreement, again," Kerry told the AP of what would happen if Congress failed to pass significant climate legislation.4. Biden is trying to save Christmas: Biden announced plans for the Port of Los Angeles to move to 24/7 operations, joining one of the nation's other busiest ports as leaders try to address a cargo bottleneck that has already led to shortages and price increases, NBC News reports. Major retailers like Walmart and shipping companies like UPS and FedEx will also step up their efforts to address supply-chain issues. The White House's push comes amid fears that shortages could wreak havoc on holiday shopping.5. Democrats are already floating another massive spending bill: If they can't cram all of Biden's social-spending promises into the reconciliation bill this year, Democrats may try again next year. Rep. John Yarmuth of Kentucky, the chair of the powerful House Budget Committee, mapped out a scenario in which provisions that might be dropped, like a Medicare expansion, be repackaged in a new bill right before the midterms. More on what top lawmakers are considering as they continue to debate cuts to their $3.5 trillion plan. Apple; Disney+; Netflix; Hulu; Amazon; HBO; Insider 6. Inside Hollywood's battle for the hottest TV shows: The launch of new streaming services has shaken up the hierarchy of Hollywood's top TV buyers. But HBO is the most popular place to sell a scripted TV show, according to interviews with 18 industry insiders. Read more about how Netflix is changing, Apple's search for its breakout drama, and Amazon's struggle to define its identity.7. Johnson & Johnson wants to dole out 2nd doses of its COVID-19 vaccine, but the FDA isn't so sure: Food and Drug Administration scientists say a booster of J&J's COVID-19 shot could bolster the immune response in theory, but the data isn't there yet. The agency pointed to the lack of robust clinical-trial results supporting a second shot six months after the first dose. An expert panel is expected to vote Friday on whether the agency should OK the booster shots.8. Capitol riot panel readies for subpoena fight: Lawmakers on the House select committee investigating the January 6 insurrection say they're planning to increase their efforts to force top Trump administration officials to cooperate with their investigation, The Washington Post reports. Former officials like Steve Bannon have said they won't cooperate because of Trump's decision to invoke executive privilege. Bannon was supposed to sit for an interview with lawmakers today. The panel also issued a subpoena for Jeffrey Clark, a former Justice Department official who was closely involved in Trump's efforts to press his voter-fraud claims. Here's where the investigation stands.9. Katie Couric says she edited RBG's comments on kneeling during the anthem: Couric edited out comments Supreme Court Justice Ruth Bader Ginsburg made in a 2016 interview, seeking to "protect" the octogenarian justice, the TV journalist says in her new book. Per Couric, Ginsburg said athletes who knelt during the national anthem before sporting events were showing "contempt for a government that has made it possible for their parents and grandparents to live a decent life." Couric did report that Ginsburg called kneeling "dumb and disrespectful," but she did not include the full remarks. More on what Couric says was her behind-the-scenes struggle to figure out what to do with Ginsburg's comments. Jeff Bezos pinned astronaut wings on William Shatner after the "Star Trek" star's spaceflight on Wednesday. Blue Origin 10. William Shatner cried telling Jeff Bezos about his flight to space: The "Star Trek" star said staring into the blackness of space was like looking at death. "I hope I never recover," he said after his flight Wednesday. Emotions overcame Shatner as he recounted his time aboard Blue Origin's New Shepard rocket. At 90, Shatner is the oldest person to fly in space. See his full comments.Today's trivia question: Speaking of presidential families, who was responsible for Billy Beer? Email your answer and a suggested question to me at bgriffiths@insider.com.Yesterday's answer: In 1909, William Howard Taft became the first president to begin working in the Oval Office.Read the original article on Business Insider.....»»

Category: smallbizSource: nytOct 14th, 2021

Recent Stock Market Volatility Dangerous for Real Estate? Experts Unconvinced

Real estate experts believe recent stock market volatility isn’t concerning as long as it’s temporary, despite a rocky start to the week for trading, as well as global events worrying investors. According to Ruben Gonzalez, chief economist for Keller Williams, recent declines in the market are mainly due to fears on Wall Street that the […] The post Recent Stock Market Volatility Dangerous for Real Estate? Experts Unconvinced appeared first on RISMedia. Real estate experts believe recent stock market volatility isn’t concerning as long as it’s temporary, despite a rocky start to the week for trading, as well as global events worrying investors. According to Ruben Gonzalez, chief economist for Keller Williams, recent declines in the market are mainly due to fears on Wall Street that the Chinese property market could disrupt global financial markets. Those concerns prompted a stock market selloff that dealt a sizable blow to major U.S. stock indexes. On Monday, Sept. 20, the S&P 500 posted its worst daily performance since May, falling 1.7%, while the Dow Jones Industrial Average had its biggest single-day drop since mid-July with a 1.8% decline. The effects have proven to be short-lived as indexes rebounded days later with ongoing signs of recovery, despite overseas issues. As of Sept. 24, The Dow and the S&P 500 concluded the week on Wall Street in better shape overall. The Dow added 0.1% and the S&P 500 rose 0.15% at the close of trading on Friday. “We don’t view short-term stock market volatility as a huge factor impacting real estate markets,” says Gonzalez. “However, as smaller investors look to park capital gains in a more stable environment, we could certainly see some of that money migrating into residential real estate.” Watching the Volatility A short period of shaky stock activity may not hurt the housing market. However, sustained volatility could pose a problem, particularly for homebuyers, according to Anthony Lamacchia, CEO of Lamacchia Realty. “As long as it’s not ongoing, it’s nothing and won’t do anything to housing, but when it appears to be continuous, that’s when you see people pull back. “Lamacchia says, noting the 2020 COVID-induced recession as an example of the adverse impacts to market activity. “People didn’t just pull back because they were stuck in their houses,” Lamacchia continues. “They also pulled back because their 401Ks were crashing to the ground. If [the volatility] continues, you’ll see buyers get a little more hesitant.” Lamacchia isn’t convinced that will happen, and neither is Rick Sharga, executive vice president at RealtyTrac, an ATTOM company. Sharga shared similar sentiments as Lamacchia, adding that a period of short-term volatility in the market could push more people to move their money into real estate. “A period with a risk of a market downturn [could push] people to go to a safer haven, and that very often leads to more investment in real estate,” Sharga says. “You could have just the opposite of the effect. If we were to see a continued selloff in the marketplace, that does have a psychological impact on the market to where people get a little more conservative with their money.” Fed Eases Nerves Improvements in stock market activity are also tied to the recent Federal Reserve policy update, according to George Ratiu, manager of economic research at realtor.com®. “There is always a maxim that holds for stock market activity which is stock markets abhor uncertainty,” Ratiu says, also noting ongoing issues with the Delta variant and slowing momentum domestically as factors in investors’ skittish behavior in recent days. Ratiu thinks the uncertainty has cleared after the Fed announced plans to keep interest rates near zero and maintain the current pace of asset purchases. The Fed also indicated that rate hikes could happen sooner than they projected in June. Experts at the Mortgage Bankers Association (MBA) say they aren’t surprised at the Fed’s plans to remove accommodation, in a statement following the FOMC’s Sept. 22 meeting. “The job market has improved, inflation is running hot and supply chain constraints are persisting,” says Mike Fratantoni, SVP and chief economist at MBA. “The biggest news out of this meeting was the change in FOMC projections, with most members now seeing a first interest rate hike in 2022, which is faster than many market participants had previously anticipated.” Fratantoni also notes that a pending taper and change to the monetary policy outlook will likely contribute to a modest increase in mortgage rates over the medium term. Cautiously Watching Despite optimism over recent market rebounds, there is a chance that volatility could continue, according to DataCore Partners LLC Chief Economist Donald Klepper-Smith, who suggests that the stock market is in “nosebleed territory.” “This is an overextended market, and I don’t think it’s sustainable in the long run,” Klepper-Smith says. “Right now, the stock market is being propped up behind the scenes by the Federal Reserve, and the question is can they do this indefinitely?” Klepper-Smith doesn’t think so, stating that at some point, “we are going to have to live within our means.” “I think the stock market is usually a leading economic indicator of future activity, and my sense here is we are going to be watching a consolidation over the near term, so we’ll keep our eyes on it,” Klepper-Smith says. Jordan Grice is RISMedia’s associate content editor. Email him your real estate news to jgrice@rismedia.com. The post Recent Stock Market Volatility Dangerous for Real Estate? Experts Unconvinced appeared first on RISMedia......»»

