Death of the Great Recovery Part 3: Housing Collapse 2.0 Has Begun

May 30th, 2018 by thegreatrecession.info

It’s simple math — an equal and opposite reaction. After a long spell of QE took mortgage interest down to the lowest it has ever been, a long spell of QT (quantitative tightening) is going to take it back up again. That’s why I forecasted another housing collapse with confidence last year:

Rising mortgage rates will certainly cause housing sales to fall. Prices will follow for those houses that have to sell because, as mortgage interest rises, people won’t qualify for as large a mortgage as they do now. It’s all part of the developing Epocalypse in which multiple industries collapse into the final depths of the Great Recession as the fake recovery fades out of existence like a mirage.

The big difference between 2010 and now, and between 2008 and now, is that home prices have skyrocketed since then in many markets – by over 50% in some markets…. In other markets, increases have been in the 25% to 40% range. This worked because mortgage rates zigzagged lower over those years, thus keeping mortgage payments on these higher priced homes within reach for enough people. But that ride is ending. (Zero Hedge)

I gave this part of my 2018 economic predictions more time to play out than I did for Carmageddon

Death of the Great Recovery Part 2: The Second Coming of Carmageddon

or the Retail Apocalypse

The Global Economic Tide is Quickly Receding

or a 2018 stock market crash

Death of the Great Recovery Part 1: Stocks in Bondage and Bonds in the Stockade

because mortgage rates are not as volatile as things like credit-card rates, nor do housing prices quickly reverse. People can hold out for a year or more or choose not to sell at all before they are inclined to drop the price of their most treasured asset.

Nevertheless, mortgage interest is rising at the fastest rate seen in nearly half a century in what has been the most prolonged increase in 46 years. Rates are already at 4.66% on a 30-year mortgage and briefly touched a seven-year high, even though the Fed’s unwind is only at half speed and has only been happening (at an even lower speed) for a little over half a year.

Mortgage rates spiked in a big way today, bringing some lenders to the highest levels in nearly 7 years (you’d need to go back to July 2011 to see worse)…. Today did cover quite a bit more distance than other recent “bad days.” (Zero Hedge)

As interest rises, sales and prices will go into decline; but right now we still have a lot of rebuilding to do from the hurricanes and wildfires; rates are just beginning their rise; and we are entering the peak building and buying season. That means I expect a summer housing boom this year — a last hurrah — as buyers try to pour into the market before rates rise any more … as soon as school is out … and as rebuilding from last year’s hurricanes and fire storms gets under full swing.

That’s in keeping with what I said last year when I had predicted a housing decline for that summer. Housing did start to show notable problems, but the hurricanes and wildfires changed all of that to where I revised my date (prior to any known change in reported housing statistics) to say the housing decline that had begun would be delayed until the fall of 2018 due to the flurry of buying and rebuilding that the storms would necessitate.

I predicted a quick rebound to housing last fall when any of the storm afflicted who could move quickly would suck up available inventory or move to other regions and find new jobs. Then I said there would be a delayed boost for rest who chose, instead, to build new homes or rebuild damaged ones. That boost would be delayed until spring and summer of this year because clean up and planning and, in many cases, infrastructure repairs have to happen before new construction can begin, and we were moving into winter which inhibits construction.

After this coming fall, however, it’s downhill all the way for housing. The only caveat I see for that prediction is the same one that saved housing when it started going down last year: the national weather service says we are on track for another year of major storms (both hurricanes and fire storms all over again … if they know what they are talking about.) If such difficult-to-predict events materialize, they will again force a lot of people to buy new homes or rebuild old ones. That, however, is not a rinse-and-repeat cycle that can restore the economy.

The Rest Of The Story Below:

Death of the Great Recovery Part 3: Housing Collapse 2.0 Has Begun

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We Have Just Seen The Beginning Of The Economic Meltdown

X22Report

Published on May 29, 2018

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Report date: 05.29.2018

The founder of Ethereum asked the question does the central banks (Rothschild) control reach into the blockchain world. To control the blockchain it would be very difficult to control a single crypto would be more feasible. Case Shiller prices rise to the most that we have seen since the financial crisis, this is way over the amount of money make. Italy's economy was hit hard, the banks are insolvent, this is just the beginning, will the ECB, IMF step in to calm the situation down, this will spread to other areas and other banks.

All source links to the report can be found on the x22report.com site.

Most of artwork that are included with these videos have been created by X22 Report and they are used as a representation of the subject matter. The representative artwork included with these videos shall not be construed as the actual events that are taking place.

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Fair Use Notice: This video contains some copyrighted material whose use has not been authorized by the copyright owners. We believe that this not-for-profit, educational, and/or criticism or commentary use on the Web constitutes a fair use of the copyrighted material (as provided for in section 107 of the US Copyright Law. If you wish to use this copyrighted material for purposes that go beyond fair use, you must obtain permission from the copyright owner. Fair Use notwithstanding we will immediately comply with any copyright owner who wants their material removed or modified, wants us to link to their web site, or wants us to add their photo.

