30 year well above 6 again today: BEARISH

[gzz]

I am locked at 4.5 jumbo, but makes me nervous!

Amazing opportunity for lenders making prime high downpayment loans.

[Coronita]

Make up your mind about your predictions.

[gzz]

I am buying a house now for my newly retired parents to move to SD and to have a quieter area for my son. It could be a good time to buy, we had a price drop/rate spike in 2018-2019 that turned out to be a good entry point.

I certainly wouldn’t buy now as an investment given I already own 3 and am over invented in RE.

Best investment right now, by far IMO, are oil stocks. Pretty much any of them.

My portfolio now is about 1/3 oil stocks and I will go higher without hesitation on any dips. I also like coal stock BTU.

The downside on oil stocks IMO is about 25%, and that requires a recession to happen. OPEC will cut production if needed to maintain prices. And gas prices are at insane levels outside of producing and exporting nations like the USA.
Any dips I believe will be snapped up by shellshocked importers.

The upside for oil stocks is they right now have about P/E’s of about 5 based on Q2 oil prices. If they are sustained they will rise and do share buybacks and roughly double.

And less likely but very very possible scenario is 200+ oil and $15 NYMEX gas. That would result in oil majors like XOM probably quadrupling.

$200 sounds high but really isn’t when adjusted for income growth, lower energy intensity of GDP, and inflation. Obviously some sectors would hurt and consumers would grumble, but there wouldn’t be much demand reduction or 1970s level recessionary shock.

Now looking 5-10 years out, I think local RE will be a fine investment now. But at 6+ rates, prices are gonna drop another 5-10% to roughly 18-20% below their early 2022 peak.

[The-Shoveler]

Uncertain times to be sure.

IMO TPTB can’t seem to make up their minds, do they want to reduce inflation or increase it?

Now they want $22 hour min wage for fast food (45K/year for high school kids LOL not bad money to start).

Not sure maybe part of some plan I can’t figure it out or maybe TPTB can’t seem to stick to a theme LOL.

[phaster]

[quote=The-Shoveler]Uncertain times to be sure.

IMO TPTB can’t seem to make up their minds, do they want to reduce inflation or increase it?

Now they want $22 hour min wage for fast food (45K/year for high school kids LOL not bad money to start).

Not sure maybe part of some plan I can’t figure it out or maybe TPTB can’t seem to stick to a theme LOL.[/quote]

TPTB (i.e. politicians and their partisan supporters, lobbyist, etc.) are basically people (i.e. “idiots”) who just want their “fair share” of the economic pie

truth is, times are not all that uncertain,…simple fact of the matter is global organized society is going to face a harsh population contraction because DEMANDS > SUPPLY (andl this fact is something people do not want to acknowledge)

FYI on the natural resources side there was a study started back in the 1970s which forecast “the limits to growth” (so I’d argue the strategic “big picture” trends were actually looked AND pretty well understood decades ago)

https://en.wikipedia.org/wiki/The_Limits_to_Growth

as far as rising interests rates, this uptick also is somewhat expected if one looks to demographics,… again this isn’t anything new because understanding what happens to a society can be roughly forecast by the demographic distribution (AND this concept is something I picked up as an undergrad)

FWIW Peter Zeihan is a geo-political analyst and he looks at the world and gives thought provoking presentations looking at issues from a demographic distribution POV

https://www.youtube.com/watch?v=IGvsHqvtJfA

PS a $22 min wage proposed by woke politicians for essentially talentless workers shouldn’t be all that surprising given the idea they are spending other people money in order to try and buy political good will (i.e. “votes”),… what I’m trying to point out is politicians on both sides of the political spectrum spend government money in an effort to buy support from the public at large, for example TRUMP and his CARES ACT letter/checks

https://www.cbsnews.com/news/trump-stimulus-check-letter-130-million-americans/

[gzz]

The pizza place on Sports Arena Blvd had a sign they pay $22 an hour to start.

The immediate effect of this law is that fast food places will cut back on hours and add those order and pay yourself terminals.

Another change may be avoiding being fast food by having table delivery like Rubios.

There’s that fancy jack in the box in Hillcrest with the fireplace that was part of their failed “upscale jack” experiment. Taco Bell has a small number of “Taco Bell Cantina” with fancier interiors and sometimes beer.

Another change will be to have smaller menus to reduce labor costs from making less popular items. I get fast food only about twice a year now, and the menus seem to have fewer items than they used to, especially Taco Bell.

When I lived in Luxembourg, they had the highest minimum wage in the world, about $11.50 plus full health insurance, and 1.5 on all hours after 6pm, all of saturday, and 2x on Sunday. Most fast food was closed on Sunday as a result, and gas stations typically were closed on Sundays too rather than pay people $23 an hour in 2003, which I guess would be about $35/hr now.

Not being able to go shopping at any random time I liked was a small drag, but everyone got used to it.

[The-Shoveler]

Now All Restaurants are Taco Bell

[JPJones]

[quote=The-Shoveler]Now All Restaurants are Taco Bell

https://www.youtube.com/watch?v=xFiDoOgRTpk%5B/quote%5D

unintelligible grunting

[Pbranding]

Was just checking rates at mission federal. Jumbo 30 year fixed with excellent credit is 7%. No longer has a 10/1 Arm option too.

[sdrealtor]

Aimloan still around 6 but conventional but we’ve sure come so far so fast. Tougher by the day for buyers. Sellers digging in deeper and staying put locally

[barnaby33]

Sellers digging in deeper and staying put locally

Wake me when we get to capitulation!

[The-Shoveler]

LOL capitulation may look very different this time.

Will it be the fed, or the market

We will see I guess.

[sdrealtor]

[quote=barnaby33]

Sellers digging in deeper and staying put locally

Wake me when we get to capitulation![/quote]

I’ll give you a guy when that guy does. Unfortunately it will only be that guy. Sub 3% mortgages are the new status symbol and a lot of people have em

[an]

[quote=sdrealtor][quote=barnaby33]

Sellers digging in deeper and staying put locally

Wake me when we get to capitulation![/quote]

I’ll give you a guy when that guy does. Unfortunately it will only be that guy. Sub 3% mortgages are the new status symbol and a lot of people have em[/quote]
Dang, I can’t join that club.

[Author]

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