What I’m Reading
Warning Sign: China’s property market accounts for a massive % of global commodity consumption. Chinese housing starts have now fallen 17% or more for three consecutive quarters. Looks like a commodity downturn could be in the cards. Financial Times
Mean Reversion: Soaring mortgage rates have resulted in demand for second homes in the US dropping to its lowest level since May 2020. However, demand is still above where it was before the pandemic hit. Bloomberg
Good News / Bad News: Cash buyers, owners locked in at lower interest rates and institutional investment flows make a housing crash unlikely in light of spiking mortgage rates. The downside of this is that the Fed’s primary policy transmission is housing. If it proves resistant to rates, the Fed tighten more aggressively than current forecasts suggest. Calculated Risk
Bracing for Impact: If China’s disruptive lockdowns persist, they could fuel global inflation, slow the pace of exports shipped from the ‘world’s factory’, and weaken demand in the world’s largest consumer market. China Macro Economy
Pulling Ahead: Walmart and Google’s Wing are leaving Amazon in the dust when it comes to drone delivery. Full Stack Economics
Leveling Off: After 17 straight months of increases, the headline rate for US commercial real estate property price growth finally slowed between February and March 2022, according to Real Capital Analytics. The company’s CPPI national all-property index dropped 0.4% was the first month-over-month decrease since June 2020. However, the index was still up 17.4% over the previous year. Globe Street
Chart of the Day
Positive correlation between is very unusual.
Source: Liz Ann Sonders
WTF
Proud Dad Moment: A sheriff ended up arresting his daughter during an undercover meth bust because Florida. (h/t Steve Sims) Miami Herald
When You’ve Gotta Go: Faced with a locked bathroom at a convenience store, a man decided to instead relieve himself inside the business’s beer cave, ruining $113.36 in merchandise because Florida. The Smoking Gun
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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