Category: realestateSource: rismediaSep 24th, 2021

Futures Bounce On Evergrande Reprieve With Fed Looming

Futures Bounce On Evergrande Reprieve With Fed Looming Despite today's looming hawkish FOMC meeting in which Powell is widely expected to unveil that tapering is set to begin as soon as November and where the Fed's dot plot may signal one rate hike in 2022, futures climbed as investor concerns over China's Evergrande eased after the property developer negotiated a domestic bond payment deal. Commodities rallied while the dollar was steady. Contracts on the S&P 500 and Nasdaq 100 flipped from losses to gains as China’s central bank boosted liquidity when it injected a gross 120BN in yuan, the most since January... ... and investors mulled a vaguely-worded statement from the troubled developer about an interest payment.  S&P 500 E-minis were up 23.0 points, or 0.53%, at 7:30 a.m. ET. Dow E-minis were up 199 points, or 0.60%, and Nasdaq 100 E-minis were up 44.00 points, or 0.29%. Among individual stocks, Fedex fell 5.8% after the delivery company cut its profit outlook on higher costs and stalled growth in shipments. Morgan Stanley says it sees the company’s 1Q issues getting “tougher from here.” Commodity-linked oil and metal stocks led gains in premarket trade, while a slight rise in Treasury yields supported major banks. However, most sectors were nursing steep losses in recent sessions. Here are some of the biggest U.S. movers: Adobe (ADBE US) down 3.1% after 3Q update disappointed the high expectations of investors, though the broader picture still looks solid, Morgan Stanley said in a note Freeport McMoRan (FCX US), Cleveland- Cliffs (CLF US), Alcoa (AA US) and U.S. Steel (X US) up 2%-3% premarket, following the path of global peers as iron ore prices in China rallied Aethlon Medical (AEMD US) and Exela Technologies (XELAU US) advance along with other retail traders’ favorites in the U.S. premarket session. Aethlon jumps 21%; Exela up 8.3% Other so-called meme stocks also rise: ContextLogic +1%; Clover Health +0.9%; Naked Brand +0.9%; AMC +0.5% ReWalk Robotics slumps 18% in U.S. premarket trading, a day after nearly doubling in value Stitch Fix (SFIX US) rises 15.7% in light volume after the personal styling company’s 4Q profit and sales blew past analysts’ expectations Hyatt Hotels (H US) seen opening lower after the company launches a seven-million-share stock offering Summit Therapeutics (SMMT US) shares fell as much as 17% in Tuesday extended trading after it said the FDA doesn’t agree with the change to the primary endpoint that has been implemented in the ongoing Phase III Ri-CoDIFy studies when combining the studies Marin Software (MRIN US) surged more than 75% Tuesday postmarket after signing a new revenue-sharing agreement with Google to develop its enterprise technology platforms and software products The S&P 500 had fallen for 10 of the past 12 sessions since hitting a record high, as fears of an Evergrande default exacerbated seasonally weak trends and saw investors pull out of stocks trading at lofty valuations. The Nasdaq fell the least among its peers in recent sessions, as investors pivoted back into big technology names that had proven resilient through the pandemic. Focus now turns to the Fed's decision, due at 2 p.m. ET where officials are expected to signal a start to scaling down monthly bond purchases (see our preview here).  The Fed meeting comes after a period of market volatility stoked by Evergrande’s woes. China’s wider property-sector curbs are also feeding into concerns about a slowdown in the economic recovery from the pandemic. “Chair Jerome Powell could hint at the tapering approaching shortly,” said Sébastien Barbé, a strategist at Credit Agricole CIB. “However, given the current uncertainty factors (China property market, Covid, pace of global slowdown), the Fed should remain cautious when it comes to withdrawing liquidity support.” Meanwhile, confirming what Ray Dalio said that the taper will just bring more QE, Governing Council member Madis Muller said the  European Central Bank may boost its regular asset purchases once the pandemic-era emergency stimulus comes to an end. “Dovish signals could unwind some of the greenback’s gains while offering relief to stock markets,” Han Tan, chief market analyst at Exinity Group, wrote in emailed comments. A “hawkish shift would jolt markets, potentially pushing Treasury yields and the dollar past the upper bound of recent ranges, while gold and equities would sell off hunting down the next levels of support.” China avoided a major selloff as trading resumed following a holiday, after the country’s central bank boosted its injection of short-term cash into the financial system. MSCI’s Asia-Pacific index declined for a third day, dragged lower by Japan. Stocks were also higher in Europe. Basic resources - which bounced from a seven month low - and energy were among the leading gainers in the Stoxx Europe 600 index as commodity prices steadied after Beijing moved to contain fears of a spiraling debt crisis. Entain Plc rose more than 7%, extending Tuesday’s gain as it confirmed it received a takeover proposal from DraftKings Inc. Peer Flutter Entertainment Plc climbed after settling a legal dispute.  Here are some of the biggest European movers today: Entain shares jump as much as 11% after DraftKings Inc. offered to acquire the U.K. gambling company for about $22.4 billion. Vivendi rises as much as 3.1% in Paris, after Tuesday’s spinoff of Universal Music Group. Legrand climbs as much as 2.1% after Exane BNP Paribas upgrades to outperform and raises PT to a Street-high of EU135. Orpea shares falls as much as 2.9%, after delivering 1H results that Jefferies (buy) says were a “touch” below consensus. Bechtle slides as much as 5.1% after Metzler downgrades to hold from buy, saying persistent supply chain problems seem to be weighing on growth. Sopra Steria drops as much as 4.1% after Stifel initiates coverage with a sell, citing caution on company’s M&A strategy Despite the Evergrande announcement, Asian stocks headed for their longest losing streak in more than a month amid continued China-related concerns, with traders also eying policy decisions from major central banks. The MSCI Asia Pacific Index dropped as much as 0.7% in its third day of declines, with TSMC and Keyence the biggest drags. China’s CSI 300 tumbled as much as 1.9% as the local market reopened following a two-day holiday. However, the gauge came off lows after an Evergrande unit said it will make a bond interest payment and as China’s central bank boosted liquidity.  Taiwan’s equity benchmark led losses in Asia on Wednesday, dragged by TSMC after a two-day holiday, while markets in Hong Kong and South Korea were closed. Key stock gauges in Australia, Indonesia and Vietnam rose “A liquidity injection from the People’s Bank of China accompanied the Evergrande announcement, which only served to bolster sentiment further,” according to DailyFX’s Thomas Westwater and Daniel Dubrovsky. “For now, it appears that market-wide contagion risk linked to a potential Evergrande collapse is off the table.” Japanese equities fell for a second day amid global concern over China’s real-estate sector, as the Bank of Japan held its key stimulus tools in place while flagging pressures on the economy. Electronics makers were the biggest drag on the Topix, which declined 1%. Daikin and Fanuc were the largest contributors to a 0.7% loss in the Nikkei 225. The BOJ had been expected to maintain its policy levers ahead of next week’s key ruling party election. Traders are keenly awaiting the Federal Reserve’s decision due later for clues on the U.S. central banks plan for tapering stimulus. “Markets for some time have been convinced that the BOJ has reached the end of the line on normalization and will remain in a holding pattern on policy until at least April 2023 when Governor Kuroda is scheduled to leave,” UOB economist Alvin Liew wrote in a note. “Attention for the BOJ will now likely shift to dealing with the long-term climate change issues.” In the despotic lockdown regime that is Australia, the S&P/ASX 200 index rose 0.3% to close at 7,296.90, reversing an early decline in a rally led by mining and energy stocks. Banks closed lower for the fourth day in a row. Champion Iron was among the top performers after it was upgraded at Citi. IAG was among the worst performers after an earthquake caused damage to buildings in Melbourne. In New Zealand, the S&P/NZX 50 index rose 0.3% to 13,215.80 In FX, commodity currencies rallied as concerns about China Evergrande Group’s debt troubles eased as China’s central bank boosted liquidity and investors reviewed a statement from the troubled developer about an interest payment. Overnight implied volatility on the pound climbed to the highest since March ahead of Bank of England’s meeting on Thursday. The British pound weakened after Business Secretary Kwasi Kwarteng warnedthat people should prepare for longer-term high energy prices amid a natural-gas shortage that sent power costs soaring. Several U.K. power firms have stopped taking in new clients as small energy suppliers struggle to meet their previous commitments to sell supplies at lower prices. Overnight volatility in the euro rises above 10% for the first time since July ahead of the Federal Reserve’s monetary policy decision announcement. The Aussie jumped as much as 0.5% as iron-ore prices rebounded. Spot surged through option-related selling at 0.7240 before topping out near 0.7265 strikes expiring Wednesday, according to Asia- based FX traders.  Elsewhere, the yen weakened and commodity-linked currencies such as the Australian dollar pushed higher. In rates, the dollar weakened against most of its Group-of-10 peers. Treasury futures were under modest pressure in early U.S. trading, leaving yields cheaper by ~1.5bp from belly to long-end of the curve. The 10-year yield was at ~1.336% steepening the 2s10s curve by ~1bp as the front-end was little changed. Improved risk appetite weighed; with stock futures have recovering much of Tuesday’s losses as Evergrande concerns subside. Focal point for Wednesday’s session is FOMC rate decision at 2pm ET.   FOMC is expected to suggest it will start scaling back asset purchases later this year, while its quarterly summary of economic projections reveals policy makers’ expectations for the fed funds target in coming years in the dot-plot update; eurodollar positions have emerged recently that anticipate a hawkish shift Bitcoin dropped briefly below $40,000 for the first time since August amid rising criticism from regulators, before rallying as the mood in global markets improved. In commodities, Iron ore halted its collapse and metals steadied. Oil advanced for a second day. Bitcoin slid below $40,000 for the first time since early August before rebounding back above $42,000.   To the day ahead now, and the main highlight will be the aforementioned Federal Reserve decision and Chair Powell’s subsequent press conference. Otherwise on the data side, we’ll get US existing home sales for August, and the European Commission’s advance consumer confidence reading for the Euro Area in September. Market Snapshot S&P 500 futures up 0.4% to 4,362.25 STOXX Europe 600 up 0.5% to 461.19 MXAP down 0.7% to 199.29 MXAPJ down 0.4% to 638.39 Nikkei down 0.7% to 29,639.40 Topix down 1.0% to 2,043.55 Hang Seng Index up 0.5% to 24,221.54 Shanghai Composite up 0.4% to 3,628.49 Sensex little changed at 59,046.84 Australia S&P/ASX 200 up 0.3% to 7,296.94 Kospi up 0.3% to 3,140.51 Brent Futures up 1.5% to $75.47/bbl Gold spot up 0.0% to $1,775.15 U.S. Dollar Index little changed at 93.26 German 10Y yield rose 0.6 bps to -0.319% Euro little changed at $1.1725 Top Overnight News from Bloomberg What would it take to knock the U.S. recovery off course and send Federal Reserve policy makers back to the drawing board? Not much — and there are plenty of candidates to deliver the blow The European Central Bank will discuss boosting its regular asset purchases once the pandemic-era emergency stimulus comes to an end, but any such increase is uncertain, Governing Council member Madis Muller said Investors seeking hints about how Beijing plans to deal with China Evergrande Group’s debt crisis are training their cross hairs on the central bank’s liquidity management A quick look at global markets courtesy of Newsquawk Asian equity markets traded mixed as caution lingered ahead of upcoming risk events including the FOMC, with participants also digesting the latest Evergrande developments and China’s return to the market from the Mid-Autumn Festival. ASX 200 (+0.3%) was positive with the index led higher by the energy sector after a rebound in oil prices and as tech also outperformed, but with gains capped by weakness in the largest-weighted financials sector including Westpac which was forced to scrap the sale of its Pacific businesses after failing to secure regulatory approval. Nikkei 225 (-0.7%) was subdued amid the lack of fireworks from the BoJ announcement to keep policy settings unchanged and ahead of the upcoming holiday closure with the index only briefly supported by favourable currency outflows. Shanghai Comp. (+0.4%) was initially pressured on return from the long-weekend and with Hong Kong markets closed, but pared losses with risk appetite supported by news that Evergrande’s main unit Hengda Real Estate will make coupon payments due tomorrow, although other sources noted this is referring to the onshore bond payments valued around USD 36mln and that there was no mention of the offshore bond payments valued at USD 83.5mln which are also due tomorrow. Meanwhile, the PBoC facilitated liquidity through a CNY 120bln injection and provided no surprises in keeping its 1-year and 5-year Loan Prime Rates unchanged for the 17th consecutive month at 3.85% and 4.65%, respectively. Finally, 10yr JGBs were flat amid the absence of any major surprises from the BoJ policy announcement and following the choppy trade in T-notes which were briefly pressured in a knee-jerk reaction to the news that Evergrande’s unit will satisfy its coupon obligations tomorrow, but then faded most of the losses as cautiousness prevailed. Top Asian News Gold Steady as Traders Await Outcome of Fed Policy Meeting Evergrande Filing on Yuan Bond Interest Leaves Analysts Guessing Singapore Category E COE Price Rises to Highest Since April 2014 Asian Stocks Fall for Third Day as Focus Turns to Central Banks European equities (Stoxx 600 +0.5%) trade on a firmer footing in the wake of an encouraging APAC handover. Focus overnight was on the return of Chinese participants from the Mid-Autumn Festival and news that Evergrande’s main unit, Hengda Real Estate will make coupon payments due tomorrow; however, we await indication as to whether they will meet Thursday’s offshore payment deadline as well. Furthermore, the PBoC facilitated liquidity through a CNY 120bln injection whilst keeping its 1-year and 5-year Loan Prime Rates unchanged (as expected). Note, despite gaining yesterday and today, thus far, the Stoxx 600 is still lower to the tune of 0.7% on the week. Stateside, futures are also trading on a firmer footing ahead of today’s FOMC policy announcement, at which, market participants will be eyeing any clues for when the taper will begin and digesting the latest dot plot forecasts. Furthermore, the US House voted to pass the bill to fund the government through to December 3rd and suspend the debt limit to end-2022, although this will likely be blocked by Senate Republicans. Back to Europe, sectors are mostly firmer with outperformance in Basic Resources and Oil & Gas amid upside in the metals and energy complex. Elsewhere, Travel & Leisure is faring well amid further upside in Entain (+6.1%) with the Co. noting it rejected an earlier approach from DraftKings at GBP 25/shr with the new offer standing at GBP 28/shr. Additionally for the sector, Flutter Entertainment (+4.1%) are trading higher after settling the legal dispute between the Co. and Commonwealth of Kentucky. Elsewhere, in terms of deal flow, Iliad announced that it is to acquire UPC Poland for around USD 1.8bln. Top European News Energy Cost Spike Gets on EU Ministers’ Green Deal Agenda Travel Startup HomeToGo Gains in Frankfurt Debut After SPAC Deal London Stock Exchange to Shut Down CurveGlobal Exchange EU Banks Expected to Add Capital for Climate Risk, EBA Says In FX, trade remains volatile as this week’s deluge of global Central Bank policy meetings continues to unfold amidst fluctuations in broad risk sentiment from relatively pronounced aversion at various stages to a measured and cautious pick-up in appetite more recently. Hence, the tide is currently turning in favour of activity, cyclical and commodity currencies, albeit tentatively in the run up to the Fed, with the Kiwi and Aussie trying to regroup on the 0.7000 handle and 0.7350 axis against their US counterpart, and the latter also striving to shrug off negative domestic impulses like a further decline below zero in Westpac’s leading index and an earthquake near Melbourne. Next up for Nzd/Usd and Aud/Usd, beyond the FOMC, trade data and preliminary PMIs respectively. DXY/CHF/EUR/CAD - Notwithstanding the overall improvement in market tone noted above, or another major change in mood and direction, the Dollar index appears to have found a base just ahead of 93.000 and ceiling a similar distance away from 93.500, as it meanders inside those extremes awaiting US existing home sales that are scheduled for release before the main Fed events (policy statement, SEP and post-meeting press conference from chair Powell). Indeed, the Franc, Euro and Loonie have all recoiled into tighter bands vs the Greenback, between 0.9250-26, 1.1739-17 and 1.2831-1.2770, but with the former still retaining an underlying bid more evident in the Eur/Chf cross that is consolidating under 1.0850 and will undoubtedly be acknowledged by the SNB tomorrow. Meanwhile, Eur/Usd has hardly reacted to latest ECB commentary from Muller underpinning that the APP is likely to be boosted once the PEPP envelope is closed, though Usd/Cad is eyeing a firm rebound in oil prices in conjunction with hefty option expiry interest at the 1.2750 strike (1.8 bn) that may prevent the headline pair from revisiting w-t-d lows not far beneath the half round number. GBP/JPY - The major laggards, as Sterling slips slightly further beneath 1.3650 against the Buck to a fresh weekly low and Eur/Gbp rebounds from circa 0.8574 to top 0.8600 on FOMC day and T-1 to super BoE Thursday. Elsewhere, the Yen has lost momentum after peaking around 109.12 and still not garnering sufficient impetus to test 109.00 via an unchanged BoJ in terms of all policy settings and guidance, as Governor Kuroda trotted out the no hesitation to loosen the reins if required line for the umpteenth time. However, Usd/Jpy is holding around 109.61 and some distance from 1.1 bn option expiries rolling off between 109.85-110.00 at the NY cut. SCANDI/EM - Brent’s revival to Usd 75.50+/brl from sub-Usd 73.50 only yesterday has given the Nok another fillip pending confirmation of a Norges Bank hike tomorrow, while the Zar has regained some poise with the aid of firmer than forecast SA headline and core CPI alongside a degree of retracement following Wednesday’s breakdown of talks on a pay deal for engineering workers that prompted the union to call a strike from early October. Similarly, the Cnh and Cny by default have regrouped amidst reports that the CCP is finalising details to restructure Evergrande into 3 separate entities under a plan that will see the Chinese Government take control. In commodities, WTI and Brent are firmer this morning though once again fresh newsflow for the complex has been relatively slim and largely consisting of gas-related commentary; as such, the benchmarks are taking their cue from the broader risk tone (see equity section). The improvement in sentiment today has brought WTI and Brent back in proximity to being unchanged on the week so far as a whole; however, the complex will be dictated directly by the EIA weekly inventory first and then indirectly, but perhaps more pertinently, by today’s FOMC. On the weekly inventories, last nights private release was a larger than expected draw for the headline and distillate components, though the Cushing draw was beneath expectations; for today, consensus is a headline draw pf 2.44mln. Moving to metals where the return of China has seen a resurgence for base metals with LME copper posting upside of nearly 3.0%, for instance. Albeit there is no fresh newsflow for the complex as such, so it remains to be seen how lasting this resurgence will be. Finally, spot gold and silver are firmer but with the magnitude once again favouring silver over the yellow metal. US Event Calendar 10am: Aug. Existing Home Sales MoM, est. -1.7%, prior 2.0% 2pm: Sept. FOMC Rate Decision (Lower Boun, est. 0%, prior 0% DB's Jim Reid concludes the overnight wrap All eyes firmly on China this morning as it reopens following a 2-day holiday. As expected the indices there have opened lower but the scale of the declines are being softened by the PBoC increasing its short term cash injections into the economy. They’ve added a net CNY 90bn into the system. On Evergrande, we’ve also seen some positive headlines as the property developers’ main unit Hengda Real Estate Group has said that it will make coupon payment for an onshore bond tomorrow. However, the exchange filing said that the interest payment “has been resolved via negotiations with bondholders off the clearing house”. This is all a bit vague and doesn’t mention the dollar bond at this stage. Meanwhile, Bloomberg has reported that Chinese authorities have begun to lay the groundwork for a potential restructuring that could be one of the country’s biggest, assembling accounting and legal experts to examine the finances of the group. All this follows news from Bloomberg yesterday that Evergrande missed interest payments that had been due on Monday to at least two banks. In terms of markets the CSI (-1.11%), Shanghai Comp (-0.29%) and Shenzhen Comp (-0.53%) are all lower but have pared back deeper losses from the open. We did a flash poll in the CoTD yesterday (link here) and after over 700 responses in a couple of hours we found only 8% who we thought Evergrande would still be impacting financial markets significantly in a month’s time. 24% thought it would be slightly impacting. The other 68% thought limited or no impact. So the world is relatively relaxed about contagion risk for now. The bigger risk might be the knock on impact of weaker Chinese growth. So that’s one to watch even if you’re sanguine on the systemic threat. Craig Nicol in my credit team did a good note yesterday (link here) looking at the contagion risk to the broader HY market. I thought he summed it up nicely as to why we all need to care one way or another in saying that “Evergrande is the largest corporate, in the largest sector, of the second largest economy in the world”. For context AT&T is the largest corporate borrower in the US market and VW the largest in Europe. Turning back to other Asian markets now and the Nikkei (-0.65%) is down but the Hang Seng (+0.51%) and Asx (+0.58%) are up. South Korean markets continue to remain closed for a holiday. Elsewhere, yields on 10y USTs are trading flattish while futures on the S&P 500 are up +0.10% and those on the Stoxx 50 are up +0.21%. Crude oil prices are also up c.+1% this morning. In other news, the Bank of Japan policy announcement overnight was a non-event as the central bank maintained its yield curve target while keeping the policy rate and asset purchases plan unchanged. The central bank also unveiled more details of its green lending program and said that it would immediately start accepting applications and would begin making the loans in December. The relatively calm Asian session follows a stabilisation in markets yesterday following their rout on Monday as investors looked forward to the outcome of the Fed’s meeting later today. That said, it was hardly a resounding performance, with the S&P 500 unable to hold on to its intraday gains and ending just worse than unchanged after the -1.70% decline the previous day as investors remained vigilant as to the array of risks that continue to pile up on the horizon. One of these is in US politics and legislators seem no closer to resolving the various issues surrounding a potential government shutdown at the end of the month, along with a potential debt ceiling crisis in October, which is another flashing alert on the dashboard for investors that’s further contributing to weaker sentiment right now. Looking ahead now, today’s main highlight will be the latest Federal Reserve decision along with Chair Powell’s subsequent press conference, with the policy decision out at 19:00 London time. Markets have been on edge for any clues about when the Fed might begin to taper asset purchases, but concern about tapering actually being announced at this meeting has dissipated over recent weeks, particularly after the most recent nonfarm payrolls in August came in at just +235k, and the monthly CPI print also came in beneath consensus expectations for the first time since November. In terms of what to expect, our US economists write in their preview (link here) that they see the statement adopting Chair Powell’s language that a reduction in the pace of asset purchases is appropriate “this year”, so long as the economy remains on track. They see Powell maintaining optionality about the exact timing of that announcement, but they think that the message will effectively be that the bar to pushing the announcement beyond November is relatively high in the absence of any material downside surprises. This meeting also sees the release of the FOMC’s latest economic projections and the dot plot, where they expect there’ll be an upward drift in the dots that raises the number of rate hikes in 2023 to 3, followed by another 3 increases in 2024. Back to yesterday, and as mentioned US equity markets fell for a second straight day after being unable to hold on to earlier gains, with the S&P 500 slightly lower (-0.08%). High-growth industries outperformed with biotech (+0.38%) and semiconductors (+0.18%) leading the NASDAQ (+0.22%) slightly higher, however the Dow Jones (-0.15%) also struggled. Europe saw a much stronger performance though as much of the US decline came after Europe had closed. The STOXX 600 gained +1.00% to erase most of Monday’s losses, with almost every sector in the index ending the day in positive territory. With risk sentiment improving for much of the day yesterday, US Treasuries sold off slightly and by the close of trade yields on 10yr Treasuries were up +1.2bps to 1.3226%, thanks to a +1.8bps increase in real yields. However, sovereign bonds in Europe told a different story as yields on 10yr bunds (-0.3bps), OATs (-0.3bps) and BTPs (-1.9bps) moved lower. Other safe havens including gold (+0.59%) and silver (+1.02%) also benefited, but this wasn’t reflected across commodities more broadly, with Bloomberg’s Commodity Spot Index (-0.30%) losing ground for a 4th consecutive session. Democratic Party leaders plan to vote on the Senate-approved $500bn bipartisan infrastructure bill next Monday, even with no resolution to the $3.5tr budget reconciliation measure that encompasses the remainder of the Biden Administration’s economic agenda. Democrats continue to work on the reconciliation measure but have turned their attention to the debt ceiling and government funding bills.Congress has fewer than two weeks before the current budget expires – on Oct 1 – to fund the government and raise the debt ceiling. Republicans yesterday noted that the Democrats could raise the ceiling on their own through the reconciliation process, with many saying that they would not be offering their support to any funding bill. Democrats continue to push for a bipartisan bill to raise the debt ceiling, pointing to their votes during the Trump administration. If Democrats are forced to tie the debt ceiling and funding bills to budget reconciliation, it could limit how much of the $3.5 trillion bill survives the last minute negotiations between progressives and moderates. More to come over the next 10 days. Staying on the US, there was an important announcement in President Biden’s speech at the UN General Assembly, as he said that he would work with Congress to double US funding to poorer nations to deal with climate change. That comes as UK Prime Minister Johnson (with the UK hosting the COP26 summit in less than 6 weeks’ time) has been lobbying other world leaders to find the $100bn per year that developed economies pledged by 2020 to support developing countries as they reduce their emissions and deal with climate change. In Germany, there are just 4 days to go now until the federal election, and a Forsa poll out yesterday showed a slight narrowing in the race, with the centre-left SPD remaining on 25%, but the CDU/CSU gained a point on last week to 22%, which puts them within the +/- 2.5 point margin of error. That narrowing has been seen in Politico’s Poll of Polls as well, with the race having tightened from a 5-point SPD lead over the CDU/CSU last week to a 3-point one now. Turning to the pandemic, Johnson & Johnson reported that their booster shot given 8 weeks after the first offered 100% protection against severe disease, 94% protection against symptomatic Covid in the US, and 75% against symptomatic Covid globally. Speaking of boosters, Bloomberg reported that the FDA was expected to decide as soon as today on a recommendation for Pfizer’s booster vaccine. That follows an FDA advisory panel rejecting a booster for all adults last Friday, restricting the recommendation to those over-65 and other high-risk categories. Staying with the US and vaccines, President Biden announced that the US was ordering 500mn doses of the Pfizer vaccine to be exported to the rest of the world. On the data front, there were some strong US housing releases for August, with housing starts up by an annualised 1.615m (vs. 1.55m expected), and building permits up by 1.728m (vs. 1.6m expected). Separately, the OECD released their Interim Economic Outlook, which saw them upgrade their inflation expectations for the G20 this year to +3.7% (up +0.2ppts from May) and for 2022 to +3.9% (up +0.5ppts from May). Their global growth forecast saw little change at +5.7% in 2021 (down a tenth) and +4.5% for 2022 (up a tenth). To the day ahead now, and the main highlight will be the aforementioned Federal Reserve decision and Chair Powell’s subsequent press conference. Otherwise on the data side, we’ll get US existing home sales for August, and the European Commission’s advance consumer confidence reading for the Euro Area in September. Tyler Durden Wed, 09/22/2021 - 08:05.....»»

