China’s Evergrande now entering bankruptcy which may force the sale of millions of homes and condos as well as total losses for international investors in China real estate related bonds. Both the Suez and Panama Canals seriously limited ship traffic but for different reasons. Inflation again increasing and the impact on interest rates will not be good for consumers or investors (in the stock or bond markets). So far, the BRIC’s countries want to out compete the U.S. but they prefer investing th...
Jan 31, 2024•20 min
Many revision to 2023 government reported indices understated the country’s economic health (employment seriously overstated and inflation understated). The commercial real estate market continues to collapse with the equivalent of 30 Empire State Building now vacant in NYC. The wars and threats of wars are driving up future inflation via escalating shipping fuel, crew costs, and sky high shipping insurance costs. China’s recessionary environment keep crude oil prices stable globally but that’s ...
Jan 19, 2024•20 min
As stock and bond markets celebrate a friendlier sounding Federal Reserve it’s time to review the context. The quick change in tone of the Fed and the crashing commercial real estate markets are likely related. We enter 2024 with many Black Swan events threatening our well-being. Our focus on lessening personal financial risks in stock and bond provides a calmer backdrop for the holiday season knowing that our many 2023 economic issues are carrying over to 2024. The $Trillions injected into the ...
Dec 21, 2023•14 min
3rd Quarter company sales and earnings were most disappointing! Once again, a small number of large companies counter-weighted the poor performance of the majority of companies and industries. Now the large companies, such as Apple, are facing lower sales prospects and can be expected to have magnified downside leverage on the stock market in a growing recessionary economy. A number of important leading indicators are warning of a difficult 2024.
Dec 05, 2023•16 min
A national commercial real estate crisis is picking up momentum with many landlords and banks facing historical financial losses. WeWork’s bankruptcy and Blackstone’s project by project defaults are adding hundreds of large commercial properties and many millions of square feet of office space to an already in-process crisis. Long term interest rates are expected to continue even higher as U.S. government long term bond auctions now reflect many traditionally large buyers walking away (and actua...
Nov 15, 2023•12 min
Interest rates and inflation continue as major issues for economic growth and family well-being. BRICS countries cutting back needed raw materials and threatening our EV industry. Nuclear power and cancelled pipeline plans coming back on the table. Preparing for a long-term war related economy?
Nov 01, 2023•18 min
This week we discuss anticipated Fall-out from a new extended period of high interest rates, out of control government borrowing, and challenges to the U.S. dollar.
Oct 18, 2023•16 min
The CARES Act has moved over $20 billion/month into the hands of business owners. These amounts are nationally significant and have kept many reported government indices out of recessionary mode. This year the monthly cash payments from the IRS to businesses began to ramp up from $20 billion to $40 billion/month which is over half of all corporate income taxes normally received. Due to rampant fraud in this program over 600,000 new applications are now held in suspense with no IRS processing all...
Oct 05, 2023•22 min
Why it takes a while for a crisis to manifest itself…fair warning! Commercial real estate is rapidly transitioning from a core lending component to a core financial solvency issue. Bad debts for both commercial real estate, small business, and consumers moving through the pipeline will negatively impact the financial markets in a big way.
Sep 20, 2023•13 min
Welcome to our 100th episode! We’d like to thank our loyal listeners for making it to #100 with us! This episode will provide a summary of today’s leading economic issues with expectation of real estate, banking, and refinancing crises this year and next. Energy and therefore, inflation, is rapidly surfacing and continues to lead the U.S. into a “Round 2” of the 2007-2009 Great Recession in terms of impact due to “high interest rates for too long”. Special attention is given to China’s growing a...
Sep 07, 2023•23 min
Two important meetings for the U.S. economy, inflations, interest rates, and global dollar valuation. Expect interest rates to continue higher this year and next as the U.S. Treasury sells record volumes of debt with few international buyers. Also, expect another banking crisis to rear its ugly head soon based on the commercial real estate needs to finance with downward trending collateral values. Keep an eye on the results of the BRIC’s Annual Meeting taking place in South Africa this week for ...
