What I’m Reading
Booming Boomers: Covid-19 kept many older Americans on the sidelines of the recovery in consumer spending as they held back from in-person services like dining and travel despite seeing their wealth increase dramatically. But their spending is picking up as the Omicron wave recedes, and analysts say that could help fuel economic growth in the months ahead. Wall Street Journal
Shoe Drop: JLL estimates that over time state and local governments could shrink their office footprints in leased privately owned buildings by 25% or 30% due to COVID-spurred consolidation and hybrid work schedules. This is obviously not going to help office occupancy and a lot of government offices aren’t exactly the sort of quality that will lease up quickly. Wolf Street
Is the Bottom In? Housing inventory typically declines in winter and then increases in the spring. It appears that inventory bottomed seasonally at the beginning of March. Calculated Risk IMO, any increase in inventory will face some headwinds early on due to the lock in effect of rapidly rising mortgage rates.
What to Watch: When it comes to the yield curve, the best indicator to watch is the Overnight Index Swap (OIS) curve, not treasuries themselves. The best curve shapes to watch are the 30y vs 5y and 10y vs 2y. Both are essentially zero today. The Macro Compass
Stacked: Vertical warehouses solve space issues in densely populated areas with high land values but cost a lot to build. As a result, they can require rents as high as $30/sf to justify building. Globe Street
Chart of the Day
Its a decent time to do a 5/1 ARM…..if you aren’t risk averse.
Source: Len Kiefer
WTF
Exposed: A man was arrested for flashing five people in a Panera Bread restaurant because Florida. NBC2
Whip It Out: A 27-year-old man who identified himself as a “homeless model” is facing criminal charges for masturbating in public view at a Starbucks because Florida. Local10
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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