Category: blogSource: zerohedgeSep 22nd, 2021

Improve Your Business With Virtual Resources

Refining your skills while learning new ones is paramount to leading a long and successful career as a real estate agent. As the industry has embraced the virtual environment, the opportunities to tune into dozens of online training events monthly or weekly have grown dramatically in the past two years. You’ve likely seen predictions and […] The post Improve Your Business With Virtual Resources appeared first on RISMedia. Refining your skills while learning new ones is paramount to leading a long and successful career as a real estate agent. As the industry has embraced the virtual environment, the opportunities to tune into dozens of online training events monthly or weekly have grown dramatically in the past two years. You’ve likely seen predictions and forecasts for the 2022 housing market, and now is a great time to sign up and attend webinars to keep you on top of the latest trends and market shifts on the horizon. From optimizing your first 100 days in real estate to learning how to eliminate implicit bias, here are a few webinars and online training opportunities you can leverage to improve your business and brand. RISMedia’s Real Estate Rocking in the New Year As 2022 kicked into gear, RISMedia hosted its Rocking in the New Year virtual event on Jan. 6. The event brought an all-star line-up of power brokers, subject matter experts, top-producing agents and some of the industry’s best coaches and trainers to share critical advice and hands-on strategies to help agents and brokers succeed this year. Replays, including every panel and expert interview, are available here. 100 Days to Greatness The first few months can be intimidating for new agents or those looking to kickstart a real estate career. Real estate coach Brian Buffini of Buffini & Company put together 100 Days to Greatness to provide new agents with resources and strategies to set themselves up for success in the industry in the first 100 days of their careers. The step-by-step program delves into essential aspects of working in real estate, from gaining and converting referrals to building a vibrant database and establishing yourself as a “true real estate professional.” Learn more here. Fairhaven: Fair Housing Simulation Diversity, equity and inclusion (DEI) in real estate have become more than just a legal requirement under fair housing laws. They’ve been at the center of headlines, controversy and historical challenges facing aspiring homeowners among minority groups. The National Association of REALTORS® has continued to promote several DEI training programs designed to combat discrimination in the industry, including Fairhaven. The program uses the immersive power of storytelling to promote equity in the housing market. The innovative training provides customized feedback to help REALTORS® incorporate fair housing principles into their daily interactions. Learn more here Lessons in Leadership with Dermot Buffini The latest Lessons in Leadership virtual session will air on Feb. 2, marking the series’ first webinar of 2022. Buffini & Company CEO, Dermot Buffini, will host the event and provide brokers/owners with critical advice and strategies designed to take their businesses to the next level. The session will be moderated by RISMedia’s founder, president and CEO, John Featherston, and a guest speaker to be announced soon. Stay tuned for more information here. Jordan Grice is an associate online editor at RISMedia. Email him your real estate news ideas to jgrice@rismedia.com. The post Improve Your Business With Virtual Resources appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 23rd, 2022

How to Define and Achieve Wealth

Real estate brokers and agents have countless reasons for entering the profession, but at the core, they likely all have one thing in common: they seek financial stability and potential wealth. Financial stability is often table stakes for the most successful real estate professionals, but that doesn’t necessarily translate to wealth without clearly defining what […] The post How to Define and Achieve Wealth appeared first on RISMedia. Real estate brokers and agents have countless reasons for entering the profession, but at the core, they likely all have one thing in common: they seek financial stability and potential wealth. Financial stability is often table stakes for the most successful real estate professionals, but that doesn’t necessarily translate to wealth without clearly defining what that word means and having a strategy to accumulate it, according to Ben Kinney, co-founder of PLACE, Inc., a real estate technology firm. Kinney spoke at RISMedia’s Real Estate Rocking in the New Year virtual event earlier this month, which gathered some of the industry’s most respected and influential minds, who came together to share their expert insights on how to generate more success this year and beyond. During his session, Securing Your Financial Future, Kinney provided his definition of wealth and offered some salient advice on how to build wealth. “It’s the ability to do what I want, when I want, with who I want,” he said. “It’s freedom. Freedom is wealth and financial stability is that freedom.” Kinney is passionate about the topic because he recognizes how financial problems can impact an individual’s health and wellbeing, so to turn that passion into actionable advice, he offered these four tips to get started: “It’s not rocket science,” Kinney admitted, but in order to increase net worth you need to spend less than you earn. Whatever is left over should be first used to pay off debts and liabilities and then you should invest the rest. Investing is the key driver of wealth, but Kinney suggested it should be done inside five major buckets, where 20% of your excess income is distributed equally. Bucket 1: “Cash is king,” he said. Saving 20% of your excess income as cash can be used for unexpected emergencies and give you additional spending leverage when needed. Bucket 2: Financial instruments including your retirement account and IRAs, both of which Kinney suggested should be maxed out pre-tax, if possible. Then look to other key financial instruments, such as stocks, bonds, etc. Bucket 3: Real estate, “It’s what we do every day! You have a competitive advantage,” he said. Kinney advised to set a goal to buy five houses in 10 years and it could generate as much as $8 million in return in 30 years. Bucket 4: Invest in business, either your own, a friend’s or a family member’s. Bucket 5: This last one is up to you. Whether it’s paying off long-term debts, donating to charities, buying collectibles or investing in precious metals or, of course, crypto currencies, use that remaining 20% to help further diversify your investment portfolio. Become a student of wealth. Kinney recommended reading up on investing and wealth management and listening to experts who have proven track records. Set annual goals. Ultimately this is what will lead you to becoming wealthy. And, if you choose, allow you to retire when you want. Whatever the goals, if you outline them on an annual basis and stay laser-focused on achieving them, you will stay on track to achieving your definition of wealth. Missed the event? Replays including every panel and expert interview are available here. Caysey Welton is Content Director at RISMedia. Email him your real estate news ideas cwelton@rismedia.com. The post How to Define and Achieve Wealth appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 21st, 2022

