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Perfectly Normal Markets- 4/28/23

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The past two days are a perfect example of free markets functioning normally. 

Also, be careful what you wish for. Recessions are bullish. Because recessions are when the Fed loosens monetary policy. 

Finally, as my hero Joe Granville used to say, "What do earnings have to do with the stock market? Absolutely nothing!" 

And a hearty, "Bonjour et bonne chance," to you from nice Nice France! More upcoming. 

Meanwhile, here's the hourly ES, 24 hour S&P fucutures illustrating market fucktioning normally. 

image.png

The 5 day cycle has topped out. But what shape the down phase? Flat, or down in absolute terms. Aye, there's the rub! 

For moron the markets, see:

If you're serious about the underlying forces of supply and demand that drive the markets, join me!

If  you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam folder. 

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L&L, Mitsubishi Default on $93M Loan for Metropolitan Offices
GlobeSt.com|20 hours ago
As a wave of more than $16B in CMBS loans backed by New York City office buildings comes due in 2023, office assets with plunging valuations that can’t be refinanced because the lending window has shut are beginning to topple into default like dominoes.

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38 minutes ago, Jimbo said:

RENAME THE FED

It needs to be renamed BRAD.

The Bank Replacement Agency for Deposits.

The Bank of Japan is even worse. Now owning 54% of JGBs it is lending like crazy to banks so they can buy up JGBs that are going to crater in value fact 3.4% inflation and they risk that the BoJ can't keep the peg on rates any longer. 

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Here we go again:

 

“After years of leading the nation in home price growth, the Phoenix metro is now dipping into the red. If you drive, you’ll notice ‘for sale’ signs popping up across the Valley, but we know prices just aren’t as high as they used to be. It has now joined seven other metros across the country in the same boat including Denver, Las Vegas, Los Angeles, Portland, San Diego, San Francisco and Seattle. ‘The main reason why home prices are going down is because homes are staying on the market for longer, so that’s why sellers are lowering their prices to get people to buy,’ said Luis Cordova with Rounds Consulting Group.”

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The West Coast COVID-19 diaspora now putting those big price increases into reverse:

“Reno posted a record high median home sale price of $635,000 in June 2022 for an existing home, almost doubling the median price of $320,000 from January 2017, according to Sierra Nevada Realtors. The Reno median price has since fallen to $555,000 in March this year due to a rebalancing of the market from rising interest rates but remains unaffordable for many households in the city. Sparks reached a record high of $570,000 in May 2022. The median home sale price for Sparks in March this year was $502,500, according to Sierra Nevada Realtors. Las Vegas, meanwhile, reported a median home price of $425,000 in March, according to Las Vegas Realtors. Las Vegas’ median home sale price reached as high as $482,000 in May 2022.”

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We're just getting warmed up on CRE defaults:

 

“Panoramic Development has skidded into loan default for a proposed highrise to contain more than 1,000 homes in West Oakland. The San Francisco-based developer defaulted on a $6.25 million debt for CitySpaces at 500 Kirkham Street, the East Bay Times reported. The development was to include 1,032 apartments and 35,000 square feet of shops and restaurants, offices and a grocery store. Now the property faces loan delinquency, default and possible foreclosure.”

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Quote

Welcome to Western Hills Estates! SEE THE VIDEO ABOVE!! easy to show. .. . Introducing YUCCA PARADISE! OFFERED to you to purchase fully furnished as a turnkey short-term rental property. This property is a very successful AirBnB and booked up most of the year! 

https://www.redfin.com/CA/Yucca-Valley/57288-Farrelo-Rd-92284/home/3823821#marketing-remarks-scroll

Price cut today from $695K to... $694K.  LOLOLOL... a thousand bucks to refresh it on the MLS.

Transacted:

04/2018 for $273K

05/2016 for $251K

10/2012 for $215K

09/2007 for $317K  <== "NINJA" era.....

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27 minutes ago, Jimi said:

https://www.redfin.com/CA/Yucca-Valley/57288-Farrelo-Rd-92284/home/3823821#marketing-remarks-scroll

Price cut today from $695K to... $694K.  LOLOLOL... a thousand bucks to refresh it on the MLS.

Transacted:

04/2018 for $273K

05/2016 for $251K

10/2012 for $215K

09/2007 for $317K  <== "NINJA" era.....

I'm sure this "work-from-home" clown will get over asking....

 

Not

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The Fed Is Predicting a Recession: Here's What 95 Years of History Says Stocks Will Do Next | The Motley Fool  By Sean Williams – Apr 19, 2023

"Looking back 95 years (since 1927), there have been 15 separate stock market drawdowns associated with U.S. recessions. Bank of America (BofA) Global Research examined the S&P 500's maximum drawdown during each declared recession, as well as the maximum drawdown during recessions from one year prior to a recession being declared.

The result of 95 years of data is crystal clear: Approximately two-thirds of all downside in the S&P 500 occur during a recession and not prior to one being declared by the eight-economist panel of the National Bureau of Economic Research (NBER). If we assume that the FOMC is correct in predicting a mild recession for later this year, the implication of this data would be that the Dow, Nasdaq, and S&P 500 haven't yet seen their lows."

To add to this point, independent investment research company Ned Davis Research found that no bear market has bottomed after World War II prior to a recession being declared by the NBER. On average, the stock market bottoms just shy of six months after a U.S. recession officially begins.

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Bitcoin supply is designed to be capped at 21 million.

This finite-supply imposes a scarcity that affords it great intrinsic value that many don't recognize.

One should be buying bitcoin today because of that.

Someday, Giant Meteor will slam into the planet, destroying human civilization in its entirety.

Such eventuality imposes a finite-supply on equities that afford great intrinsic value that many don't recognize.

One should be buying equities today because of that.

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