But the market is due for a bounce, according to the WOLF STREET dictum that “Nothing Goes to Heck in a Straight Line.”
Wolf Richter on “This Week in Money.”
The Fed, which is trying to slow demand to tamp down on consumer price inflation, gnashes its teeth.
Everyone wants to know when inflation is finally going to cry uncle.
This inflation shock finally goosed the ECB out of its reckless NIRP policies.
The giant’s footprint reduction to cut costs sinks Commercial Real Estate.
It’s already playing a key role in every one of Powell’s press conferences.
The model of “growth at all cost” has been taken out to the dump.
It wasn’t big hedge funds that blew up, but £1.5 trillion in leveraged pension funds. BoE stepped in to bail them out and prevent further contagion.
The Case-Shiller index, which lags by several months, is starting to flip market by market, including in Phoenix, Dallas, Washington DC, and Boston.
Wealth of the “Top 0.1%” drops by $12 million per household; the wealth of the “Bottom 50%,” who have nearly nothing, rises.
Bank of England: won’t “hesitate” to hike rates “as much as needed.” Bond market fears much higher inflation and interest rates, for much longer.
But this time, there’s over 8% inflation.
Holy-moly mortgage rates close in on 7%.
It’s like a dam broke. And now higher interest rates and mortgage rates for much longer, with lower asset prices, as the Everything Bubble gets repriced.
The ridiculous price spikes now face Bank of Canada’s monster rate hikes, QT, and spiking mortgage rates.
“Housing market will have to go through a correction … to where people can afford housing again”: Powell
But these sales happened during the “Fed pivot” fantasy that pushed mortgage rates down to 5%. Now mortgage rates are near 6.5%.
Bank of Japan lets yen go to heck, trade deficit blows out, costs surge for manufacturers, prices surge for consumers.
But Kia, Toyota, Honda: nearly nothing on the lot. Where the shortages are, and where ample supply is, by brand and segment.