Commodities" King Sees "Structural Supply-Side Commodity Inflation" Sending Oil To $200

Commodities' King Sees "Structural Supply-Side Commodity Inflation" Sending Oil To $200 As Omicron anxiety fades (and even morphs into talk of the end of the pandemic phase of COVID), oil demand fears have faded and crude prices have ripped back higher, erasing any losses enabled by Biden's SPR Release headlines also... And pushing WTI back up to its highest levels since 2014... So where does oil go next? Oil to $100 Easy, Putin thinks so! It is "quite possible" that the WTI Crude oil prices reach $100 per barrel in light of growing global demand for energy commodities, Russian President Vladimir Putin said on a CNBC panel at the Russian Energy Week in October. Asked by CNBC’s Hadley Gamble whether the US benchmark could hit $100 a barrel, Putin replied "That is quite possible." Additionally, Trafigura, one of the world’s largest independent oil traders, affirmed Putin's thinking, noting that recovering global oil demand could send oil prices to $100 a barrel, despite COVID challenges to demand. Oil to $200? Building on that theme, Russian and OPEC ministers warned last year that if the 'Net Zero By 2050' plan is enacted, "we'll see $200 oil." If the world were to follow the International Energy Agency’s controversial road map, which said investment in new fields would have to stop immediately to achieve net-zero carbon emissions by 2050, "the price for oil will go to, what, $200? Gas prices will skyrocket," Russian Deputy Prime Minister Alexander Novak said. The "euphoria" around the transition to clean energy is "dangerous," Qatar’s Energy Minister Saad Sherida Al Kaabi said at the St Petersburg International Economic Forum in Russia in June. And after a magnificent year in 2021, commodities trader Doug King, who manages the $244 million Merchant Commodity Fund, said oil could soon hit $100 and even $200 over the next five years due to a lack of exploration and investment to maintain existing supplies. “We believe in structural supply-side commodity inflation that most will not have ever seen -- the highest since the 1970s,” he said in an interview. “Only OPEC will react to price metrics and they are undershooting every month.” As Bloomberg reports, OPEC and its partners are gradually increasing crude output after making deep cuts of almost 10 million barrels a day in 2020 when the pandemic first struck. While the group is meant to be pumping an extra 400,000 barrels a day each month, many of its members are struggling to reach their quotas. “In practice, a lot less oil is making its way to the market,” the Merchant Commodity Fund said in its investor letter. “Its members are simply unable to return to pre-covid levels of output. This is all down to a lack of investment.” Within the 23-nation OPEC+, the “only real spare capacity” resides in Saudi Arabia, the United Arab Emirates and Kuwait, according to the letter. Even Russia, which leads OPEC+ along with the Saudis, can’t pump much more. “It’s no state secret that Russia is at, or very near, its maximum,” the letter said. “If not next month, then certainly by April it may not have any more barrels to give.” Goldman Sachs is “extremely bullish,” citing low spare capacity among oil producers And in fact, as we detailed previously, a number of traders are already placing bets on oil hitting $100... And even $200... These are bets that WTI will hit $200 by Dec 2022... “I haven’t seen crazy strikes like this in a long time,” said Mark Benigno, co-director of energy trading at StoneX Group Inc., referring to the price in the underlying asset at which the options become exercisable. “The momentum and trend is higher.” And finally, what about Oil to $300? It's possible... as we detailed previously, whether you think global warming is a hoax and no technology has done more to uplift billions of people out of abject poverty than the harnessing of fossil fuels, or you think the burning of fossil fuels is irreversibly destroying the planet and urgent action to halt their use should be the top priority of humankind, or even if you think both of these things, this article is for you. I can assure all sides the following: unless something substantial changes – and soon – the price of oil is going way higher... just ask NatGas buyers in Europe. On an energy-contained-in-oil-equivalency basis, natural gas prices reached the following levels in February: SoCal Citygate: $835 per barrel Chicago Citygate: $752 per barrel Houston Ship Channel: $2,320 per barrel Waha: $1,196 per barrel OGT: $6,919 per barrel Henry Hub: $137 per barrel Agua Dulce: $528 per barrel Sure, the price of natural gas didn’t stay there, but it went there. I use this extreme example to illustrate an important point. Fossil fuels are hugely inelastic commodities. Shortages send prices soaring because they are needed and there are not yet fungible substitutes. Society might hate fossil fuels, it might even hate them for very good reasons, but society is trapped in its need for fossil fuels, at least for the time being. Indeed with quotes like these... “We see a shift from stigmatization toward criminalization of investing in higher oil production.” – Bob McNally, former White House official, “This Time Is Different” Bloomberg May 30, 2021 “From today, halt all investment in new fossil fuel supply projects and make no further final investment decisions for new unabated coal plants.” – IEA Roadmap to Net Zero by 2050 Perhaps $100, $200, $300 crude is not so far away. There is at least one person who is hoping that Doug King is wrong as we wonder just what would happen to the president's approval rating if Gas prices at the pump reached $4 (at $100 WTI) or $7 a gallon (at $200 WTI)... Source: Bloomberg Better start making some more calls Joe? Tyler Durden Fri, 01/14/2022 - 13:32.....»»

Category: blogSource: zerohedgeJan 14th, 2022

Mortgage Rates Spike to Highest Level Since March 2020

Elevated inflation and the concerns over how federal officials intend to address it led to a significant surge in mortgage rates across the board, according to recent reports from Freddie Mac. According to the agency’s Primary Mortgage Market Survey® (PMMS®), the 30-year fixed mortgage rate averaged 3.45% for the week ending Jan. 13, climbing 0.7 […] The post Mortgage Rates Spike to Highest Level Since March 2020 appeared first on RISMedia. Elevated inflation and the concerns over how federal officials intend to address it led to a significant surge in mortgage rates across the board, according to recent reports from Freddie Mac. According to the agency’s Primary Mortgage Market Survey® (PMMS®), the 30-year fixed mortgage rate averaged 3.45% for the week ending Jan. 13, climbing 0.7 points from a week earlier. Mortgage Details 30-year fixed-rate mortgage averaged 3.45% with an average of 0.7 point for the week—up from last week when it averaged 3.22%. Last year the 30-year FRM averaged 2.79%. 15-year fixed-rate mortgage averaged 2.62% with an average of 0.7 point, up from last week when it averaged 2.43%. Last year the 15-year FRM averaged 2.23%. 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.57% with an average of 0.3 point, up from last week when it averaged 2.4%. Last year the 5-year ARM averaged 3.12%. The Takeaway “Mortgage rates rose across all mortgage loan types, with the 30-year fixed-rate increasing by almost a quarter of a percent from last week. This was driven by the prospect of a faster than expected tightening of monetary policy in response to continued inflation exacerbated by uncertainty in labor and supply chains. “The rise in mortgage rates so far this year has not yet affected purchase demand, but given the fast pace of home price growth, it will likely dampen demand in the near future.” —Sam Khater, Freddie Mac’s chief economist. “The Freddie Mac fixed rate for a 30-year loan shot up this week, with a 23 basis point jump to 3.45%, the highest rate since March 2020, riding a strong inflationary wave and following the surge in the 10-year Treasury. Investors took note of the acceleration in consumer prices, which rose at the fastest pace in forty years in December. In addition, the mild impact of the omicron wave, despite the high number of cases, points toward a brighter post-pandemic horizon, a sentiment that underpins a more bullish outlook on the economy. “Real estate markets are unseasonably active this January, as many buyers respond to the signals of rising rates and prices by seeking to find the right home and lock in a fixed mortgage payment. At today’s rate, buyers of a median-priced home are paying about $219 more per month than a year ago, adding over $2,600 to their yearly housing costs. This amounts to more than half of a household’s food-at-home budget for the year. With prices for most consumer goods and services increasing, buyers are feeling the pinch on their wallets. Affordability continues to be a central challenge for this year’s first-time buyers. The silver lining is that a strong preference for remote work has led to an increasing number of companies moving to hybrid work models for 2022. With more flexibility, first-time buyers have the opportunity to seek their ideal home in dynamic, smaller markets, with strong economies, high quality of life and more affordable housing.” — George Ratiu, manager of economic research at Realtor.com Jordan Grice is RISMedia’s associate online editor. Email him your real estate news ideas to jgrice@rismedia.com. The post Mortgage Rates Spike to Highest Level Since March 2020 appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 13th, 2022

The New Rules of Safety: How to Protect Yourself, Your Clients and Your Business

For real estate agents and their clients, safety should be a top priority. From protecting yourself during in-person showings to keeping your clients’ information safe on the information highway, learning, understanding and practicing the new rules of safety will ensure success in your real estate business. During RISMedia’s Real Estate’s Rocking in the New Year […] The post The New Rules of Safety: How to Protect Yourself, Your Clients and Your Business appeared first on RISMedia. For real estate agents and their clients, safety should be a top priority. From protecting yourself during in-person showings to keeping your clients’ information safe on the information highway, learning, understanding and practicing the new rules of safety will ensure success in your real estate business. During RISMedia’s Real Estate’s Rocking in the New Year 2022, Tracey “The Safety Lady” Hawkins, kicked off the virtual event by laying out safety rules for protecting not just the agent, but their clients and their business, as well. “The number one thing that I teach real estate agents is that you must take safety education seriously,” said Hawkins, founder of Safety and Security Source. According to the U.S. Department of Labor, real estate sales and leasing is considered a high-risk, hazardous occupation. However, by learning more about REALTOR® safety and training with the proper tools and information, agents can reduce the risks associated with their jobs. “Safety education should be done by a true subject matter expert,” says Hawkins. “It’s too easy to take whatever is available. You need someone who has walked the walk and who has done the job.” As a former real estate agent turned safety expert, Hawkins offers tools, training and tips that agents can rely on to keep their business, clients and themselves safe and protected at all times. During her panel, The New Rules of Safety: How to Protect Yourself, Your Clients and Your Business, Hawkins shared some of her best advice for agents. For many real estate agents, making money is a top priority. But to make significant profits, training is vital. And the same goes for safety training. As we transition into a new year, as well as navigate the “new normal,” agents need to understand the shift in safety practices. Ensuring Safety in a Virtual World The real estate industry has embraced virtual business, from hosting video tours to utilizing new technology to showcase listings and complete the transaction process. But with new technology comes new challenges. “When it is time to do an open house, a virtual open house is by far not only the safer way to do an open house, because you are safe, there is no public and there is no danger. But it’s also a more productive way to do an open house,” said Hawkins. “There are more eyes on an open house that could possibly walk through the door.” Though virtual open houses may reduce the risk of physical danger, there are still some things you need to remember. Hawkins explained that even when you are doing a virtual tour, even live, you need to restrict information, such as the address. Simply offer interested parties your contact information to set up an in-person tour or more information. This will not only ensure both agent and client safety, but help with lead generation. Safety Training 101 “This is your life that we’re talking about,” says Hawkins. “So make safety training a regular part of your training.” To ensure that you and your clients make it home safely, training should be a part of your business plan. Hawkins believes that at least once per quarter, agents and teams should hold a safety class, ranging from a class on safe practices, social media safety training or hands-on self-defense. In addition to safety training for agents, it is important to be prepared to share safety tips with your clients, especially your sellers. From important documents, such as bank statements and medical information, to medications and valuables, be sure to inform your sellers to hide these items away before showing. This will highlight that as their agent, your focus is not on the money, rather how they can stay safe while strangers are walking through their home. When it comes to your buyer, especially in a world dominated by the COVID-19 pandemic, it is important that you showcase your expertise. By offering resources to them to ensure they are looking in safe neighborhoods, giving health and safety guidelines for visiting for sale homes and providing statistics, you are giving them the tools they need to make the right choice in an agent and a homebuying plan. Lessons Learned “Male real estate agents have been the most recent victims of crime. They have been murdered, have had their cars stolen, been physically assaulted and even kidnapped,” says Hawkins. “Whenever I hear male agents say ‘this topic is just for the female agents,’ I want you to know that male agents need to be safe as well.” Read more: Are Male Agents in Danger? Lessons From Crime Against Agents Most crimes against real estate agents can be prevented, however, many seem to happen over and over again. By understanding the potential risks, you can ensure that they never happen to you. With the right training from the best resources available, no matter your gender, experience or location, you can reduce and remove potential danger from your day-to-day efforts. “You need to rely on your number one safety tool to keep you safe,” Hawkins said. “And that is your gut, intuition, instincts, fight or flight and I have even heard it called your spidey sense. Whatever you call it, your body tells you when there is danger, and you need to listen to it.” Missed the event? Replays including every panel and expert interview are available here. Paige Brown is RISMedia’s content editor. Email her your real estate news ideas to pbrown@rismedia.com. The post The New Rules of Safety: How to Protect Yourself, Your Clients and Your Business appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 13th, 2022

