Housing Starts

Housing Starts Bounce As Permits Surge Most In 5 Years On Multi-Family Spike

Housing Starts rose 10.5% in November (after plunging 12% in October) as it appears weather-weakened construction caught back up with single-family starts recovering from the plunge in October. The South saw the biggest spike (up 21%) and Northeast fell 8.5%. Building Permits rose 11% MoM (after a 5.1% last month) as multi-family spiked from 446 to 566 (driven by a 22% spike in The Midwest and The West). This is the biggest MoM gain since Dec 2010.

Global Stocks, US Futures Greet Historic Fed Day With Euphoria

The day has come when the boxed-in Fed has no choice: with the vast majority of the market expecting a rate hike, Yellen has to deliver or suffer a crushing confidence blow like no other. And deliver she will, with expectations that said hike will be "as dovish as possible." For now however, the market is desperate to convince itself that just as more easing and more QE were bullish for the market, so rate hikes are just as bullish. Recall from late 2013: "tapering is not tightening," then the 2015 version of this refrain is "tightening is not tightening."

Key Events In The Coming "Fed's First Hike In 9 Years" Week

While this may well be the most important week for capital markets in the past 9 years, when the Fed is widely expected to hike rates on Wednesday, precisely 7 years to the day since it cut rates to zero, here are the other key events to watch out for.

Goldman's Meteoronomists Have A Dire Forecast: "Winter Is Coming"

With the winter of 2015 so far shaping up to be what some have dubbed "abnormally hot", we thought that at least this year the weatherconomists would keep their mouth shut: after all, if you blame cold weather for an underperforming economy, you better say nothing at all if the weather is warmer than usual as it has been in October and November. Alas, it was not meant to be, and so, without further ado, here are everyone favorite economweathermen from Goldman Sachs, warning everyone that, drumroll, yes, Winter Is Coming.

Global Markets Surge Overnight On Fed Minutes Optimism; ECB Minutes Set To Keep Rally Going

While it is still unclear just why the FOMC Minutes which are said to have made a December liftoff "more likely" unleashed a dramatic market rally, one which sent both stocks and TSYs higher, the sentiment continued overnight, with both Asian stocks surging on the US momentum, as well as Europe, where the DAX gapped solidly above the 200 DMA as most European shares advanced, led by resources, travel stocks. U.S. futures continue their ramp higher, and at last check were another 8 points, or 0.4%, in the green.  But if the Fed Minutes were enough to unleash the latest leg in this rally, than the ECB's own minutes due also today, should send futures back over 2100 without much difficult, regardless of their actual content.

Housing Starts Plunge To 7-Month Lows As Rental Units Tumble

With new and pending sales tumbling and lumber prices down, yesterday's drop in homebuilders sentiment - from 10 year highs! - appears justified entirely now as Housing Starts collapsed 11% in October to the weakest level since March. This is the biggest miss (and MoM drop) since Feb. Multi-family  unit starts plunged 25.5% MoM as single-family dropped just 2.5%. Starts in The West and South plunged as The Midwest saw a 30.8% collapse in housing completions. Building Permits rose 4.1% after tumbling 4.8% in September but SAAR remains notably below the Q2 cycle peak levels (1.337mm) at around 1.15mm homes (with multi-family permits rising 6.8% MoM).

Global Stocks Tread Water After Two Consecutive Terrorist Scares; Oil Rises, Industrial Metals Tumble

If this weekend's gruesome terrorist attack on Paris ended up being hugely bullish for stocks, then two subsequent events, a stadium-evacuation scare in Hannover (where Angela Merkel was supposed to be present) and a raid in north Paris which left several dead in the ongoing manhunt against the alleged ISIS mastermind, appear to have but some question into if not stocks then algos whether a rising wave of terrorist hatred across Europe is truly what central bankers need to unleash more QE. That said, we expect the current weakness to last only until the traditional USDJPY carry ramp pushes stocks traditionally higher.

Stocks Jump On Hope For More Central Bank Intervention After Japan's Quintuple Recession, Syrian Strikes

As so often happens in these upside down days, was the best thing that could happen to the market, because another economic slowdown means the BOJ, even without sellers of JGBs, will have no choice but to expand its "stimulus" program (the same one that led Japan to its current predicament of course) and buy up if not government bonds, then corporate bonds, more ETFs (of which it already own 50%) and ultimately stocks. Because there is nothing better for the richest asset owners than total economic collapse.

The Bubble Finance Cycle - What Our Keynesian School Marm Doesn’t Get, Part 1

The world of Bubble Finance economies created by the Fed and other central banks is fundamentally different than that prevailing under the “Lite Touch” monetary policies which preceded the Greenspan era. The problem today is that the PhDs running the Fed have an economic model which is a relic of the Lite Touch era. It is not only utterly irrelevant in today’s casino driven system, but is actually tantamount to a blindfold. It causes them to look at a dashboard full of lagging indicators like jobs and GDP components, while ignoring the explosive leading indicators starring them in the face on CNBC. The clueless inhabitants of the Eccles Building do not recognize that they have created a world in which Wall Street supersedes main street.

Euro Crushed By Draghi's Latest "Whatever It Takes" Moment; Fed Speaker Barrage On Deck

The biggest event overnight came from Europe, where Draghi managed to once again jawbone the Euro lower by ober 50 pips when he told European lawmakers in a prepared testimony that downside economic risks are "clearly visible," repeating his October press conference statement, adding that the ECB will reexamine degree of accommodation in December as "inflation dynamics have somewhat weakened." And the statement that crushed the Euro: "If we were to conclude that our medium-term price stability objective is at risk, we would act by using all the instruments available within our mandate to ensure that an appropriate degree of monetary accommodation is maintained." I.e., another "whatever it takes" moment.

Case-Shiller Home Price Appreciation 'Stable' At Around 5% YoY

For the first time since April, Case Shiller Home Prices rose month-over-month (though barely at +0.11%). However, this very modestly better than expected print was all thanks to downward revisions of previous data. San Francisco continues to lead the 20-city index with a 10.7% YoY gain. This is the 6th month in a row in which year-over-year gains are basically stagnant at +5%

Key Events In Another Central Bank-Dominated Week

Last week it was all about central banks, when both the ECB and the PBOC unleashed a massive market rally. This week it will be about even more central banks, this time the Fed, which won't hike, and the BOJ, which may but most likely won't as the Fed and the ECB already did its work for it, sending the Yen tumbling with their actions and/or jawboning.