• Debt Dynamic

    While Friday’s Treasury announcement that the debt limit will be breached on 1/19/23 is concerning, the Treasury will again employ “extraordinary measures” to keep the government functioning through early June. If the ceiling isn’t raised by then, watch out. With the House in Republican hands and … [Read More...]

  • Rent Reversal

    After climbing 2%/month in spring and summer 2021, and 1.5%/month in spring and summer 2022, in 9/22 M-o-M rents began falling. Since 10/22, all major rent indices have shown M-o-M rents falling, with the declines increasing and by well more than seasonal norms. In 11/22 national rents declined by … [Read More...]

  • Petroleum Profits

    While releases from the Strategic Petroleum Reserve totaling 180 million barrels will soon end, the benefits may not. The releases, intended to lower pump prices and which came under political pressure, were sold for an average price of $96.25/bbl. With crude prices now $74.29bbl, the U.S. is up … [Read More...]

  • Soccer Score

    Looking at all World Cup winners from 1962 through 2018, economic analysis suggests winning the WC boosts domestic GDP by at least 0.25% in the two subsequent quarters primarily due to export growth. For example, 1.12 billion people watched the 2018 WC final and that increased exposure boosted … [Read More...]

  • First-Time Financing

    With mortgage rates dipping last week by 24bps to 6.9%, the largest decline since July 2022, and home prices trending down since peaking in June, first-time mortgage applications spiked a pleasant 4.4% W-o-W for the week ending 11/11/22. Still, they remain down 39.9% Y-o-Y. As for refinancing, … [Read More...]


Dental Dollars

The Friday File: During 2022, the average amount left by the Tooth Fairy per lost tooth was $6.23, up from $5.36 in 2021, a solid rise of 16%. The Tooth Fairy was most generous in the South leaving $6.59, followed by the West at $6.25, the Northeast at $6.14 and the Midwest at just $5.63. That … [Read more...]


Dwelling Dollars

We are entering peak home selling season. The months with the highest premiums over asking price are March (8.9%), April (9.2%), May (12.6%), June (10.7%), and July (10%). The five days when sellers are likely to receive the highest premium over asking price all happen during the third and fourth … [Read more...]


Wild Wheels

Used-car prices are down 7% Y-o-Y, but up 4.3% M-o-M, the third month in a row of M-o-M increases, and the largest February rise since 2008. The car market remains about five million units short from the computer chip shortage, which is lessening. A short-term price driver is always seasonality, but … [Read more...]


Limited Labor

As recently as 1980, it took S&P 500 firms, on average, eight employees to produce $1 million in inflation-adjusted revenue. By 1990, it was six people, and by 2000, four. Lest you think productivity slowed, by 2010 it took just 2.5 workers and today it takes just 2. Over the last forty years, … [Read more...]


Limited Lessening

Monetary policy works most quickly via the most interest rate sensitive sectors of the economy, autos and housing. However, for very different reasons, both sectors have successfully resisted the impact of higher rates. Car sales are rising as semiconductor supply improves, and while housing starts … [Read more...]


Traffic Trouble

The Friday File: The city with the worst traffic is London where the average travel time per 10 kilometers (6.21 miles) is 36 minutes 20 seconds. In second is Bengaluru, India at a time of 29 minutes 10 seconds. Third is Dublin at 28 minutes 30 seconds. New York is 19th at a zippy 24 minutes 30 … [Read more...]


Rate Readings

22Q4 GDP came in at 2.7%, down from 3.2% in 22Q3, primarily due to softening consumer spending, suggesting weakening. However, in January the Fed’s favorite inflation measure meaningfully rose, with December’s reading being revised upwards. Consumer spending jumped 1.8% M-o-M, the largest rise in … [Read more...]


Venture Variations

Venture-capital firms raised a grand total of $20.6 billion in 22Q4, a 65% decline from a year ago, the lowest fourth-quarter amount since 2013, and returns fundraising to levels last seen in 2015. It was also less than half the amount raised in 22Q3, and the first time fundraising levels declined … [Read more...]


Clearly Core

The Fed is currently focusing on what is called super-core inflation, defined as overall CPI minus food and energy, goods, and housing. Food and energy are 11% of consumer spending, housing is 16%, and goods are 24%. Thus, super-core inflation includes 49% of overall consumer spending. It’s now … [Read more...]


House Hunting

Home sales eased for the 12th straight month in 1/23, the longest streak of monthly declines since 1999 when data collection began. Sales fell to a seasonally adjusted annualized rate of 4 million, from 4.03 million in December, and 4.1 million in November. The increasingly tiny declines suggest the … [Read more...]