Aug 23, 2023•15 min
Out of control spending has deferred a major recession but time is running out. Interest rates due to banking sector stresses will remain high this year and next given the federal government’s need to refinance almost $15 Trillion of debt this year and next. Begin thinking about the natural resources and energy sectors as attractive investment opportunities for a recovery starting in 2024. Please refer to these links to simulate your plans for next year: https://www.etftrends.com/2016/05/23-best...
Aug 09, 2023•14 min
Higher interest rates coming as the U.S. sells $Trillions into the global bond market each month. Inflation moves in waves with the next wave starting soon this year. Raw materials will be important investment opportunities as the West rebuilds manufacturing, moves aggressively to EV autos/trucks, and oil prices resume a uptrend. Please access this link to begin consideration of raw materials company investments: https://www.etftrends.com/2016/05/23-best-etfs-to-track-basic-materials/
Jul 26, 2023•26 min
The next phase of higher interest rates is starting and it’s a combination of the Federal Reserve selling many $billions of its bond portfolio plus the U.S. government ramping up its sales of new debt securities. Both short- and long-term interest rates can be expected to increase another one or more percent by year-end choking off business borrowing and creating more bank crises. Bad news aside it may be time to start planning for a recovery starting in 2025 or, possibly, later.
Jul 14, 2023•18 min
Higher for longer interest rates will soon take a bite out of stock, bond, and real estate prices and with Russian instability, that’s just the icing on the cake! Many economic/financial indicators signaling we are unsustainably high levels in the stock, bond, and real estate markets. Global movements out of dollars continuing which threatens many upcoming U.S. government auctions of new and refinanced debt. It appears more and more likely that interest rates will move higher and create a deeper...
Jun 29, 2023•24 min
Global oil prices are ready to ramp up. Imports/Exports (non-energy) is stagnating. Commercial real estate is on track toward another financial crisis. Inflation is still a major threat in Europe, and, likely, the U.S. Interest rates remain in uptrends with $1 Trillion of U.S. Treasury borrowings coming up in an environment of few debt buyers. For a brief but important interview with Danielle DiMartino Booth visit: https://tdameritradenetwork.com/video/accelerating-economic-slowdown For the webs...
Jun 14, 2023•18 min
Economic fundamentals continue to deteriorate while tech stocks find a new shiny object in AI. Congress re-commits to more deficit-spending while the Fed will have to buy an increasing amount of U.S. debt as interest rates move higher. The 30-year fixed mortgage is now above 7% further depressing home prices in many markets. Commercial office building prices in “free-fall” as almost $1 Trillion of related mortgages need to be refinanced in the next 1 to 1 ½ years. Inflation stuck at far higher l...
Jun 01, 2023•23 min
This week we take a look at examples across the U.S. of the deepening commercial real estate depression, inflation morphing into a long-term issue despite Fed efforts, and lower corporate earnings and lower P/E ratios ahead reflecting the long anticipated recession.
May 17, 2023•17 min
In 2008-2009 the U.S. and global economy was on life support due to failures in the home mortgage markets. Now, in 2023, the stage is set for what could be another U.S. and global financial crisis. This time the crisis is coming from the commercial real estate market and will likely expand to impair another 200 or more medium-sized banks and savings and loans. We also feature Emmanuel Probst as an additional example of the breadth and depth of UCLA Extension educational offerings (brand developm...
May 03, 2023•27 min
Part two of this two-part series. Since the beginning of 2023 the majority of the world’s population and countries (China, Russia, India, Saudi Arabia) are collaborating to create a new reserve currency. The impact of another reserve currency could be quite serious for the U.S. government in selling its Treasury Notes/Bonds as well as creating new shortages as well as new long-term inflation. Bottom line: if successful, we’ll no longer to be able to take debt refinancing or wealth accumulation f...