With a Bang: RISMedia Kicks Off 2022 With Expert Panels, Predictions

Covering everything from the complex technical aspects of the new MLS changes to the power of women’s leadership in the industry, RISMedia’s all-star lineup of trendsetters and influencers at RISMedia’s Real Estate Rocking in the New Year wasted no time in delving into the most pertinent questions facing real estate professionals in 2022, providing a […] The post With a Bang: RISMedia Kicks Off 2022 With Expert Panels, Predictions appeared first on RISMedia. Covering everything from the complex technical aspects of the new MLS changes to the power of women’s leadership in the industry, RISMedia’s all-star lineup of trendsetters and influencers at RISMedia’s Real Estate Rocking in the New Year wasted no time in delving into the most pertinent questions facing real estate professionals in 2022, providing a road map and plenty of poignant advice to guide a successful path through the new year. “Our collective goal is to help all of you enter 2022 better equipped to tackle today’s issues and help you improve your value proposition,” said John Featherston, RISMedia’s Founder, CEO & Publisher. “Buyers and sellers need your services now more than ever to achieve their real estate goals and objectives. We hope today helps you start off your year stronger than ever before.” In the wake of the global upheaval over the past couple years, mapping out the increasingly unknown challenges of 2022 seemed more important than ever, and panelists started off with goals and predictions for what the next 12 months will bring, as the industry hopes to see the continuation of a strong housing market, along with accelerating trends around technology and equity. Chief Economist for the National Association of REALTORS®, Lawrence Yun, laid out a scenario where pandemic-driven demand and rising rents would offset other macroeconomic impediments, resulting in a relatively strong real estate market. “There is an eagerness for home buying especially in a rising-rent situation, and REALTORS®, you should be positioned to help out,” he said. Sue Yannacone, President & CEO of Realogy Franchises, said the industry should focus on the “growth opportunities” that materialized during the pandemic, both in the realm of technology as well as geographically and demographically. “Millennials are really finally en masse entering the home buying age, if you will,” Yannacone pointed out. “And the transfer of wealth that we’ve been talking about for quite some time now is beginning to occur. You couple that with the fact that we have people rethinking their lifestyle and rethinking what home means to them… companies continuing to allow work-from-home, work-from-anywhere policies are all going to continue to fuel the demand that we’re seeing.” With consumers seeing the possibilities in digital closing, virtual tours and speedier transactions, Yannacone urged the thousands of people streaming the event to lean into the changes, and find more ways to augment their services with tech “in a way that helps us engage with our consumer more.” She also highlighted disparities in home ownership for Black and Hispanic families, saying that REALTORS® can make a difference here. “We have an opportunity to serve these communities better, and it’s a real ongoing priority for me and I’m sure for many,” she said. Panels Though billed as an opening overview of the larger “Rocking in the New Year” event, experts had a chance to get into the weeds on a couple key issues. Candace Adams, President & CEO of Berkshire Hathaway HomeServices New England Properties/Westchester Properties/New York Properties/Hudson Valley Properties, moderated a powerful discussion on the state of women’s leadership, with participants seeing both progress and new pitfalls appearing in the last couple years. “I think a lot of what the pandemic did was accelerate a change,” said Cory Vasquez, chief marketing officer for Realty ONE Group. “I think that we saw some strength that women bring to the table really contribute to helping people through job changes, work changes, schools changes, life changes. Women tend to be resilient; we love to self-develop.” Broadly, panelists generally agreed that women had seen more opportunities at the high leadership levels than in year’s past, fueled by changing attitudes and priorities. Flexibility, empathy, multitasking and resilience were all qualities that allowed women to rise to the top during the pandemic, and which many companies and organizations could benefit from, they said. “There are numerous research studies that show women are better leaders especially in a crisis, which is what we are dealing with the last couple years,” said Tina Lapp, President of Colibri Real Estate. At the same time, women have fallen out of the broader workforce much faster than men and have often been asked to multitask with things like remote schooling. Michelle Harrington, CEO & Broker of Record for First Team Real Estate, pointed out the pandemic significantly hampered efforts to achieve gender equality, with the World Economic Forum predicting it would take 30 more years to reach this goal due to Covid. At the same time, Harrington urged women to let their own abilities and talents shine and show the world what they can do, rather than waiting around for government action. “You really need to believe in yourself. Women are awesome. We don’t need affirmative action, we don’t need someone to appoint us to a board because a law says it,” she said. “Don’t try to be a man, we’re not men. We can do things our own way,” Adams affirmed. “And that’s a shift from maybe a decade ago.” A second panel sank its teeth into an important regulatory and technical issue—the Multiple Listing Service (MLS). Vice President of MLS & Industry Relations for HomeServices of America, Jon Coile detailed a half-dozen recent policy changes likely to affect brokerages, as well as previewed a new environment for MLS owners and users in 2022. “We should be treating organized real estate as if it were part of the solution—we’re all in this together,” he said. Statewide standards for MLSs are currently being considered in the industry, he said, and MLSs are now required to tweak their attribution and provide back-office feeds for brokerages. Rebecca Jensen, President & CEO of Midwest Real Estate Data added that an overall standardization and collaborative attitude, lauding large MLSs and group efforts by smaller ones to invest in technology and share best practices. “When we’re talking about a shift in both the business model and the money, I think you’re going to see that not just in the brokerage community but in the MLS community,” Jensen predicted. “We’ve talked about consolidation of MLSs for years now, but now it is consolidation of services, and it is teaming up with different industry players to really deliver what it is that different brokerages need.” Across the broader landscape of things likely to affect the industry, President of the Houston Association of REALTORS®, Bob Hale called out climate change as something “affecting everything from California to Florida to Texas to Kentucky.” Also, Executive Director of the Real Estate Services Providers Council Ken Trepeta, looked at regulatory action coming from the Biden administration. “I think we’re going to see activity out of the Consumer Financial Protection Bureau and Housing and Urban Development,” he said “There is going to be a lot of focus on fair housing, fair lending.” Regardless of all the unknowns and possibilities, staying up to date with news and developments will certainly remain vital, as 2022 promises to offer just as much change and challenge as last year. Missed the event? Replays including every panel and expert interview are available here. Jesse Williams is RISMedia’s associate online editor. Email him your real estate news ideas to jwilliams@rismedia.com. The post With a Bang: RISMedia Kicks Off 2022 With Expert Panels, Predictions appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 13th, 2022

Annual Home Price Growth Accelerates in November

Prospective homebuyers felt the strain of growing affordability hurdles as home prices maintained their upward trajectory in November, according to recent data from CoreLogic. The organization released its CoreLogic Home Price Index (HPI™) and HPI Forecast™ on Jan. 4, which found that home prices climbed 18.1% in November 2021 compared to the same period in […] The post Annual Home Price Growth Accelerates in November appeared first on RISMedia. Prospective homebuyers felt the strain of growing affordability hurdles as home prices maintained their upward trajectory in November, according to recent data from CoreLogic. The organization released its CoreLogic Home Price Index (HPI) and HPI Forecast on Jan. 4, which found that home prices climbed 18.1% in November 2021 compared to the same period in 2020. Monthly price appreciation also ticked up by 1.3% from October to November last year. Despite the surging price gains in 2021, experts suggest that home price appreciation will slow to a 2.8% increase by November 2022. The takeaways: Prices for detached properties saw a YoY increase of 19.4%, while attached properties increased by 13.6%. Naples, Florida, and Twin Falls, Idaho were the top two markets with the highest YoY price increases at 36.7% and 33.3%, respectively. The Southeast and Mountain West regions dominated the top spot on the state level, with Arizona leading the way with a 28.6% increase in price. Florida and Idaho ranked second and third place with 25.8% and 25.5% increases. What it means: The housing market stayed busy throughout 2021 as the supply-demand imbalance and historically low mortgage rates left buyers frenzied for a limited inventory nationwide. While the frenzy was a boon for sellers who reaped the benefits from a record-breaking year for U.S. home price growth, the hot housing market will continue to exacerbate ongoing affordability challenges for prospective buyers in 2022, according to CoreLogic experts. “Over the past year, we have seen one of the most robust seller’s markets in a generation,” said Frank Martell, president and CEO of CoreLogic, in a statement. “While increased interest rates may help cool down home-buying activity, we expect 2022 to be another strong year with continuing upward price growth.” Though home price growth remains at historic highs, CoreLogic expects things to slow over the next year, especially as economic growth and inflation are slated to apply upward pressure on mortgage rates, which will further erode affordability. “Interest rates on 30-year fixed-rate mortgages averaged a record low of 2.96% during 2021, helping to keep monthly payments low in the face of record-high home prices,” said Dr. Frank Nothaft, chief economist at CoreLogic, in a statement. “However, the Federal Reserve appears poised to allow interest rates to rise in 2022. Higher rates will intensify buyer affordability challenges, especially in overvalued local markets.” Jordan Grice is RISMedia’s associate online editor. Email him your real estate news to jgrice@rismedia.com. The post Annual Home Price Growth Accelerates in November appeared first on RISMedia......»»

