Fresh Hope from A New Peak in Mortgage Rates – Housing Market Review

fresh hope (Credit: kitty.green66 on Flickr)

Housing Market Intro and Summary Real estate is local. Regional banks often sit at the heart of local communities. So it seems odd writing about the relative strength in the housing market in the wake of the Panic of 2023 that featured the historic collapse of two regional banks, Silicon Valley Bank (SIVB) and Signature … Read more

A Bullish Bear Market – The Market Breadth

bullish bear (Credit: ell brown on Flickr)

Stock Market Commentary: This stock market is one bullish bear market. A bear market perhaps cannot get more bullish than the current market. Since the October lows, the various indices have shown a general upside bias. As much time that I have spent the last several weeks looking for excuses to get bearish, the market … Read more

What Recession? Market Shows Love As Apple Leads the Way – The Market Breadth

What Recession?

Stock Market Commentary: Once again, Apple Inc (AAPL) became a poster child of market sentiment. When AAPL pulled away from resistance at its 50-day moving average (DMA) (the red line below), the move looked like a tease with bear market conditions still in force. Two weeks later, AAPL emerged vindicated as a 3.3% post-earnings gain … Read more

Why Wall Street Wants A Recession

Jerome Powell at the Reservation Economic Summit

That sigh of disappointment was Wall Street looking for signs of a weakening labor market in the June jobs report. Instead, that report showed job creation remains robust in the economy. Not only did the unemployment rate remain steady at a low 3.6% with the economy adding 372,000 jobs (far more than “consensus” expectations), the … Read more

The Easy Way to See Why the Stock Market Fears Rate Hikes

It is easy to forget that the months going into the COVID-19 pandemic were filled with fears of a recession. In response to mounting economic and political pressures, the Federal Reserve, led by Jerome Powell, reversed course on the Fed’s 3-year effort to slowly normalize monetary policy with what he called a “mid-cycle” rate adjustment. … Read more

Inflationary or A Bubble – Housing Prices Help Push A Fed Driving Recession-Pricing for Home Builders

Two recent studies from the Federal Reserve say a lot about its core concerns for inflation. These studies were released back-to-back just one week following Fed Chair Jerome Powell confirming the new religion at the Fed for (aggressively) fighting inflation. Researchers at the St. Louis Federal Reserve identified housing services (aka rents) as a core … Read more

Part Optimism, Part Skepticism from A Partial Trade Deal – Above the 40 (October 11, 2019)

AT40 = 52.4% of stocks are trading above their respective 40-day moving averages (DMAs)AT200 = 48.1% of stocks are trading above their respective 200DMAsVIX = 15.6Short-term Trading Call: cautiously bearish Stock Market Commentary A Broad-Based Re-Entry Two Fridays ago, buyers took the S&P 500 (SPY) back above its 50-day moving average (DMA). It was yet … Read more

How to Understand the Inverted Yield Curve and Its Relationship to Recessions

The Federal Reserve’s program of monetary tightening has been fighting the bond market since the process began about 3 years ago. Over that period, the Fed has painstakingly tried to hike rates in a way that would avoid roiling markets. Unfortunately for the Fed, long-term rates on U.S. Treasuries failed to cooperate and barely budged … Read more

The Relationship Between Recessions and Housing Starts

The latest airing of Marketplace included a segment titled “Making sense of housing market data.” The segment explained the five key housing data points that Marketplace uses to gauge the health of the housing market: housing starts, new home sales, existing home sales, pending home sales, and the Case-Shiller Home Price Index. In my monthly … Read more

The Fed-Related Chart That Most Concerns the Stock Market

An on-going debate rages about whether or how fast the Fed should hike rates in 2019. Some even question the need for a rate hike in December. Indeed, the market has priced in a “only” a 65% chance of a rate hike next month. I say only because before the October sell-off and November’s weakness, … Read more