Housing Bubble

What Killed The Middle Class?

If the four structural trends highlighted below don't reverse, the middle class is heading for extinction.

"Free" Trade, Jobs, & Income Inequality: It's Not As Easy As We Might Think

Slapping fees on imports (which by the way is illegal in treaties such as the WTO) will not solve the larger problems of reduced employment, stagnant wages and rising income inequality. To make a dent in those issues, we'll need to tackle central bank and central-state policies that have pushed finance and speculative churn to supremacy over the productive economy.

Global Stocks Levitate Despite Ongoing Oil Weakness; China Stocks Jump After Easing Margin Debt

At the same time as the PBOC was cautioning about the dangers of excess debt (just as it injected a record amount of loans into the financial system), China's central bank warned about dangers from a stock market bubble, and perhaps just to assure the bubble gets even bigger, at the same time China eased on margin debt limits, in the process sending Chinese stocks soaring higher by 2.2%, and pushing the Shanghai Composite over 3000 for the first time in months as China now appears set to attempt another housing bubble "soft landing" while at the same time restarting its housing bubble.

The Stunning Size Of China's Housing Bubble In One Chart

Nothing does China's housing bubble justice quite like a simple chart showing what is going on right now with home prices in Shenzhen, which incidentally also puts the housing bubble in the context of China's recently burst stock market bubble. No comment  necessary.

On Opex Day, It's All About The Dollar: Futures, Oil Levitate As USD Weakness Persists

It may be option expiration day (always leading to abnormal market activity) but it remains all about the weak dollar, which after crashing in the two days after the Fed's surprisingly dovish statement has put both the ECB and the BOJ in the very awkward position that shortly after both banks have drastically eased, the Euro and the Yen are now trading stronger relative to the dollar versus prior. As DB puts it, "the US Dollar has tumbled in a fairly impressive fashion since the FOMC on Wednesday with the Dollar spot index now down the most over a two-day period since 2009" which naturally hurts those countries who have been rushing to debase their own currencies against the USD.

Norway Cuts Rates, Hints At NIRP, QE As Central Bank Falls (Way) Behind In FX Wars

Facing pressure from competitive easing at the ECB, the Riksbank, and the NationalBank, and with low oil prices weighing on the economy even as the dynamics of fiscal stimulus force the Norges Bank to be a reluctant buyer of NOK, Norway relents, cutting rates by 25bps and hinting at further cuts to come. 

P2P Property Lending Explodes In China; Officials Panic

“Funds used for down payments cannot be borrowed." You might think that what’s implied there is too bad to be true - even in the increasingly ludicrous world of P2P and marketplace lending. But in fact, P2P lenders in China have indeed been funding down payments on homes, embedding an enormous amount of excess leverage into the market while simultaneously driving up prices in Tier-1 cities.

A Rigged And Rotten System

The whole shebang is rigged and rotten – including the financial system. The typical voter doesn’t understand why or how. Who does? But he feels it. Something is wrong; he knows it. And more and more, he wants to say so.

"Gloom" Returns To China's Economy: Industrial Production, Retail Sales Miss Lowest Estimates

Factory output grew just 5.4% in January and February from a year earlier, data released by the National Bureau of Statistics (NBS) showed, slowing from a 5.9% rise in December to the weakest since November 2008; the print matched the lowest Wall Street estimate. Meanwhile, retail sales rose 10.2% over the two-month period from a year ago, below the lowest Wall Street estimate of 10.5%, and far below the December’s 11.1% increase, pushing the trend growth in this series to lows not seen since early 2015.

What The Average Zhou Thinks Of China's Housing Bubble: "Only After War Breaks Out, We'll Be Able To Afford It"

"[the empty homes] belong to the real estate speculators, the hoarders and the corrupt officials... It's just a game for the rich! Beijing isn't a livable city at all. The price makes it off-limits. It’s also a food chain: Only the richest and most capable people can live here... The housing market is part of the bubble economy. In 5 years or so, after a war has broken out, then the middle class will be able to afford a home."