Category: realestateSource: rismediaJan 4th, 2022

2021 Greatest Hits: The Most Popular Articles Of The Past Year And A Look Ahead

2021 Greatest Hits: The Most Popular Articles Of The Past Year And A Look Ahead One year ago, when looking at the 20 most popular stories of 2020, we said that the year would be a very tough act to follow as there "could not have been more regime shifts, volatility moments, and memes than 2020." And yet despite the exceedingly high bar for 2021, the year did not disappoint and proved to be a successful contender, and if judging by the sheer breadth of narratives, stories, surprises, plot twists and unexpected developments, 2021 was even more memorable and event-filled than 2020. Where does one start? While covid was the story of 2020, the pandemic that emerged out of a (Fauci-funded) genetic lab team in Wuhan, China dominated newsflow, politics and capital markets for the second year in a row. And while the biggest plot twist of 2020 was Biden's victory over Trump in the presidential election (it took the pandemic lockdowns and mail-in ballots to hand the outcome to Biden), largely thanks to Covid, Biden failed to hold to his biggest presidential promise of defeating covid, and not only did he admit in late 2021 that there is "no Federal solution" to covid waving a white flag of surrender less than a year into his presidency, but following the recent emergence of the Xi, pardon Omicron variant, the number of covid cases in the US has just shattered all records. The silver lining is not only that deaths and hospitalizations have failed to follow the number of cases, but that the scaremongering narrative itself is starting to melt in response to growing grassroots discontent with vaccine after vaccine and booster after booster, which by now it is clear, do nothing to contain the pandemic. And now that it is clear that omicron is about as mild as a moderate case of the flu, the hope has finally emerged that this latest strain will finally kill off the pandemic as it becomes the dominant, rapidly-spreading variant, leading to worldwide herd immunity thanks to the immune system's natural response. Yes, it may mean billions less in revenue for Pfizer and Moderna, but it will be a colossal victory for the entire world. The second biggest story of 2021 was undoubtedly the scourge of soaring inflation, which contrary to macrotourist predictions that it would prove "transitory", refused to do so and kept rising, and rising, and rising, until it hit levels not seen since the Volcker galloping inflation days of the 1980s. The only difference of course is that back then, the Fed Funds rate hit 20%. Now it is at 0%, and any attempts to hike aggressively will lead to a horrific market crash, something the Fed knows very well. Whether this was due to supply-chain blockages and a lack of goods and services pushing prices higher, or due to massive stimulus pushing demand for goods - and also prices - higher, or simply the result of a record injection of central bank liquidity into the system, is irrelevant but what does matter is that it got so bad that even Biden, facing a mauling for his Democratic party in next year's midterm elections, freaked out about soaring prices and pushed hard to lower the price of gasoline, ordering releases from the US Strategic Petroleum Reserve and vowing to punish energy companies that dare to make a profit, while ordering Powell to contain the surge in prices even if means the market is hit. Unfortunately for Biden, the market will be hit even as inflation still remain red hot for much of the coming year. And speaking of markets, while 2022 may be a year when the piper finally gets paid, 2021 was yet another blockbuster year for risk assets, largely on the back of the continued global response to the 2020 covid pandemic, when as we wrote last year, we saw "the official arrival of global Helicopter Money, tens of trillions in fiscal and monetary stimulus, an overhaul of the global economy punctuated by an unprecedented explosion in world debt, an Orwellian crackdown on civil liberties by governments everywhere, and ultimately set the scene for what even the World Economic Forum called simply "The Great Reset." Yes, the staggering liquidity injections that started in 2020, continued throughout 2021 and the final tally is that after $3 trillion in emergency liquidity injections in the immediate aftermath of the pandemic to stabilize the world, the Fed injected almost $2 trillion in the subsequent period, of which $1.5 trillion in 2021, a year where economists were "puzzled" why inflation was soaring. This, of course, excludes the tens of trillions of monetary stimulus injected by other central banks as well as the boundless fiscal stimulus that was greenlighted with the launch of helicopter money (i.e., MMT) in 2020. It's also why with inflation running red hot and real rates the lowest they have ever been, everyone was forced to rush into the "safety" of stocks (or stonks as they came to be known among GenZ), and why after last year's torrid stock market returns, the S&P rose another 27% in 2021 and up a staggering 114% from the March 2020 lows, in the process trouncing all previous mega-rallies (including those in 1929, 1938, 1974 and 2009)... ... making this the third consecutive year of double-digit returns. This reminds us of something we said last year: "it's almost as if the world's richest asset owners requested the covid pandemic." A year later, we got confirmation for this rhetorical statement, when we calculated that in the 18 months since the covid pandemic, the richest 1% of US society have seen their net worth increase by over $30 trillion. As a result, the US is now officially a banana republic where the middle 60% of US households by income - a measure economists use as a definition of the middle class - saw their combined assets drop from 26.7% to 26.6% of national wealth as of June, the lowest in Federal Reserve data, while for the first time the super rich had a bigger share, at 27%. Yes, the 1% now own more wealth than the entire US middle class, a definition traditionally reserve for kleptocracies and despotic African banana republics. It wasn't just the rich, however: politicians the world over would benefit from the transition from QE to outright helicopter money and MMT which made the over monetization of deficits widely accepted in the blink of an eye. The common theme here is simple: no matter what happens, capital markets can never again be allowed to drop, regardless of the cost or how much more debt has to be incurred. Indeed, as we look back at the news barrage over the past year, and past decade for that matter, the one thing that becomes especially clear amid the constant din of markets, of politics, of social upheaval and geopolitical strife - and now pandemics -  in fact a world that is so flooded with constant conflicting newsflow and changing storylines that many now say it has become virtually impossible to even try to predict the future, is that despite the people's desire for change, for something original and untried, the world's established forces will not allow it and will fight to preserve the broken status quo at any price - even global coordinated shutdowns - which is perhaps why it always boils down to one thing - capital markets, that bedrock of Western capitalism and the "modern way of life", where control, even if it means central planning the likes of which have not been seen since the days of the USSR, and an upward trajectory must be preserved at all costs, as the alternative is a global, socio-economic collapse. And since it is the daily gyrations of stocks that sway popular moods the interplay between capital markets and politics has never been more profound or more consequential. The more powerful message here is the implicit realization and admission by politicians, not just Trump who had a penchant of tweeting about the S&P every time it rose, but also his peers on both sides of the aisle, that the stock market is now seen as the consummate barometer of one's political achievements and approval. Which is also why capital markets are now, more than ever, a political tool whose purpose is no longer to distribute capital efficiently and discount the future, but to manipulate voter sentiments far more efficiently than any fake Russian election interference attempt ever could. Which brings us back to 2021 and the past decade, which was best summarized by a recent Bill Blain article who said that "the last 10-years has been a story of massive central banking distortion to address the 2008 crisis. Now central banks face the consequences and are trapped. The distortion can’t go uncorrected indefinitely." He is right: the distortion will eventually collapse especially if the Fed follows through with its attempt rate hikes some time in mid-2020, but so far the establishment and the "top 1%" have been successful - perhaps the correct word is lucky - in preserving the value of risk assets: on the back of the Fed's firehose of liquidity the S&P500 returned an impressive 27% in 2021, following a 15.5% return in 2020 and 28.50% in 2019. It did so by staging the greatest rally off all time from the March lows, surpassing all of the 4 greatest rallies off the lows of the past century (1929,1938, 1974, and 2009). Yet this continued can-kicking by the establishment - all of which was made possible by the covid pandemic and lockdowns which served as an all too convenient scapegoat for the unprecedented response that served to propel risk assets (and fiat alternatives such as gold and bitcoin) to all time highs - has come with a price... and an increasingly higher price in fact. As even Bank of America CIO Michael Hartnett admits, Fed's response to the the pandemic "worsened inequality" as the value of financial assets - Wall Street -  relative to economy - Main Street - hit all-time high of 6.3x. And while the Fed was the dynamo that has propelled markets higher ever since the Lehman collapse, last year certainly had its share of breakout moments. Here is a sampling. Gamestop and the emergence of meme stonks and the daytrading apes: In January markets were hypnotized by the massive trading volumes, rolling short squeezes and surging share prices of unremarkable established companies such as consoles retailer GameStop and cinema chain AMC and various other micro and midcap names. What began as a discussion on untapped value at GameStop on Reddit months earlier by Keith Gill, better known as Roaring Kitty, morphed into a hedge fund-orchestrated, crowdsourced effort to squeeze out the short position held by a hedge fund, Melvin Capital. The momentum flooded through the retail market, where daytraders shunned stocks and bought massive out of the money calls, sparking rampant "gamma squeezes" in the process forcing some brokers to curb trading. Robinhood, a popular broker for day traders and Citadel's most lucrative "subsidiary", required a cash injection to withstand the demands placed on it by its clearing house. The company IPOed later in the year only to see its shares collapse as it emerged its business model was disappointing hollow absent constant retail euphoria. Ultimately, the market received a crash course in the power of retail investors on a mission. Ultimately, "retail favorite" stocks ended the year on a subdued note as the trading frenzy from earlier in the year petered out, but despite underperforming the S&P500, retail traders still outperformed hedge funds by more than 100%. Failed seven-year Treasury auction:  Whereas auctions of seven-year US government debt generally spark interest only among specialists, on on February 25 2021, one such typically boring event sparked shockwaves across financial markets, as the weakest demand on record hit prices across the whole spectrum of Treasury bonds. The five-, seven- and 10-year notes all fell sharply in price. Researchers at the Federal Reserve called it a “flash event”; we called it a "catastrophic, tailing" auction, the closest thing the US has had to a failed Trasury auction. The flare-up, as the FT put it, reflects one of the most pressing investor concerns of the year: inflation. At the time, fund managers were just starting to realize that consumer price rises were back with a vengeance — a huge threat to the bond market which still remembers the dire days of the Volcker Fed when inflation was about as high as it is today but the 30Y was trading around 15%. The February auaction also illustrated that the world’s most important market was far less liquid and not as structurally robust as investors had hoped. It was an extreme example of a long-running issue: since the financial crisis the traditional providers of liquidity, a group of 24 Wall Street banks, have pulled back because of higher costs associated with post-2008 capital requirements, while leaving liquidity provision to the Fed. Those banks, in their reduced role, as well as the hedge funds and high-frequency traders that have stepped into their place, have tended to withdraw in moments of market volatility. Needless to say, with the Fed now tapering its record QE, we expect many more such "flash" episodes in the bond market in the year ahead. The arch ego of Archegos: In March 2021 several banks received a brutal reminder that some of family offices, which manage some $6 trillion in wealth of successful billionaires and entrepreneurs and which have minimal reporting requirements, take risks that would make the most serrated hedge fund manager wince, when Bill Hwang’s Archegos Capital Management imploded in spectacular style. As we learned in late March when several high-flying stocks suddenly collapsed, Hwang - a former protege of fabled hedge fund group Tiger Management - had built up a vast pile of leverage using opaque Total Return Swaps with a handful of banks to boost bets on a small number of stocks (the same banks were quite happy to help despite Hwang’s having been barred from US markets in 2013 over allegations of an insider-trading scheme, as he paid generously for the privilege of borrowing the banks' balance sheet). When one of Archegos more recent bets, ViacomCBS, suddenly tumbled it set off a liquidation cascade that left banks including Credit Suisse and Nomura with billions of dollars in losses. Conveniently, as the FT noted, the damage was contained to the banks rather than leaking across financial markets, but the episode sparked a rethink among banks over how to treat these clients and how much leverage to extend. The second coming of cryptos: After hitting an all time high in late 2017 and subsequently slumping into a "crypto winter", cryptocurrencies enjoyed a huge rebound in early 2021 which sent their prices soaring amid fears of galloping inflation (as shown below, and contrary to some financial speculation, the crypto space has traditionally been a hedge either to too much liquidity or a hedge to too much inflation). As a result, Bitcoin rose to a series of new record highs that culminated at just below $62,000, nearly three times higher than their previous all time high. But the smooth ride came to a halt in May when China’s crackdown on the cryptocurrency and its production, or “mining”, sparked the first serious crash of 2021. The price of bitcoin then collapsed as much as 30% on May 19, hitting a low of $30,000 amid a liquidation of levered positions in chaotic trading conditions following a warning from Chinese authorities of tighter curbs ahead. A public acceptance by Tesla chief and crypto cheerleader Elon Musk of the industry’s environmental impact added to the declines. However, as with all previous crypto crashes, this one too proved transitory, and prices resumed their upward trajectory in late September when investors started to price in the launch of futures-based bitcoin exchange traded funds in the US. The launch of these contracts subsequently pushed bitcoin to a new all-time high in early November before prices stumbled again in early December, this time due to a rise in institutional ownership when an overall drop in the market dragged down cryptos as well. That demonstrated the growing linkage between Wall Street and cryptocurrencies, due to the growing sway of large investors in digital markets. China's common prosperity crash: China’s education and tech sectors were one of the perennial Wall Street darlings. Companies such as New Oriental, TAL Education as well as Alibaba and Didi had come to be worth billions of dollars after highly publicized US stock market flotations. So when Beijing effectively outlawed swaths of the country’s for-profit education industry in July 2021, followed by draconian anti-trust regulations on the country's fintech names (where Xi Jinping also meant to teach the country's billionaire class a lesson who is truly in charge), the short-term market impact was brutal. Beijing’s initial measures emerged as part of a wider effort to make education more affordable as part of president Xi Jinping’s drive for "common prosperity" but that quickly raised questions over whether growth prospects across corporate China are countered by the capacity of the government to overhaul entire business models overnight. Sure enough, volatility stemming from the education sector was soon overshadowed by another set of government reforms related to common prosperity, a crackdown on leverage across the real estate sector where the biggest casualty was Evergrande, the world’s most indebted developer. The company, whose boss was not long ago China's 2nd richest man, was engulfed by a liquidity crisis in the summer that eventually resulted in a default in early December. Still, as the FT notes, China continues to draw in huge amounts of foreign capital, pushing the Chinese yuan to end 2021 at the strongest level since May 2018, a major hurdle to China's attempts to kickstart its slowing economy, and surely a precursor to even more monetary easing. Natgas hyperinflation: Natural gas supplanted crude oil as the world’s most important commodity in October and December as prices exploded to unprecedented levels and the world scrambled for scarce supplies amid the developed world's catastrophic transition to "green" energy. The crunch was particularly acute in Europe, which has become increasingly reliant on imports. Futures linked to TTF, the region’s wholesale gas price, hit a record €137 per megawatt hour in early October, rising more than 75%. In Asia, spot liquefied natural gas prices briefly passed the equivalent of more than $320 a barrel of oil in October. (At the time, Brent crude was trading at $80). A number of factors contributed, including rising demand as pandemic restrictions eased, supply disruptions in the LNG market and weather-induced shortfalls in renewable energy. In Europe, this was aggravated by plunging export volumes from Gazprom, Russia’s state-backed monopoly pipeline supplier, amid a bitter political fight over the launch of the Nordstream 2 pipeline. And with delays to the Nord Stream 2 gas pipeline from Russia to Germany, analysts say the European gas market - where storage is only 66% full - a cold snap or supply disruption away from another price spike Turkey's (latest) currency crisis:  As the FT's Jonathan Wheatley writes, Recep Tayyip Erdogan was once a source of strength for the Turkish lira, and in his first five years in power from 2003, the currency rallied from TL1.6 per US dollar to near parity at TL1.2. But those days are long gone, as Erdogan's bizarre fascination with unorthodox economics, namely the theory that lower rates lead to lower inflation also known as "Erdoganomics", has sparked a historic collapse in the: having traded at about TL7 to the dollar in February, it has since fallen beyond TL17, making it the worst performing currency of 2021. The lira’s defining moment in 2021 came on November 18 when the central bank, in spite of soaring inflation, cut its policy rate for the third time since September, at Erdogan’s behest (any central banker in Turkey who disagrees with "Erdoganomics" is promptly fired and replaced with an ideological puppet). The lira recovered some of its losses in late December when Erdogan came up with the "brilliant" idea of erecting the infamous "doom loop" which ties Turkey's balance sheet to its currency. It has worked for now (the lira surged from TL18 against the dollar to TL12, but this particular band aid solution will only last so long). The lira’s problems are not only Erdogan’s doing. A strengthening dollar, rising oil prices, the relentless covid pandemic and weak growth in developing economies have been bad for other emerging market currencies, too, but as long as Erdogan is in charge, shorting the lira remains the best trade entering 2022. While these, and many more, stories provided a diversion from the boring existence of centrally-planned markets, we are confident that the trends observed in recent years will continue: coming years will be marked by even bigger government (because only more government can "fix" problems created by government), higher stock prices and dollar debasement (because only more Fed intervention can "fix" the problems created by the Fed), and a policy flip from monetary and QE to fiscal & MMT, all of which will keep inflation at scorching levels, much to the persistent confusion of economists everywhere. Of course, we said much of this last year as well, but while we got most trends right, we were wrong about one thing: we were confident that China's aggressive roll out of the digital yuan would be a bang - or as we put it "it is very likely that while 2020 was an insane year, it may prove to be just an appetizer to the shockwaves that will be unleashed in 2021 when we see the first stage of the most historic overhaul of the fiat payment system in history" - however it turned out to be a whimper. A big reason for that was that the initial reception of the "revolutionary" currency was nothing short of disastrous, with Chinese admitting they were "not at all excited" about the prospect of yet one more surveillance mechanism for Beijing, because that's really what digital currencies are: a way for central banks everywhere to micromanage and scrutinize every single transaction, allowing the powers that be to demonetize any one person - or whole groups - with the flick of a switch. Then again, while digital money may not have made its triumphant arrival in 2021, we are confident that the launch date has merely been pushed back to 2022 when the rollout of the next monetary revolution is expected to begin in earnest. Here we should again note one thing: in a world undergoing historic transformations, any free press must be throttled and controlled, and over the past year we have seen unprecedented efforts by legacy media and its corporate owners, as well as the new "social media" overlords do everything in their power to stifle independent thought. For us it had been especially "personal" on more than one occasions. Last January, Twitter suspended our account because we dared to challenge the conventional narrative about the source of the Wuhan virus. It was only six months later that Twitter apologized, and set us free, admitting it had made a mistake. Yet barely had twitter readmitted us, when something even more unprecedented happened: for the first time ever (to our knowledge) Google - the world's largest online ad provider and monopoly - demonetized our website not because of any complaints about our writing but because of the contents of our comment section. It then held us hostage until we agreed to implement some prerequisite screening and moderation of the comments section. Google's action was followed by the likes of PayPal, Amazon, and many other financial and ad platforms, who rushed to demonetize and suspend us simply because they disagreed with what we had to say. This was a stark lesson in how quickly an ad-funded business can disintegrate in this world which resembles the dystopia of 1984 more and more each day, and we have since taken measures. One year ago, for the first time in our 13 year history, we launched a paid version of our website, which is entirely ad and moderation free, and offers readers a variety of premium content. It wasn't our intention to make this transformation but unfortunately we know which way the wind is blowing and it is only a matter of time before the gatekeepers of online ad spending block us again. As such, if we are to have any hope in continuing it will come directly from you, our readers. We will keep the free website running for as long as possible, but we are certain that it is only a matter of time before the hammer falls as the censorship bandwagon rolls out much more aggressively in the coming year. That said, whether the story of 2022, and the next decade for that matter, is one of helicopter or digital money, of (hyper)inflation or deflation: what is key, and what we