Vital Statistics:
| Last | Change | |
| S&P futures | 2957.5 | 24.1 |
| Oil (WTI) | 55.54 | 1.78 |
| 10 year government bond yield | 2.01% | |
| 30 year fixed rate mortgage | 4.10% |
Stocks are higher this morning as interest rates fall globally. Bonds and MBS are up.
The Fed maintained interest rates at current levels, but signaled the willingness to cut rates if necessary:
“The Committee continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2 percent objective as the most likely outcomes, but uncertainties about this outlook have increased. In light of these uncertainties and muted inflation pressures, the Committee will closely monitor the implications of incoming information for the economic outlook and will act as appropriate to sustain the expansion, with a strong labor market and inflation near its symmetric 2 percent objective.”
The dot plot showed a 30 basis point decline in the fed funds expectations. You can see the plots side by side below. The central tendency for 2019 fell by 32 basis points to 2.17%
FWIW, the Fed upped their forecast for GDP, and cut their forecast for unemployment and inflation. Why that would be consistent with a potential rate cut is beyond me, but such is life in our era of Calvinball monetary policy. The decision was nearly unanimous, with only Bullard dissenting, preferring to see a 25 basis point cut. The Fed funds futures are pricing in 100% chance of a rate cut at the July meeting.
Bonds rallied on the announcement, although mortgage backed securities were slow to follow. We did see some reprices for the better late in the day, but nothing too dramatic. Expect mortgage rates to lag the move in bonds, as usual.
Initial Jobless Claims fell from 220,000 to 216,000 last week.
Home prices rose 3.6% YOY, the strongest acceleration in 7 months, according to Redfin. Interestingly, the only areas that dropped were the markets that rallied the most over the past few years: San Jose, New York, Los Angeles, where inventory is up smartly. Where was the fastest growth? Knoxville TN at 15%, Milwaukee WI at 15% and Camden NJ at 11%.
Judy Shelton is the latest potential nominee to the Fed. She is an advocate for much lower interest rates. She also favors ending the Fed’s policy of paying interest on excess reserves, which encourages banks to park money at the Fed versus lending it out.
Fannie and Fred are trying to do more to increase lending for manufactured homes.
Filed under: Economy, Morning Report |
All Things in Moderation 
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Lulz.
https://www.politico.com/story/2019/06/20/clyburn-hoyer-pelosi-diversity-hiring-1372606
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This trial is wild.
https://www.apnews.com/0dfd8c7df7bb485786996d09e0ab7595
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For Scott,
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More for Scott,
https://reason.com/2019/06/21/clarence-thomas-benchslaps-the-federal-government-in-a-property-rights-case/
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And more,
https://www.redstate.com/streiff/2019/06/22/scotus-blew-stare-decisis-nearly-declared-federal-government-unconstitutional/
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Indeed, if SORNA’s delegation is unconstitutional, then most of Government is unconstitutional…
And it is! Perhaps there is hope.
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If Knick v. Township of Scott “makes some regulatory programs ‘unworkable in practice,'” Thomas declared, “so be it—our role is to enforce the Takings Clause as written.”
Thomas could be the greatest Justice to ever sit on the Court. Seriously.
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Thomas’s opinion in the Bladensburg cross case is yet another example of his seemingly singular clear-headed focus on and dedication to the actual meaning of the words of the Constitution.
Click to access SCOTUS-Opinion-in-American-Legion-v.-American-Humanist-Association.pdf
To do him justice I would have to quote the whole opinion, but basically he argues that:
1) The very words of the Establishment Clause (“Congress shall make no law…”) resist the “casual” and “inattentive” incorporation of it that the Court has accepted.
2) Having incorporated the EC, the Court has defeated the very purpose of it, imposing federal jurisdiction where it had actually been prohibited.
3) Even accepting incorporation, the EC prohibits “laws”, not displays. Displaying a cross involves no coercion at all.
4) Displaying a religious symbol on government property is not “establishing” a religion as the term was used by the either the ratifiers of the Constitution or the 14th amendment. Indeed, both of them routinely did exactly that.
Thomas is far and away our greatest living Justice, and possibly the greatest ever to have lived.
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Indeed he is. Definitely my favorite. And no wonder the left hates him.
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kosKidz are confused and angry over called-off Iran attack.
https://m.dailykos.com/stories/1866290
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putin told him to back down. it’s the only possible answer.
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^^^ This!!
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I don’t think anyone has mentioned it here yet, but this could be the greatest story of the year so far.
https://www.wsj.com/articles/ohio-bakery-awarded-44-million-in-libel-case-against-oberlin-college-11560528172
An Ohio bakery that sued Oberlin College for libel over accusations of racism has been awarded a total of $44 million in damages.
The family behind Gibson’s Bakery sued the liberal arts institution and a school administrator after the Oberlin bakery was the focus of protests following the arrest of three black students involved in a November 2016 shoplifting incident. The three students later pleaded guilty to misdemeanor charges.
A Lorain County jury on Thursday awarded Gibson’s Bakery $33.2 million in punitive damages. Last week, that same jury awarded the bakery, which was founded in Oberlin in 1905, $11 million in compensatory damages.
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Good read from Popehat:
Apparently the “toothbrush & soap” litigation started during the Obama administration:
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Elizabeth Warren has lost it.
https://www.redstate.com/bonchie/2019/06/23/elizabeth-warren-makes-case-gay-reparations/
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It’s the problem with living in such a tiny, isolated bubble. I have no doubt she structured her life much like the CFPB. Nobody in it but diehard leftists and ultra-progressives.
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she did
https://www.nationalreview.com/2016/12/consumer-financial-protection-bureau-tragic-failures/
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Which is sad. Something like the CFPB could actually have been a good thing if run from the start like Mick Mulvaney was tackling it. But the thing formed was not anything actually designed to protect or help consumers.
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