Capitalism, The Fed and Economic Policy

The Juggler

The fed is walking a tight rope. They will either lead us into a soft inflation or successfully tame inflation. I think, if anything, the fact that inflation has been receding while still maintaining this kind of job growth is encouraging...albeit a bit strange.

mickeyrat

The Juggler said:

The fed is walking a tight rope. They will either lead us into a soft inflation or successfully tame inflation. I think, if anything, the fact that inflation has been receding while still maintaining this kind of job growth is encouraging...albeit a bit strange.

Makes me wonder if they knew what the fuck they were talking about to begin with. Their claim has been what we've have been experiencing was impossible right?

static111

mickeyrat said:

The Juggler said:

The fed is walking a tight rope. They will either lead us into a soft inflation or successfully tame inflation. I think, if anything, the fact that inflation has been receding while still maintaining this kind of job growth is encouraging...albeit a bit strange.

Makes me wonder if they knew what the fuck they were talking about to begin with. Their claim has been what we've have been experiencing was impossible right?

I believe the older I get that we are all just a bunch of kids playing dress up and the whole thing is guesswork.  If it works people take the credit, and if it doesn't the blame gets shifted.  I don't think anyone knows what the fuck they are talking about ever, but it is entertaining. And it is nice when your side of the no one knows what the fuck they are talking about brigade has a win.

tempo_n_groove

static111 said:

mrussel1 said:

static111 said:

Psh. starter homes 500,000 in Austin.  @ around 7% that seems like robbery.  Also the payments on that would be crazy for most people.  Looks like we are gonna keep renting. I'm glad things are getting better though.
tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

This is a supply issue,  not an interest rate one.  The higher the interest rate,  the more inventory,  the lower the price.  But that's not going to happen until more homes are built (or apts).

Yes I agree completely, however the higher interest rates do nothing for the long term cost.  This problem has been exacerbated by people from high rent areas selling their million dollar plus homes then moving here and buying several homes paying in cash and using the rest of the homes as rent generators.  As well you have investment firms buying up single family homes as revenue generators as well.  A big part of the issue is that there are homes, they are just being used as rental units.

This doesn't seem like healthy economics.  Far be it from me to try to put limits on who can own how many homes and for what purposes, but when some people own 4 or more while driving up the perceived value of what is available to people that don't own one, that does not seem like a fair playing field.  Not to mention that there is the possibility that someone buys high and the market fails again.

Being that this is the Capitalism, the Fed and Economic Policy, I think that this is still a relevant conversation.

THIS^

I've been screaming this for a while now.

tempo_n_groove

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

The Juggler

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

The Juggler

mickeyrat said:

The Juggler said:

The fed is walking a tight rope. They will either lead us into a soft inflation or successfully tame inflation. I think, if anything, the fact that inflation has been receding while still maintaining this kind of job growth is encouraging...albeit a bit strange.

Makes me wonder if they knew what the fuck they were talking about to begin with. Their claim has been what we've have been experiencing was impossible right?

Who knows? To be fair, there was a once in a lifetime pandemic that completely altered the entire globe for a couple years or so. Can't be easy to know exactly how to handle all that came of that I guess...

nicknyr15

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

Yes my favorite thing when I used to do mortgages were the phone calls asking why our mortgage rates aren’t down when the feds cut interest rates. 🙄🙄. Good times. 

tempo_n_groove

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

tempo_n_groove

nicknyr15 said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

Yes my favorite thing when I used to do mortgages were the phone calls asking why our mortgage rates aren’t down when the feds cut interest rates. 🙄🙄. Good times. 

It's all connected though even if not directly.

mrussel1

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

The Juggler

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

The Juggler

nicknyr15 said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

Yes my favorite thing when I used to do mortgages were the phone calls asking why our mortgage rates aren’t down when the feds cut interest rates. 🙄🙄. Good times. 

Yep. All the time. lol

tempo_n_groove

The Juggler said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

They actually lowered rates because buying came to a standstill.  They had to do something.  It's still not good enough though.

mrussel1

The Juggler said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

They are market driven,  but a clear correlation between the two.  