learned in the past decade, is that the status quo will throw anything at the problem to kick the can, it will certainly not let any crisis go to waste... even the deadliest pandemic in over a century. And while many already knew that, the events of 2021 made it clear to a fault that not even a modest market correction can be tolerated going forward. After all, if central banks aim to punish all selling, then the logical outcome is to buy everything, and investors, traders and speculators did just that armed with the clearest backstop guarantee from the Fed, which in the deapths of the covid crash crossed the Rubicon when it formally nationalized the bond market as it started buying both investment grade bonds and junk bond ETFs in the open market. As such it is no longer even a debatable issue if the Fed will buy stocks after the next crash - the only question is when. Meanwhile, for all those lamenting the relentless coverage of politics in a financial blog, why finance appears to have taken a secondary role, and why the political "narrative" has taken a dominant role for financial analysts, the past year showed vividly why that is the case: in a world where markets gyrated, and "rotated" from value stocks to growth and vice versa, purely on speculation of how big the next stimulus out of Washington will be, the narrative over Biden's trillions proved to be one of the biggest market moving events for much of the year. And with the Biden stimulus plan off the table for now, the Fed will find it very difficult to tighten financial conditions, especially if it does so just as the economy is slowing. Here we like to remind readers of one of our favorite charts: every financial crisis is the result of Fed tightening. As for predictions about the future, as the past two years so vividly showed, when it comes to actual surprises and all true "black swans", it won't be what anyone had expected. And so while many themes, both in the political and financial realm, did get some accelerated closure courtesy of China's covid pandemic, dramatic changes in 2021 persisted, and will continue to manifest themselves in often violent and unexpected ways - from the ongoing record polarization in the US political arena, to "populist" upheavals around the developed world, to the gradual transition to a global Universal Basic (i.e., socialized) Income regime, to China's ongoing fight with preserving stability in its gargantuan financial system which is now two and a half times the size of the US. As always, we thank all of our readers for making this website - which has never seen one dollar of outside funding (and despite amusing recurring allegations, has certainly never seen a ruble from the KGB either, although now that the entire Russian hysteria episode is over, those allegations have finally quieted down), and has never spent one dollar on marketing - a small (or not so small) part of your daily routine. Which also brings us to another critical topic: that of fake news, and something we - and others who do not comply with the established narrative - have been accused of. While we find the narrative of fake news laughable, after all every single article in this website is backed by facts and links to outside sources, it is clearly a dangerous development, and a very slippery slope that the entire developed world is pushing for what is, when stripped of fancy jargon, internet censorship under the guise of protecting the average person from "dangerous, fake information." It's also why we are preparing for the next onslaught against independent thought and why we had no choice but to roll out a premium version of this website. In addition to the other themes noted above, we expect the crackdown on free speech to accelerate in the coming year when key midterm elections will be held, especially as the following list of Top 20 articles for 2021 reveals, many of the most popular articles in the past year were precisely those which the conventional media would not touch out of fear of repercussions, which in turn allowed the alternative media to continue to flourish in an orchestrated information vacuum and take significant market share from the established outlets by covering topics which the public relations arm of established media outlets refused to do, in the process earning itself the derogatory "fake news" condemnation. We are grateful that our readers - who hit a new record high in 2021 - have realized it is incumbent upon them to decide what is, and isn't "fake news." * * * And so, before we get into the details of what has now become an annual tradition for the last day of the year, those who wish to jog down memory lane, can refresh our most popular articles for every year during our no longer that brief, almost 11-year existence, starting with 2009 and continuing with 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019 and 2020. So without further ado, here are the articles that you, our readers, found to be the most engaging, interesting and popular based on the number of hits, during the past year. In 20th spot with 600,000 reads, was an article that touched on one of the most defining features of the market: the reflation theme the sparked a massive rally at the start of the year courtesy of the surprise outcome in the Georgia Senate race, where Democrats ended up wining both seats up for grabs, effectively giving the Dems a majority in both the House and the Senate, where despite the even, 50-seat split, Kamala Harris would cast the winning tie-breaker vote to pursue a historic fiscal stimulus. And sure enough, as we described in "Bitcoin Surges To Record High, Stocks & Bonds Battered As Dems Look Set To Take Both Georgia Senate Seats", with trillions in "stimmies" flooding both the economy and the market, not only did retail traders enjoy unprecedented returns when trading meme "stonks" and forcing short squeezes that crippled numerous hedge funds, but expectations of sharply higher inflation also helped push bitcoin and the entire crypto sector to new all time highs, which in turn legitimized the product across institutional investors and helped it reach a market cap north of $3 trillion.  In 19th spot, over 613,000 readers were thrilled to read at the start of September that "Biden Unveils Most Severe COVID Actions Yet: Mandates Vax For All Federal Workers, Contractors, & Large Private Companies." Of course, just a few weeks later much of Biden's mandate would be struck down in courts, where it is now headed to a decision by SCOTUS, while the constantly shifting "scientific" goal posts mean that just a few months later the latest set of CDC regulations have seen regulators and officials reverse the constant drone of fearmongering and are now even seeking to cut back on the duration of quarantine and other lockdown measures amid a public mood that is growing increasingly hostile to the government response. One of the defining political events of 2021 was the so-called "Jan 6 Insurrection", which the for America's conservatives was blown wildly out of proportion yet which the leftist media and Democrats in Congress have been periodically trying to push to the front pages in hopes of distracting from the growing list of failures of the Obama admin. Yet as we asked back in January, "Why Was Founder Of Far-Left BLM Group Filming Inside Capitol As Police Shot Protester?" No less than 614,000 readers found this question worthy of a response. Since then many more questions have emerged surrounding this event, many of which focus on what role the FBI had in organizing and encouraging this event, including the use of various informants and instigators. For now, a response will have to wait at least until the mid-term elections of 2022 when Republicans are expected to sweep one if not both chambers. Linked to the above, the 17th most read article of 2021 with 617,000 views, was an article we published on the very same day, which detailed that "Armed Protesters Begin To Arrive At State Capitols Around The Nation." At the end of the day, it was much ado about nothing and all protests concluded peacefully and without incident: perhaps the FBI was simply spread too thin? 2021 was a year defined by various waves of the covid pandemic which hammered poor Americans forced to hunker down at home and missing on pay, and crippled countless small mom and pop businesses. And yet, it was also a bonanza for a handful of pharma companies such as Pfizer and Moderna which made billions from the sale of "vaccines" which we now know do little if anything to halt the spread of the virus, and are instead now being pitched as palliatives, preventing a far worse clinical outcome. The same pharma companies also benefited from an unconditional indemnity, which surely would come in useful when the full side-effects of their mRNA-based therapies became apparent. One such condition to emerge was myocarditis among a subset of the vaxxed. And while the vaccines continue to be broadly rolled out across most developed nations, one place that said enough was Sweden. As over 620,000 readers found out in "Sweden Suspends Moderna Shot Indefinitely After Vaxxed Patients Develop Crippling Heart Condition", not every country was willing to use its citizens as experimental guniea pigs. This was enough to make the article the 16th most read on these pages, but perhaps in light of the (lack of) debate over the pros and cons of the covid vaccines, this should have been the most read article this year? Moving on to the 15th most popular article, 628,000 readers were shocked to learn that "Chase Bank Cancels General Mike Flynn's Credit Cards." The action, which was taken by the largest US bank due to "reputational risk" echoed a broad push by tech giants to deplatform and silence dissenting voices by literally freezing them out of the financial system. In the end, following widespread blowback from millions of Americans, JPMorgan reversed, and reactivated Flynn's cards saying the action was made in error, but unfortunately this is just one example of how those in power can lock out any dissenters with the flick of a switch. And while democrats cheer such deplatforming today, the political winds are fickle, and we doubt they will be as excited once they find themselves on the receiving end of such actions. And speaking of censorship and media blackouts, few terms sparked greater response from those in power than the term Ivermectin. Viewed by millions as a cheap, effective alternative to offerings from the pharmaceutical complex, social networks did everything in their power to silence any mention of a drug which the Journal of Antibiotics said in 2017 was an "enigmatic multifaceted ‘wonder’ drug which continues to surprise and exceed expectations." Nowhere was this more obvious than in the discussion of how widespread use of Ivermectin beat Covid in India, the topic of the 14th most popular article of 2021 "India's Ivermectin Blackout" which was read by over 653,000 readers. Unfortunately, while vaccines continue to fail upward and now some countries are now pushing with a 4th, 5th and even 6th vaccine, Ivermectin remains a dirty word. There was more covid coverage in the 13th most popular article of 2021, "Surprise Surprise - Fauci Lied Again": Rand Paul Reacts To Wuhan Bombshell" which was viewed no less than 725,000 times. Paul's reaction came following a report which revealed that Anthony Fauci's NIAID and its parent, the NIH, funded Gain-of-Function research in Wuhan, China, strongly hinting that the emergence of covid was the result of illicit US funding. Not that long ago, Fauci had called Paul a 'liar' for accusing him of funding the risky research, in which viruses are genetically modified or otherwise altered to make them more transmissible to humans. And while we could say that Paul got the last laugh, Fauci still remains Biden's top covid advisor, which may explain why one year after Biden vowed he would shut down the pandemic, the number of new cases just hit a new all time high. One hope we have for 2022 is that people will finally open their eyes... 2021 was not just about covid - soaring prices and relentless inflation were one of the most poignant topics. It got so bad that Biden's approval rating - and that of Democrats in general - tumbled toward the end of the year, putting their mid-term ambitions in jeopardy, as the public mood soured dramatically in response to the explosion in prices. And while one can debate whether it was due to supply-issues, such as the collapse in trans-pacific supply chains and the chronic lack of labor to grow the US infrastructure, or due to roaring demand sparked by trillions in fiscal stimulus, but when the "Big Short" Michael Burry warned that hyperinflation is coming, the people listened, and with over 731,000 reads, the 12th most popular article of 2021 was "Michael Burry Warns Weimar Hyperinflation Is Coming."  Of course, Burry did not say anything we haven't warned about for the past 12 years, but at least he got the people's attention, and even mainstream names such as Twitter founder Jack Dorsey agreed with him, predicting that bitcoin will be what is left after the dollar has collapsed. While hyperinflation may will be the endgame, the question remains: when. For the 11th most read article of 2021, we go back to a topic touched upon moments ago when we addressed the full-blown media campaign seeking to discredit Ivermectin, in this case via the D-grade liberal tabloid Rolling Stone (whose modern incarnation is sadly a pale shadow of the legend that house Hunter S. Thompson's unforgettable dispatches) which published the very definition of fake news when it called Ivermectin a "horse dewormer" and claimed that, according to a hospital employee, people were overdosing on it. Just a few hours later, the article was retracted as we explained in "Rolling Stone Issues 'Update' After Horse Dewormer Hit-Piece Debunked" and over 812,000 readers found out that pretty much everything had been a fabrication. But of course, by then it was too late, and the reputation of Ivermectin as a potential covid cure had been further tarnished, much to the relief of the pharma giants who had a carte blanche to sell their experimental wares. The 10th most popular article of 2021 brings us to another issue that had split America down the middle, namely the story surrounding Kyle Rittenhouse and the full-blown media campaign that declared the teenager guilty, even when eventually proven innocent. Just days before the dramatic acquittal, we learned that "FBI Sat On Bombshell Footage From Kyle Rittenhouse Shooting", which was read by over 822,000 readers. It was unfortunate to learn that once again the scandal-plagued FBI stood at the center of yet another attempt at mass misinformation, and we can only hope that one day this "deep state" agency will be overhauled from its core, or better yet, shut down completely. As for Kyle, he will have the last laugh: according to unconfirmed rumors, his numerous legal settlements with various media outlets will be in the tens if not hundreds of millions of dollars.  And from the great US social schism, we again go back to Covid for the 9th most popular article of 2021, which described the terrifying details of one of the most draconian responses to covid in the entire world: that of Australia. Over 900,000 readers were stunned to read that the "Australian Army Begins Transferring COVID-Positive Cases, Contacts To Quarantine Camps." Alas, the latest surge in Australian cases to nosebleed, record highs merely confirms that this unprecedented government lockdown - including masks and vaccines - is nothing more than an exercise in how far government can treat its population as a herd of sheep without provoking a violent response.  The 8th most popular article of 2021 looks at the market insanity of early 2021 when, at the end of January, we saw some of the most-shorted, "meme" stocks explode higher as the Reddit daytrading horde fixed their sights on a handful of hedge funds and spent billions in stimmies in an attempt to force unprecedented ramps. That was the case with "GME Soars 75% After-Hours, Erases Losses After Liquidity-Constrained Robinhood Lifts Trading Ban", which profiled the daytrading craze that gave an entire generation the feeling that it too could win in these manipulated capital markets. Then again, judging by the waning retail interest, it is possible that the excitement of the daytrading army is fading as rapidly as it first emerged, and that absent more "stimmies" markets will remain the playground of the rich and central banks. Kyle Rittenhouse may soon be a very rich man after the ordeal he went through, but the media's mission of further polarizing US society succeeded, and millions of Americans will never accept that the teenager was innocent. It's also why with just over 1 million reads, the 7th most read article on Zero Hedge this year was that "Portland Rittenhouse Protest Escalates Into Riot." Luckily, this is not a mid-term election year and there were no moneyed interests seeking to prolong this particular riot, unlike what happened in the summer of 2020... and what we are very much afraid will again happen next year when very critical elections are on deck.  With just over 1.03 million views, the 6th most popular post focused on a viral Twitter thread on Friday from Dr Robert Laone, which laid out a disturbing trend; the most-vaccinated countries in the world are experiencing  a surge in COVID-19 cases, while the least-vaccinated countries were not. As we originally discussed in ""This Is Worrying Me Quite A Bit": mRNA Vaccine Inventor Shares Viral Thread Showing COVID Surge In Most-Vaxxed Countries", this trend has only accelerated in recent weeks with the emergence of the Omicron strain. Unfortunately, instead of engaging in a constructive discussion to see why the science keeps failing again and again, Twitter's response was chilling: with just days left in 2021, it suspended the account of Dr. Malone, one of the inventors of mRNA technology. Which brings to mind something Aaron Rogers said: "If science can't be questioned it's not science anymore it's propaganda & that's the truth." In a year that was marked a flurry of domestic fiascoes by the Biden administration, it is easy to forget that the aged president was also responsible for the biggest US foreign policy disaster since Vietnam, when the botched evacuation of Afghanistan made the US laughing stock of the world after 12 US servicemembers were killed. So it's probably not surprising that over 1.1 million readers were stunned to watch what happened next, which we profiled in the 5th most popular post of 2021, where in response to the Afghan trajedy, "Biden Delivers Surreal Press Conference, Vows To Hunt Down Isis, Blames Trump." One person watching the Biden presser was Xi Jinping, who may have once harbored doubts about reclaiming Taiwan but certainly does not any more. The 4th most popular article of 2021 again has to do with with covid, and specifically the increasingly bizarre clinical response to the disease. As we detailed in "Something Really Strange Is Happening At Hospitals All Over America" while emergency rooms were overflowing, it certainly wasn't from covid cases. Even more curiously, one of the primary ailments leading to an onslaught on ERs across the nation was heart-related issues, whether arrhytmia, cardiac incidents or general heart conditions. We hope that one day there will be a candid discussion on this topic, but until then it remains one of the topics seen as taboo by the mainstream media and the deplatforming overlords, so we'll just leave it at that. We previously discussed the anti-Ivermectin narrative that dominated the mainstream press throughout 2021 and the 3rd most popular article of the year may hold clues as to why: in late September, pharma giant Pfizer and one of the two companies to peddle an mRNA based vaccine, announced that it's launching an accelerated Phase 2/3 trial for a COVID prophylactic pill designed to ward off COVID in those may have come in contact with the disease. And, as we described in "Pfizer Launches Final Study For COVID Drug That's Suspiciously Similar To 'Horse Paste'," 1.75 million readers learned that Pfizer's drug shared at least one mechanism of action as Ivermectin - an anti-parasitic used in humans for decades, which functions as a protease inhibitor against Covid-19, which researchers speculate "could be the biophysical basis behind its antiviral efficiency." Surely, this too was just another huge coincidence. In the second most popular article of 2021, almost 2 million readers discovered (to their "shock") that Fauci and the rest of Biden's COVID advisors were proven wrong about "the science" of COVID vaccines yet again. After telling Americans that vaccines offer better protection than natural infection, a new study out of Israel suggested the opposite is true: natural infection offers a much better shield against the delta variant than vaccines, something we profiled in "This Ends The Debate' - Israeli Study Shows Natural Immunity 13x More Effective Than Vaccines At Stopping Delta." We were right about one thing: anyone who dared to suggest that natural immunity was indeed more effective than vaccines was promptly canceled and censored, and all debate almost instantly ended. Since then we have had tens of millions of "breakout" cases where vaccinated people catch covid again, while any discussion why those with natural immunity do much better remains under lock and key. It may come as a surprise to many that the most read article of 2021 was not about covid, or Biden, or inflation, or China, or even the extremely polarized US congress (and/or society), but was about one of the most long-suffering topics on these pages: precious metals and their prices. Yes, back in February the retail mania briefly targeted silver and as millions of reddit daytraders piled in in hopes of squeezing the precious metal higher, the price of silver surged higher only to tumble just as quickly as it has risen as the seller(s) once again proved more powerful than the buyers. We described this in "Silver Futures Soar 8%, Rise Above $29 As Reddit Hordes Pile In", an article which some 2.4 million gold and silver bugs read with hope, only to see their favorite precious metals slump for much of the rest of the year. And yes, the fact that both gold and silver ended the year sharply lower than where they started even though inflation hit the highest level in 40 years, remains one of the great mysteries of 2021. With all that behind us, and as we wave goodbye to another bizarre, exciting, surreal year, what lies in store for 2022, and the next decade? We don't know: as frequent and not so frequent readers are aware, we do not pretend to be able to predict the future and we don't try despite endless allegations that we constantly predict the collapse of civilization: we leave the predicting to the "smartest people in the room" who year after year have been consistently wrong about everything, and never more so than in 2021 (even the Fed admitted it is clueless when Powell said it was time to retire the term "transitory"), which destroyed the reputation of central banks, of economists, of conventional media and the professional "polling" and "strategist" class forever, not to mention all those "scientists" who made a mockery of the "expertise class" with their bungled response to the covid pandemic. We merely observe, find what is unexpected, entertaining, amusing, surprising or grotesque in an increasingly bizarre, sad, and increasingly crazy world, and then just write about it. We do know, however, that after a record $30 trillion in stimulus was conjured out of thin air by the world's central banks and politicians in the past two years, the attempt to reverse this monetary and fiscal firehose in a world addicted to trillions in newly created liquidity now that central banks are freaking out after finally getting ot the inflation they were hoping to create for so long, will end in tears. We are confident, however, that in the end it will be the very final backstoppers of the status quo regime, the central banking emperors of the New Normal, who will eventually be revealed as fully naked. When that happens and what happens after is anyone's guess. But, as we have promised - and delivered - every year for the past 13, we will be there to document every aspect of it. Finally, and as always, we wish all our readers the best of luck in 2022, with much success in trading and every other avenue of life. We bid farewell to 2021 with our traditional and unwavering year-end promise: Zero Hedge will be there each and every day - usually with a cynical smile - helping readers expose, unravel and comprehend the fallacy, fiction, fraud and farce that defines every aspect of our increasingly broken system. Tyler Durden Sun, 01/02/2022 - 03:44.....»»