The X22 Report is "one man's opinion". Anything that is said on the report is either opinion, criticism, information or commentary, If making any type of investment or legal decision it would be wise to contact or consult a professional before making that decision.

Use the information found in these videos as a starting point for conducting your own research and conduct your own due diligence before making any significant investing decisions.

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George Soros Warns of Economic Collapse 2018

Soros Sees New Global Financial Crisis Brewing, EU Under Threat

By Nikos Chrysoloras and Helene Fouquet
‎May‎ ‎29‎, ‎2018‎

Read The Article Here

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“The Greater the Bubble, the Greater the Burst”

May 17th, 2018 by Harry Dent

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“Guess where the greatest US real estate gains have been since the Great Recession and the massive QE surge? Florida and California…surprise, surprise! California real-estate prices have exploded because there’s very limited supply there and Florida prices shot to the moon thanks to that state’s high domestic and international migration.

But here’s a real surprise… Property prices in Detroit and Flint, Michigan have also enjoyed massive appreciation! In fact, Detroit takes the number one spot, with prices gaining 193% while prices in Flint are up 169%! The boom in those two US cities is thanks to them starting from such a low point and rising from the ashes.

Look at this chart of the top US 20 cities for appreciation…

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As you can see, nine of the top 20 biggest gainers were in Florida with Cape Coral/Ft. Myers third with prices up 173%. That area got incredibly overbuilt and then slammed during the bubble and crash. We know because my wife has relatives there. Tampa, my recent hometown, is up 115%. Port St. Lucie, in #20 spot, is still up 111%. That’s a lot for real estate in six years or so.

Miami is second in Florida at 143%. But the hottest areas like South Beach, Sunny Isles, and Brickell/downtown are roughly double what they were in the last bubble! It’s so insane that my wife and I decided not to move back there when her caretaking in Tampa was done.

Six of the biggest gainers were in California, topped, of course, by San Jose (Silicon Valley area) at 191%. These six were all in the Northern part of the state, around or near San Francisco. The lowest gainers were Sacramento, with property prices up only 114% (one hour from San Francisco, where prices were up 158% after already being the most expensive city in the US), and Stockton and Modesto, both of which are up strongly for more boring valley cities due to residents commuting to San Francisco.

Both major cities in Nevada were on this list with Las Vegas prices up 140% and Reno up even higher at 166%.

And, of course, property prices in Phoenix are up 124%, not quite as bubbly as last time.

Prices in Denver are up 121%, much bubblier this time compared to the last bubble. Even Dallas has more exposure to a crash this time around. As does much of Texas due to the fracking bubble.

These numbers may seem fantastic, but they present significant danger… I always say this: The greater the bubble, the greater the burst…and the bubbles tend to occur in the most attractive cities for lifestyle or migration. Not in Omaha (sorry Warren Buffett).

Manhattan would be high on this list if it were broken out as a sector of New York City. These places, where prices have blasted past levels set during the previous bubble, are in for a world of hurt. If you’re an owner and/or an investor in one of these areas, be very worried!

My best indicator of overvaluation continues to be: What was your house or office building worth in January 2000 when this bubble first accelerated and became a bubble? That’s where I expect prices to fall back to!

This is the second and last real estate bubble. It’s as bad as, if not worse than, the first bubble in most areas. We’ll see a deeper downturn and deeper crash in most areas when this final bubble bursts between later 2018 and 2019. And this downturn will likely take something like six years to bottom as the last one did. But these top 20 ‘appreciators’ are going to suffer the worst.

The question to ask yourself now is this: How much do you love your real estate? Enough to go down with it?”
– https://www.marketsandmoney.com.au/

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In The Beginning The Illusion Seems Real, In The End The Truth Materializes

X22Report

Published on May 16, 2018

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Report date: 05.16.2018

More and more indicators are popping up and showing us that the economy has not improved at all but declined since 2008. Nothing has been fixed and the illusion is starting to disappear, it is getting harder to hide what is really going on. The subprime chaos is continuing and the damage is going to spread. Housing starts and permits decline in the time period they should be skyrocketing, this is the hot time for real estate, and we are seeing a huge reversal in real estate. Rates are increasing which means more buyers will be pushed out of the market.

All source links to the report can be found on the x22report.com site.

Most of artwork that are included with these videos have been created by X22 Report and they are used as a representation of the subject matter. The representative artwork included with these videos shall not be construed as the actual events that are taking place.