The Juggler

tempo_n_groove said:

The Juggler said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

They actually lowered rates because buying came to a standstill.  They had to do something.  It's still not good enough though.

 The fed hasn't lowered rates since early on in the pandemic. They increased rates 5 times during the timeframe in the chart above. 

If you are talking about mortgage rates-- they dipped during this same timeframe largely due to the bond market. The bond market is basically trying to anticipate what's going to happen long term. Either a recession or successfully taming inflation without substantial job losses will spell good news for mortgage rates because that's an indication that the fed will eventually cut rates down the road in either of those scenarios. Future increases are baked in too. Watch what happens the next time Powell announces a rate increase. If it's the anticipated .25% again, I bet mortgage rates will like decrease slightly. My company is anticipating them to go down this summer. But who the hell knows?!

tempo_n_groove

The Juggler said:

tempo_n_groove said:

The Juggler said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

They actually lowered rates because buying came to a standstill.  They had to do something.  It's still not good enough though.

 The fed hasn't lowered rates since early on in the pandemic. They increased rates 5 times during the timeframe in the chart above. 

If you are talking about mortgage rates-- they dipped during this same timeframe largely due to the bond market. The bond market is basically trying to anticipate what's going to happen long term. Either a recession or successfully taming inflation without substantial job losses will spell good news for mortgage rates because that's an indication that the fed will eventually cut rates down the road in either of those scenarios. Future increases are baked in too. Watch what happens the next time Powell announces a rate increase. If it's the anticipated .25% again, I bet mortgage rates will like decrease slightly. My company is anticipating them to go down this summer. But who the hell knows?!

Yes Mortgage rates, they went down when the buying stopped.  That is an interesting chart with he Tnotes and mortgages.  I'll have to follow that one too.

Mortgage rates will have to go down if they want the average person to own a home.

mrussel1

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

They actually lowered rates because buying came to a standstill.  They had to do something.  It's still not good enough though.

 The fed hasn't lowered rates since early on in the pandemic. They increased rates 5 times during the timeframe in the chart above. 

If you are talking about mortgage rates-- they dipped during this same timeframe largely due to the bond market. The bond market is basically trying to anticipate what's going to happen long term. Either a recession or successfully taming inflation without substantial job losses will spell good news for mortgage rates because that's an indication that the fed will eventually cut rates down the road in either of those scenarios. Future increases are baked in too. Watch what happens the next time Powell announces a rate increase. If it's the anticipated .25% again, I bet mortgage rates will like decrease slightly. My company is anticipating them to go down this summer. But who the hell knows?!

Yes Mortgage rates, they went down when the buying stopped.  That is an interesting chart with he Tnotes and mortgages.  I'll have to follow that one too.

Mortgage rates will have to go down if they want the average person to own a home.

Banks don't want people to buy homes. Their objective is to lend money at a better NPV vs the next best alternative.  They won't lend if the spread between the discount rate and the market rate is too low. They will do something else with the money.  So the fed rate is critical to the calculation.  When the fed raises the rate,  it's explicitly done to slow lending. 

tempo_n_groove

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

They actually lowered rates because buying came to a standstill.  They had to do something.  It's still not good enough though.

 The fed hasn't lowered rates since early on in the pandemic. They increased rates 5 times during the timeframe in the chart above. 

If you are talking about mortgage rates-- they dipped during this same timeframe largely due to the bond market. The bond market is basically trying to anticipate what's going to happen long term. Either a recession or successfully taming inflation without substantial job losses will spell good news for mortgage rates because that's an indication that the fed will eventually cut rates down the road in either of those scenarios. Future increases are baked in too. Watch what happens the next time Powell announces a rate increase. If it's the anticipated .25% again, I bet mortgage rates will like decrease slightly. My company is anticipating them to go down this summer. But who the hell knows?!

Yes Mortgage rates, they went down when the buying stopped.  That is an interesting chart with he Tnotes and mortgages.  I'll have to follow that one too.