Apr 20, 2023•23 min
Part one of a two-part series: This year is the first year of an actual decline in the S&P Index ‘top 10’ in terms of both revenues and free cash flows. Lower price/earning ratios as a function of both low/no growth and high interest rates will drive both stock and bond prices lower this year. Stay tuned for part two where we cover U.S. government spending and dollar substitution in global trade.
Apr 06, 2023•17 min
The Fed is only at the starting line in mitigating bank insolvency issues. Their additional money creation ( or “lending” ), new buying of government securities ( instead of selling them), making up for China’s sale of U.S. government securities, and making little or no progress on systemic inflation will pretty much guarantee a long Stagflation, if not severe recession, for the U.S.
Mar 22, 2023•21 min
January-February bounce in the stock and bond markets ending with inflation gaining more traction globally. Natural resources needs are escalating due in part to EV car and battery plant expansions but global oil and metals inventories are at multi-decade lows. Get ready for a take-off in oil and metals prices which will bring forth a new, possibly, violent uptrend in global inflation. Higher and longer interest rates are choking new investments in tandem with lower demand for future manufacture...
Mar 08, 2023•19 min
Prior long-term periods of increasing interest rates by themselves have dropped stock prices as P/E ratios have declined. Present value analysis argues that high long term interest rates as we’ve been experiencing drives down the present value of long-term corporate earnings which, in turn, drops the P/E ratios across the stock market. Several periods are referred to in this podcast have witnessed P/E drops of approximately 50% during decades of interest rate increases. If the lower P/E is coupl...
Feb 09, 2023•17 min
Credit card debt is at a new all-time high while personal and business bankruptcies are ramping up. With high inflation since last year consumer purchases mainly on the credit card as savings balances return to all-time lows. Meanwhile, the Federal Reserve with “only $42 billion of capital” is set to lose approximately $240 billion this year and next. These losses which have already started with have impact on Congressional regulation of the Fed and a significant potential impact on confidence i...
Jan 26, 2023•15 min
Many parts of the U.S. economy are crashing with inflation down but not heading to the 2% Fed target area. The U.S. government must sell approximately $6 Trillion (20% of all federal debt) of new and refinanced debt this calendar year but who will buy it? The Fed is facing the possibility of a depression or a return to higher inflation with the fall-out of either creating significant impacts on our lifestyles.
Jan 11, 2023•16 min
With a growing global influence of China, Russia, India, and Iran vs. the West, we close out the year considering the future role and power of the Shanghai Cooperation Organization in economic and military contexts. Energy prices and U.S. unemployment issues will return as significant “impactors” on the real estate, stock, and bond markets. Happy Holidays, everyone and we’ll be back next in January!
Dec 14, 2022•16 min
This week we discuss Russia building their own oil tanker fleet to bypass Western sanctions (the war in Ukraine continuing with additional “worst case” risks), U.S. unemployment becoming the key topic for 2023, and inflation remaining a multiple of Fed target but ‘easing’ in the cards to avoid a major recession.
Dec 07, 2022•21 min
Central themes supported with substantial data references continues: crypto currencies are not investments (since our initial Podcasts two years ago), a severe global recession is gathering momentum, and debt is swamping our economies. Unemployment is an emerging issue promising to hit 2023 in a major way starting with tens of thousands of recent layoff’s in hi-tech, spreading to our construction industries, and soon threatening substantially more retail and services jobs. Please be mindful to r...
Nov 23, 2022•22 min
Europe’s recession is all but locked due to upcoming energy shortages with much higher prices and another housing bubble already pricked. High inflation and interest rates in the U.S. with a downward trending global economy is likely to bring recession as a base case for next year. High interest rates, lower housing prices, and increasing energy prices will, in early 2023, cause the Fed to belatedly pause…although it may be too late to pause to avoid a severe recession.
Nov 10, 2022•17 min