Intro Video Music: YouTube Free Music: Cataclysmic Molten Core by Jingle Punks

Intro Music: YouTube Free Music: Warrior Strife by Jingle Punks

Fair Use Notice: This video contains some copyrighted material whose use has not been authorized by the copyright owners. We believe that this not-for-profit, educational, and/or criticism or commentary use on the Web constitutes a fair use of the copyrighted material (as provided for in section 107 of the US Copyright Law. If you wish to use this copyrighted material for purposes that go beyond fair use, you must obtain permission from the copyright owner. Fair Use notwithstanding we will immediately comply with any copyright owner who wants their material removed or modified, wants us to link to their web site, or wants us to add their photo.

The X22 Report is "one man's opinion". Anything that is said on the report is either opinion, criticism, information or commentary, If making any type of investment or legal decision it would be wise to contact or consult a professional before making that decision.

Use the information found in these videos as a starting point for conducting your own research and conduct your own due diligence before making any significant investing decisions.

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The Cycle Has Ended, We Will Soon See The Collapse Of Each Sector -…

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We’re All Trespassers Now in the Face of the Government’s Land Grabs

By John W. Whitehead The Rutherford Institute May 9, 2018

“No power on earth has a right to take our property from us without our consent.” — John Jay, first Chief Justice of the United States

We have no real property rights.
Think about it.
That house you live in, the car you drive, the small (or not so small) acreage of land that has been passed down through your family or that you scrimped and saved to acquire, whatever money you manage to keep in your bank account after the government and its cronies have taken their first and second and third cut…none of it is safe from the government’s greedy grasp.
At no point do you ever have any real ownership in anything other than the clothes on your back.
Everything else can be seized by the government under one pretext or another (civil asset forfeiture, unpaid taxes, eminent domain, public interest, etc.).
The American Dream has been reduced to a lease arrangement in which we are granted the privilege of endlessly paying out the nose for assets that are only ours so long as it suits the government’s purposes.
And when it doesn’t suit the government’s purposes? Watch out.
This is not a government that respects the rights of its citizenry or the law. Rather, this is a government that sells its citizens to the highest bidder and speaks to them in a language of force.
Under such a fascist regime, the Fifth Amendment to the U.S. Constitution, which declares that no person shall “be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation,” has become yet another broken shield, incapable of rendering any protection against corporate greed while allowing the government to justify all manner of “takings” in the name of the public good.
As journalist Eric Williamson notes, “From controversial projects such as President Donald Trump’s border wall and the gas pipelines, to more mundane works such as road expansion, just about any project deemed in the public interest can mean taking your property is fair game.”
Practically anything goes now.
It’s been 13 years since the U.S. Supreme Court took up the case of Kelo v. City of New London, which expanded the government’s limited power to acquire private lands in order to build a public structure like a school or highway for “public use” and allowed it to make seizures for a “public purpose,” which in the government’s eyes can mean anything as long as it amounts to higher tax revenue.
In Kelo, the City of New London, Conn., wanted to condemn private homes as “blighted” in order to tear them down and allow a developer to build higher-priced homes, a resort hotel, a conference center and retail complexes to complement a new Pfizer pharmaceutical plant in the area. Ironically, the developers in New London later backed out of the deal after the homes were seized and bulldozed, leaving the once quaint neighborhood a wasteland.
Nevertheless, a shortsighted Supreme Court gave city officials the go-ahead, ruling 5-4 that a city government—aligned with large corporate interests—could use the power of eminent domain to seize an entire neighborhood for development purposes, entire neighborhoods have been seized and bulldozed to make way for shopping malls, sports complexes and corporate offices.
“The specter of condemnation hangs over all property,” warned Justice Sandra Day O’Connor in a stinging dissent. “Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory.”
Unfortunately, nothing has prevented the government from bulldozing its way through the Fifth Amendment in an effort to take from the middle and lower classes and fatten the coffers of the corporate elite.
In the wake of Kelo, at least 16 places of worship (which pay no taxes) were taken for private uses (which will generate tax dollars). Other attempted takings include the transfer of three family-owned seafood businesses to a larger private marina in Texas; the transfer of farmland to a shopping center anchored by a Lowe’s in Illinois; developing 233 low-income and elderly families’ properties into a senior community where townhouses cost more than $350,000 in New Jersey; and developing middle-income, single-family homes on the waterfront into more expensive condominiums in New Jersey.

The Rest Of The Story At The Link Below:

We’re All Trespassers Now

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Nomi Prins – In the Coming Crash We’ll be Falling from Higher Height

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The Fed Has Successfully Destroyed The U.S. Housing Market

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The Fed Has Successfully Destroyed The U.S. Housing Market

A few days ago a friend of mine sent me a link to some “insight” on the coming economic developments that we should be preparing for in terms of debts and deficits. The company providing this research piece has over a $trillion in assets under management. Since I have a healthy skepticism of anything the financial “services” industry is selling I decided to give it a read. It was very informative, partly due to a complete fundamental ignorance of basic economics, but also because of an obvious contradiction with the author’s stated assumptions.