Category: personnelSource: nytJan 2nd, 2022

Michael Burry, Jeremy Grantham, and other top investors are predicting an epic market crash. Here are their gravest warnings of 2021.

The "bond king" Jeffrey Gundlach, the "Shark Tank" star Kevin O'Leary, and the "Rich Dad Poor Dad" author Robert Kiyosaki are expecting a downturn. Michael Burry.Jim Spellman/Getty Images Michael Burry, Jeremy Grantham, and other experts are predicting an epic market crash. Jeffrey Gundlach, Leon Cooperman, and Stanley Druckenmiller expect a downturn too. Here are the gravest warnings so far from eight top investors and commentators. See more stories on Insider's business page. Michael Burry and Jeremy Grantham are bracing for a devastating crash across financial markets. They're far from the only experts to warn that rampant speculation fueled by government stimulus programs can't shore up asset prices forever.The billionaire investors Leon Cooperman, Stanley Druckenmiller, and Jeffrey Gundlach have also sounded the alarm. The same is true for the "Shark Tank" star Kevin O'Leary, the market prophet Gary Shilling, and the "Rich Dad Poor Dad" author Robert Kiyosaki.Here are the most striking warnings from these 8 market experts:Michael BurryMichael Burry.Getty Images/ Astrid StawiarzBurry described the markets as the "greatest speculative bubble of all time in all things" in June 2021, and said retail investors were buying into the hype around meme stocks and cryptocurrencies before the "mother of all crashes."In the weeks and months before that tweet, the investor of "The Big Short" fame, who runs Scion Asset Management, pointed to Tesla, GameStop, bitcoin, dogecoin, Robinhood, and the red-hot US housing market as signs of speculative excess.Read more: Goldman Sachs says buy these 20 stocks that have the most upside potential right now — including 5 set to surge by at least 50%Jeremy GranthamJeremy Grantham.Morningstar/YouTubeGrantham  said in January 2021 the market was a "fully fledged epic bubble" and described it as the "real McCoy.""When you have reached this level of obvious super-enthusiasm, the bubble has always, without exception, broken in the next few months, not a few years," the legendary investor and GMO cofounder said."We will have to live, potentially, possibly, with the biggest loss of perceived value from assets that we have ever seen," Grantham added.Leon CoopermanLeon Cooperman.Jeff Zelevansky/ReutersCooperman expressed deep concerns about financial markets in May 2021."Everything I look at would suggest caution, intermediate to long term, would be the rule of the day," the billionaire investor and Omega Advisors boss said. "When this market has a reason to go down, it's going to go down so fast your head's going to spin."But Cooperman described himself as a "fully invested bear" because factors that typically cause bear markets — rising inflation, recession fears, a hostile Federal Reserve — weren't present.Read more: How to mine doge: An 18-year-old TikTok influencer shares his process for earning crypto without directly buying via a $700 rig — and explains how it works for other altcoins including litecoinStanley DruckenmillerStanley Druckenmiller.Brendan McDermid/ReutersDruckenmiller said in May 2021 that the bull market reminded him of the dot-com boom, but he cautioned that asset prices could continue rising for a while."I have no doubt that we are in a raging mania in all assets," the billionaire investor and Duquesne Family Office chief said. "I also have no doubt that I don't have a clue when that's going to end."I knew we were in a raging mania in '99, but it kept going on, and if you had shorted the tech stocks in mid-'99, you were out of business by the end of the year," Druckenmiller added.The investor indicated he would pull his cash out of equities in a matter of months."I will be surprised if we're not out of the stock market by the end of the year, just because the bubbles can't last that long," he said.Jeffrey GundlachJeffrey Gundlach.Jessica Rinaldi/ReutersEquities are undeniably expensive, Gundlach said in March 2021.The billionaire investor and DoubleLine Capital boss said that claiming the stock market was "anything other than very overvalued versus history" was "just to be ignorant of all the metrics of valuation." He predicted that stocks would fall by upwards of 15% when the downturn comes.Gundlach, known as the "bond king," predicted that the retail investors who had piled into meme stocks and other speculative assets wouldn't stick around once prices started dropping."We'll have a tremendous unwind of a lot of the money that thinks that the stock market is a one-way thing," he said.Read more: Famed investor Michael Burry is predicting the 'mother of all crashes'. Here's what 9 other key 'Big Short' players are doing now.Kevin O'LearyKevin O'Leary."Shark Tank"/ABCO'Leary said in April 2021 that stocks would eventually crumble, but he framed the downturn as an educational opportunity for rookie investors."Buying the dip is more rock-and-roll, but what invariably happens is you go through a massive correction and you learn a very important lesson," the "Shark Tank" star and O'Leary Funds chief said."The generation that is trading right now has never gone through a sustained correction. It's coming — I don't know when, I don't know what'll trigger it, but they will learn their lesson," he continued."If you have a lot of leverage on, it's a hell of a lesson because you end up in a negative net-worth position," O'Leary added. "But you do learn from it."Robert KiyosakiRobert Kiyosaki.The Rich Dad Channel/YouTubeKiyosaki tweeted in June 2021 that he was expecting the greatest market crash ever."Biggest bubble in world history getting bigger," the personal-finance guru and author of "Rich Dad Poor Dad" said. "Biggest crash in world history coming."Kiyosaki has accused the Federal Reserve of overstimulating markets and devaluing the dollar. He's advised investors to prepare for the downturn by stocking up on precious metals and cryptocurrencies."ARE YOU READY?" he tweeted in April. "Boom, Bust, Mania, Crash, Depression. Mania in markets today. Prepare for biggest crash, depression in world history. What will Fed do? Print more money? Save more gold, silver, bitcoin."Gary ShillingGary Shilling.Bloomberg TVShilling predicted in April 2021 that financial markets would nosedive, but he declined to hazard a guess at when the crash would arrive."I'm not making any firm prediction as to when this thing is going to collapse," the veteran forecaster and president of A. Gary Shilling & Co. said."Speculations outrun any logic and that's probably going to be true of this one," Shilling continued. "But at some point, boy, there's going to be a lot of blood on the floor."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 2nd, 2022