Mortgage rates will have to go down if they want the average person to own a home.

Banks don't want people to buy homes. Their objective is to lend money at a better NPV vs the next best alternative.  They won't lend if the spread between the discount rate and the market rate is too low. They will do something else with the money.  So the fed rate is critical to the calculation.  When the fed raises the rate,  it's explicitly done to slow lending. 

Do you remember in oh, 2009-2011 when banks weren't letting people buy houses and unless you had a 900 credit score couldn't get a loan?

Banks know how to make money for sure.

Halifax2TheMax

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

The Juggler said:

tempo_n_groove said:

mrussel1 said:

tempo_n_groove said:

The Juggler said:

Could be in that 2% range by end of the year if this continues...

Doesn't help that the interest rates will still be really damn high...

It's not high.  I would argue that it's been too low too long.  

I actually agree on that but when prices of things skyrocketed and don't seem to be coming down that's a problem.

Average house on Long Island is just stupid...

But the prices of things are coming down though. That's what the chart is referencing. Still too high, but coming down none the less. 

Home values on the other hand...

Gas, sure, houses and cars?  Ain't seen nothin...  I've been wanting a new car for a while but I can't with these damn prices.  It's absurd.

Home prices aren't really about inflation. 

Car prices actually went down...so did bacon!
https://www.cnbc.com/2023/04/12/heres-the-inflation-breakdown-for-march-2023-in-one-chart.html

Houses are about inflation when the price stays but the interest rate doubles.

I don't know why NY hasn't got the memo on the price drops yet for the cars?  I'll be sure to let you know when I actually see that happen.

Well for new homes, yeah, as they're dependent on building supplies and stuff. 

The fed does not raise or cut mortgage rates. Mortgage rates are indirectly tied to the 10 year treasury note. Generally, mortgage rates are down about .75% in the last 6 months despite the fed raising key rates multiple times in that same timeframe. 

New homes? Shit, all home , Holmes.

The mortgage rates are in connection to the fed rates though.  The Fed raised interest rates and gosh darn it, the mortgage rates went up too.

Yes because the fed funds rate controls the rate at which banks borrow from each other.  So if that goes up,  banks must raise consumer interest rates,  unless they are suddenly into charity lending. 

Despite the fed raising key rates, what, 3 or 4 times recently, mortgage rates have fallen over the last 6 months.

I would bet we see rates back to mid 5's by the Fall....and housing prices continuing to rise. This would all be without any rate cuts by the fed. 

They actually lowered rates because buying came to a standstill.  They had to do something.  It's still not good enough though.

 The fed hasn't lowered rates since early on in the pandemic. They increased rates 5 times during the timeframe in the chart above. 

If you are talking about mortgage rates-- they dipped during this same timeframe largely due to the bond market. The bond market is basically trying to anticipate what's going to happen long term. Either a recession or successfully taming inflation without substantial job losses will spell good news for mortgage rates because that's an indication that the fed will eventually cut rates down the road in either of those scenarios. Future increases are baked in too. Watch what happens the next time Powell announces a rate increase. If it's the anticipated .25% again, I bet mortgage rates will like decrease slightly. My company is anticipating them to go down this summer. But who the hell knows?!

Yes Mortgage rates, they went down when the buying stopped.  That is an interesting chart with he Tnotes and mortgages.  I'll have to follow that one too.

Mortgage rates will have to go down if they want the average person to own a home.

Banks don't want people to buy homes. Their objective is to lend money at a better NPV vs the next best alternative.  They won't lend if the spread between the discount rate and the market rate is too low. They will do something else with the money.  So the fed rate is critical to the calculation.  When the fed raises the rate,  it's explicitly done to slow lending. 

Do you remember in oh, 2009-2011 when banks weren't letting people buy houses and unless you had a 900 credit score couldn't get a loan?

Banks know how to make money for sure.

Do you remember the sub-prime mortgage crisis? Oh, from 2007-2010?