As I mentioned to my friend in a private message, I see the same fallacious arguments repeatedly within the housing industry. America is great, deficits and debt don’t matter. Rah, Rah, Rah! I get it. It’s a sales oriented business. What concerns me is when people put their hard-earned money into housing or any other supposed store of value thinking that the sky is the limit. We are living in an age of epic distortions, misinformation and outright fraud. Apparently we learned absolutely nothing from the Great Recession, save for the government and Federal Reserve’s determination/ability to cover it up and pretend like nothing ever happened.

As I was writing about the shortage of affordable new homes this morning, I couldn’t help but think about how we arrived here and how the transgressions leading to the last housing crash have been completely swept under the rug. This is not to say that the responses after the housing crash have been any better. We are now surrounded by banks which are larger than ever even as they continue to break the law racking up huge fines that amount to nothing but a slap on the wrist while the CEO reaps a huge payday. Criminality within the U.S. banking system is now a feature, not a bug. This should not be surprising considering the events of the last decade.

Letter: Wells Fargo $1-billion fine too small to rein in fraud

Getting back to the issue of affordable homes, one of the long cons on the American public continues to be the epic policy failures of the Federal Reserve that facilitated the destruction of the U.S. housing market as they buried the idea of “affordable” homes for the sake of their Wall Street roots. When a smallish, aging 3-bedroom, 2-bath detached home in need of repairs becomes a bidding war for the next young couple who just wants a decent roof over their head, that’s not exactly a healthy housing market or a healthy economy. It’s a sign that something is seriously out of whack with our priorities.

Back in January money manager James Stack was making a prescient warning about an overheated housing market, pointing out the excesses and irrational exuberance that were driving home prices and valuations of many builder stocks to extremes. He also keyed in on one of the most critical factors igniting the last housing downturn…The Fed.

“The last downturn came about when economic growth slowed after a series of rate increases, exposing the “rot in the woodwork” and prompting loan defaults.”

While the Federal Reserve continues to claim the U.S. economy is at or near “full employment”, many Americans know different. They know a con when they see one.

“Based on their analysis of the labor market, our economists continue to believe that, while improvements can be made in increasing employment, we are likely at or already past “full employment” in the U.S.” Robert Kaplan

For Kaplan and other Goldman Sachs alumni I’m sure the U.S. economy is pretty close to full employment. Working for the Vampire Squid pays pretty well. For middle America and anybody not in the top 10 percent of wage earners, there is a whole other story to discuss. It’s a conversation the Fed would rather not have of course. The first rule of fight club is that you do not talk about fight club.

The Federal Reserve is now embarking on a policy “normalization” to reduce it’s huge balance sheet This quantitative tightening is already spooking markets and causing ripples within the housing market itself. Now that the Fed is finally pulling back the punch bowl, after nearly a decade of fueling Wall Street’s greed, interest rates are beginning to rise and new U.S. homes are now more UNaffordable than they have ever been compared to median U.S. wages.

Of course the Federal Reserve’s army of economists will summarily dismiss the Fed’s culpability for the wreckage they have caused, but the Devil is in the details. There’s a reason the Fed is taking a sloth-like pace with their balance sheet reduction. We are now more than 6 months into this monetary adventure and the Fed hasn’t even drained off $100 billion from their balance sheet…

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If the U.S. economy were really that healthy and we were truly at or near full employment, the Fed would have no problem at all draining off $85 billion per month, the same amount they were adding back in 2013 with QE-3!

While the Federal Reserve and other central banks have been busy inflating their balance sheets and virtually every asset under the sun, they have also been accelerating wealth and income inequality in the process as asset price inflation has far outpaced wage inflation…

3

It should go without saying that Federal Reserve officials are somewhat lacking in the credibility department. This should come as no surprise. If they were completely honest with the American public, I suspect Congress would be forced to revoke their charter. Author and Wall Street veteran Nomi Prins expounds on the collusion among central bankers…

“Two months later, I found myself sitting in front of a room filled with central bankers from around the world, listening to Fed Chair Janet Yellen proclaim that the worst of the crisis and its causes were behind us. In response, the first thing I asked that distinguished crowd was this: “Do you want to know why big Wall Street banks aren’t helping Main Street as much as they could?” The room was silent. I paused before answering, “Because you never required them to.”
Nomi Prins

If you are out shopping for a home during this summer selling season and you are having a difficult time finding a good property at a reasonable price, be sure to thank the folks at the Fed for their fine work. Destroying a market takes some effort, particularly if you account for all of the PR necessary to cover your tracks. The Federal Reserve and their army of economists have created another fine mess in the U.S. housing market, destroying real price discovery and distorting the real value of a home which is end-user shelter.

By Aaron Layman| April 27th, 2018

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