So I wonder where this ends up by year end. I'm thinking between 3.5% to 4% but that may be on the high side depending on what the Fed does with the balance sheet. I think that puts mortgage rates at about 6-7% which is where I think it has to go if they want to slow the housing market.
At year end, if the 10 year is at 3.5% to 4% then that means the Fed is navigating a soft landing. Markets handling things pretty well, and no more shocks to the system. Powell said nobody really knows how the market will handle 100billion per month of QT, but expected it to act like an additional 1% hike.
I can see a path for a soft landing, but it requires a non nuclear, or non chemical weapon resolution to the Russian Ukraine war. We're gonna need energy markets to settle and no China surprises.
We might see which way the war goes in a few days, May 9th is suppose to be a victory day for Russia.
Thanos was the hero
Too many unknowns to predict 10 year rates. However, we're going into a heavy recession, possibly worse.
If you think the stimulus payments, PPP, etc. was the catalyst, you're wrong. It's the cheap corporate money.
They've been eating at the trough for way too long. Borrowing for stupid mergers, buybacks and more.
The old adage "Too Big to Fail" is about to become "Too Many to Help". Take defensive positions, be ready.
I think a light recession, an earnings recession. I don't think it will be that bad. The market will get used to QT, just might be from lower levels. I'm a slow small nibble buyer on days like today.
Thanos was the hero
It is not just the corporations. Alot of individuals overpaid for homes, borrowed too much, and bought alot of toys. I think this will eventually spill over into the real estate market once the job losses start. It is always the same pattern. People spend like the good times are going to last forever or their accounts are going to grow at 20% a year.Originally Posted by TampaJim
Non farm payroll and unemployment #'s that came out today weren't bad.
They were good but we are just starting this new cycle of interest rate increases. Normally it takes time for this to start affecting the economy. We are only in 2 rate hikes. I am more worried about the end of this year or next year.
Florida will be on sale within 18 months. Nearly everything purchased here in 2020, 2021 & thru this date ... way overpriced.
In 2008, about 1/2 the beachfront homes had for sale signs. It's was crazy, sick and laughable all at the same time. Oh well.
I remember reading FL had so much empty houses that caused a squatters epidemic. I don’t remember what got us out of the housing bubble burst? Was it the govt bailout?
It was Blackstone and other private equity firms buying houses out of foreclosure and buying tax deeds. That is how they became one of the biggest property owners. It never got much news coverage but they were one of the few buyers.
My in-laws bought their condo in 08. Paid pennies on dollar. Sold it in Jan of this year. Was on market for 2 days and got full asking price all cAsh deal. They were very happy to say the least with how that investment worked out for them. Their timing in both ends was very good.
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