If you watched the Fed Chair Jerome Powell testify before the senate and the house early last week you heard over and over that banks are well capitalized. The non-sequitur inspiring the Shakespearean quote “Methinks you protest too much.”
Retail Investors Positioned For Thrashing
Individual investors are fighting the Fed trading options that expire the same day they begin trading. “This week, volume for contracts that expire on the same day they’re traded hit a record 50% share of all the options transactions on the S&P 500, data from CBOE and Nomura show.”
L.A. Walk Away
CoStar News reports, “The loan defaults are another sign of struggle for office real estate owners in the nation's second-largest city as remote working policies enacted in the pandemic hamper demand. National office real estate demand has been curtailed since 2020, with vacancy at 12.8%, its highest since the Great Recession, according to CoStar data.”
White Collar Canary
Tech and other corporate layoffs are announced everyday, but closer to your local courthouse, law firms are feeling the pinch.
Increased Interest Rates Erode Bank Capital
Many banks bought mortgage-backed securities during the zero-rate days to “juice income,” but now, on a mark-to-market basis those MBS are trading for a fraction of purchase prices, creating losses of 50 to 60 percent of capital. “Regulators are not pleased.”
Movements to Rackets: The Falwells Rise and Fall
The common thread of the four stories, three from the speech plus the Falwells, is as the movement becomes a racket each and every time power turns to money turns to sexual exploits.
The Confidence Man Runs Again
Unlike the many recent books about Trump, Haberman connects Donald’s early years with his presidential term and aftermath. Haberman has reported on Trump her entire career and is the only person who could write “Confidence Man.”
Crypto Meltdown and Pension Assets
However, as MarcoMaven’s Steph Pomboy tweeted Wednesday, “For my money, the most interesting…and foreboding…aspect of the downfall of Blankman-Freed’s FTX is the «revelation» that the Ontario Teachers Pension was a major investor. The coming pension crisis is going to be massive…and the switch to QE by global cbks whiplash-inducing.”
"Poison Ivy" Zelman's says "Stuck Factor" has Housing Market Stuck
Existing home sales are undergoing a historic sharp contraction in sales. And, what will keep the residential market sluggish is what Zelman calls the “Stuck Factor.”An incredible 92% of homeowners with mortgages have a 5% rate or lower.
Trump and The Age of Ignorance
My questioner, another prominent libertarian attorney, replied with words to the effect,”Trump showed no respect for the government strictures and laws we all hate. He was good because he showed no respect for the government.” While I put up no argument at the time, Trump’s disrespect reflected no libertarian principles, but only 300 pounds (okay 239 according to the White House physician) of walking, talking personal character defects.
Whistling Past the Graveyard
So, the average consumer’s home buying power has been cut in half. Two real estate broker friends, one specializing in high end, the other, a notch below, say the market in Las Vegas is dead.
Stormy Monday or Finally a Pivot?
FXHedge tweeted Saturday, “CREDIBLE SOURCE SAYS A MAJOR INTERNATIONAL INVESTMENT BANK ON THE BRINK -ABC AUSTRALIA “
Housing: Is it a Correction or Worse?
Big builder Lennar sent out a sales flier via email, advertising 3.99% mortgage interest from Lennar Home mortgage plus price reductions of $40,000 to $50,000 a unit. These reductions included units in subdivisions selling from the $300,000s all the way to over $1,000,000.
Political Strategists On the Road
once relatively anonymous political strategists now have star power that had previously only been accessible to those at the tippy-top of the presidential strategist ladder, people like Lee Atwater or Karl Rove or James Carville or Paul Begala,” Miller writes.
The Fed's Thumb Prints
The dollar’s value is a symptom, and when it goes up, “what that tells you is that there’s tightening in the global monetary system for a variety of reasons, usually self-reinforcing reasons,” Snider explained. Money is tight, markets are risk averse, with the result being a recession is coming forthwith.
Too Good to be True, Too Good to Resist
Get rich quick schemes never go out of style. Robbing Peter to pay Paul excels in its simplicity. Forget gauging the winds of the markets or the bouncing ball on a roulette wheel. Phony promises work on a gullible public to this day. “We are all gamblers,” Ponzi believed. “We all crave easy money. And plenty of it. If we didn't, no get-rich-quick scheme could be successful.”
The NFL Draft: Grappling with Uncertainty
The draft seems dreadfully dull to watch for even the most ardent fans. But, the Las Vegas Convention and Visitors Authority (LVCVA) figures the town will clean up hosting three nights of player picking on the water. It’s being compared to New Year's Eve with attendance of one million people (with some double-counting).
Clarence Darrow vs. The State
“Clarence Darrow is the lawyer every law school student dreams of being: on the side of right, loved by many women, played by Spencer Tracy in Inherit the Wind. His days-long closing arguments delivered without notes won miraculous reprieves for men doomed to hang.”
Erdoğan opens the FDR/John Law monetary playbook
Mr. Nebati figures there is three hundred million dollars worth of gold under the beds of the Turkish populous, and the government would like to trade more than ten percent of the hoarded yellow metal for their flimsy paper lira.
George Hearst: Entrepreneur in the Mises Mold
For the first half of Bernstein’s very readable, and richly footnoted, book, Hearst was either bankrupt or rich, there was no inbetween. He made and lost fortunes, but nothing slowed him down. He had a natural nose for finding gold and silver.