Home Prices Moving Up

Just out is the press release on housing…

New York, February 23, 2016 – S&P Dow Jones Indices today released the latest results for the S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices. Data released today for December 2015 show that home prices continued their rise across the country over the last 12 months. More than 27 years of history for these data series is available, and can be accessed in full by going to www.homeprice.spdji.com. Additional content on the housing market can also be found on S&P Dow Jones Indices’ housing blog: www.housingviews.com.  

Year-over-Year  The S&P/Case-Shiller U.S. National Home Price Index, covering all nine U.S. census divisions, recorded a slightly higher year-over-year gain with a 5.4% annual increase in December 2015 versus a 5.2% increase in November 2015. The 10-City Composite increased 5.1% in the year to December compared to 5.2% previously. The 20-City Composite’s year-over-year gain was 5.7%, the same as November.  

Portland, San Francisco and Denver continue to report the highest year over year gains among the 20 cities with another month of double digit annual price increases. Portland led the way with an 11.4% year-over-year price increase, followed by San Francisco with 10.3% and Denver with a 10.2% increase. Thirteen cities reported greater price increases in the year ending December 2015 versus the year ending November 2015. Phoenix had the longest streak of year-over-year increases, reporting a gain of 6.3% in December 2015, and the twelfth consecutive increase in annual price gains. Detroit posted a 7.1% year-over-year price, up from 6.3%, the largest annual increase this month. 

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We do note on this last chart that housing prices are back to where they were in 2005…And that’s the price only.  Doesn’t count commissions or the effects of inflation so draw your own conclusions.

Mine is it is still far better to be your own landlord than make someone else rich while you miss the benefits of home ownership…

If – as we have been hypothecating for a while – we see a major fifth wave up in the market, then we may see an astronomical housing recovery and zoom onto new highs if a fifth macro Elliott wave shows us.

We have experienced a lot of “price compression” in the market place, yet when I go out and buy building materials, the prices have not come down and if this is the case going forward, then the fifth wave in stocks could bring housing up to new all time levels as well.

Talk to your builders…they might see this too.  When house prices where whacked in many places by 50 percent in the 2008-2009 period, the materials prices can down a much more restrained 10-20 percent.

Where are all the doom prophets today?  LOL…(I crack myself up sometimes…)

Market Breather?

We are still expecting this to be a generally sideways kind of week in the market…. because now with Housing data in, the next psychological hurdle is the G20.

Overnight, Asia was down about half a percent and ditto things in Europe.

Futures in the US were up about 30 on the Dow after the Housing report.

Got a pet theory here:  There is nothing good about peace, at least insofar at the global economy is concerned, because it’s all turning into a massive mish-mash of too big to fails.  It used to be that it was banks.  But now, with yields very low for a long period of time, where will insurance companies come up with the gains they have wrongly anticipated in order to make good on annuities and such?

At what point would the insurance business have to start unloading prodigious amounts of real estate (mostly commercial) in order to help fund their annuity obligations?  And when it happens, will that turn into a huge drag on the economy?

Worse: Would the insurance clans begin to position themselves as too big to fail?  Could they make a case that “If you don’t bail us out, we will start dumping our stock and bond portfolios right and left and you – governments of the world – can’t handle that….”

After that – once the insurance folks figure out that they could follow in the “Too Big” footsteps crafted by the banksters and was A.I.G. a test run?  Could the defense industry then follow as well?  “Give us a moderate sized war because we will lay off umpteen zillion people if we can sell planes, missiles, tanks, and militaria…”

On to the high points of strong-armed complexity.  Groups spanning from the local Black Lives Matter to the Banksters at the top, the macro-trend is for every-increasing strong-arming of the public’s mindset and purse….

Speaking of BLM and Racism…

The headline this morning is a fine example of what I’m talking about – this notion that hypercomplexity eventually bubbles into uselessness:  “Black Lives Matter slams public library’s ban on blacks-only meetings as racist…”

Of course, I’m sure if the Klan was to pull off the same thing – wanting to use a public meeting place but then applying race as an entrance criteria, BLM (and Ure’s truly) would have a problem with that.  But with the shoe on the other foot, BLM is asking for special rules for them.

No…equality is the point:  Everyone wants equality and this how that stuff works.  Race is not a criteria in any direction.  Otherwise, it’s just a matter of “who owns the best racism plan this week.”

Hypercomplexity – and how we deal with it – is the most important issue out there.  Sadly, it is being widely trivialized.  I got a product announcement overnight about two new decks of playing cards that are in the works.  One features financial collapse while the other one is themed nuclear war.

Ha, ha….very funny until you’re dead.

The Daily Obama Bash

We don’t generally get into the herd/pile-on relative to the chief executive, but failure to actually secure the border or, to name another promise, shut down Gitmo, does tempt us from time to time.

Especially when we read headlines like “White House expected to meet Guantanamo plan deadline, but it won’t change much in Congress.”  If you have trouble with the math doesn’t this pencil out to 7-years of doing nothing and then producing only a plan? 

OK, too harsh?  Not as harsh as one of the presidential candidates puts it “Ben Carson: Obama was ‘raised white.’”

Ben Carson’s books are still worth reading regardless of which political party you’ve been suckered into, since both are owned by corporations and DC law firms from a real policy standpoint.

The U.S.Department of Self-Congratulations

Seems to have been founded by John Kerry as Kerry “Hails Deal With Russia for Syria Ceasefire.”

Write down where you read it first:  This will blow up and end badly.  There are just too many defense contractors and war-making is just too big a business for peace to be really affordable.

Europe Rediscovered “Borders”

And with Greece holding the bag as the main thoroughfare into the former European Union, quickly becoming EUrabia, the headline that Greece Blasts Austria as More Migrants Stranded is not surprise whatsoever.

Europe is waking up to the idea that there are too many people for massive free lunch programs. 

If you’re waiting for numbskulls in Washington to figure this out, too, don’t hold your breath.  They are playing for personal profit and re-election and if they actually solved anything they would have to move on to other problems.

And change, my friend, is never welcome anywhere.

Global Subsidence?

Got another interesting story going bout how sea level is rising faster than anyone expected.

It isn’t just the article over at the AAAS site (Sea levels are rising at their fastest rate in 2000 years) that have our attention.  It’s also that the story (Seas are now rising faster than they have in 2,800 years, scientists say) is getting traction in the Washington Post.

A couple of “reality checks” here:

First, I have yet to see the meaningful study of global thermodynamics.  Let me explain:  We have a couple of huge areas called polar caps.  But think of them as ice cubes.  Since the last Ice age, they have been cool.  But now a lot of the ice is coming up on the cross-over temp where the state-change to water takes place.

Since output from the sun drives a lot of things, seems pretty logical that any time you’re not descending into an Ice Age you can call the period you’re in “global warming” and do so with a lawyer-like straight face.

But the other missing piece of the puzzle is how much of the sea level rise is caused by land mass erosion?

Again, simple math problem – but we know, just to use an example (from Wikipedia) “The prehistoric and historic delta lobes of the Mississippi River Delta have influenced the formation of the Louisiana coastline and led to the creation of over 4 million acres of coastal wetlands”

I may not be the brightest bulb in the ham sandwich (or whatever the old saying is) but seems to me that if one river system alone creates 4-million acres of new land, then perhaps the remaining water out at sea will be displace and rise.

This is not to mention the thermal expansion of water problem…

Good news?  All of this is nothing that a quick nuclear war won’t fix.  Of course, salinity levels would go up and 6-billion plus would die..but hey!  Can’t make an omelet without breaking a few, now, can we?