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Let the mutherfuker burn!
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Kevin S. Willis
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yellojktVital Statistics:
| Last | Change | |
| S&P futures | 3,794 | 14.50 |
| Oil (WTI) | 92.59 | 0.02 |
| 10 year government bond yield | 4.17% | |
| 30 year fixed rate mortgage | 7.14% |
Stocks are higher this morning despite some disappointing news from some tech leaders like Meta and Apple. Bonds and MBS are down small.
The upcoming week will be dominated by the CPI print on Thursday. The Street is looking for a 0.7% MOM / 8% YOY on the headline number and 0.5% MOM / 6.6% on the CPI ex-food and energy. We will also get some Fed speak.
Midterm elections are on Tuesday, however I don’t see them as a market-moving event. Right now the story is all about the Fed.
Banks will be closed on Friday for the Veterans Day holiday.
Home prices fell 0.52% in September, according to Black Knight. This is of course pushing down home equity, which will probably have a negative effect on consumption going forward.
Underwater homes are a risk for those who bought at the top of the pandemic-driven peak (late 21 / early 22). That said, the number of underwater / under-equity properties is well below pre-pandemic levels. Black Knight estimates that roughly 3.6% of the 53MM mortgages outstanding in the US have 10% equity or less. Overall equity is still about $5 trillion above pre-pandemic levels, which works out to an average gain of $92,000 over that period.
With rising rates, the median monthly payment on a mortgage has risen $558, or about 40% since the beginning of the year. The MBA’s mortgage payment to rent ratio has been on a tear since rates began rising.
If you look at this chart, the natural conclusion would be that the first time homebuyer should rent because that is a better deal. Here is why that isn’t the case. Rents tend to lag home prices by about 21 months. Landlords reset the rent for an apartment upon renewal, however the big chunks happen when the tenant moves and the apartment gets set to market rents. So if home prices rise for a year, rent stays the same until the lease expires. Time lags explain this chart.
Note that for a first time homebuyer, the monthly payment on a fixed rate mortgage will stay the same for the term of the loan. Plus the first time homebuyer can deduct taxes. While this chart seems to imply that renting is more economical than buying, I personally think that is penny wise and pound foolish.
Filed under: Economy |
All Things in Moderation 
Reading these two pieces back to back is illuminating:
https://www.washingtonpost.com/opinions/2022/11/07/partisan-politics-age-gerrymandering/
vs.
Mark, I’d be interested in your take on Texas politics this year. Do you think either the NY Times or the Washington Post gets it right?
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I think this tends to be indicative of how out of power a given political party thinks it is, and how much the party apparatus thinks it’s addressable and relevant. The GOP clearly sees it addressable and relevant in a lot of areas, where as the left dominates the culture and the bubbles so much of the party apparatus exists in, so they don’t see much of it as relevant. There are organizations that have done stuff like install super-progressive DAs by moving in and capturing the local races but I expect that was pure activism and the party itself was probably unaware it was happening.
But to some extent I think it has to be the Twitter-media-progressive-celebrity bubble. They live in an environment where everything is assumed to be a given, and high-visibility celebrity the only thing they might be interested in fighting for. So they want the presidency, plum governorships, etc–and will fight there. But there’s no reason to fight for judges or dog catchers or sheriffs (from the party apparatus point of view; like I said, there are independent activists groups that may do that). But the national and local party folks just expect that all to happen through osmosis.
Some of the Demographics is Destiny argument might explain their lassitude as well. It’s already accepted that Democrats with naturally matriculate into power, everywhere, so why waste energy playing the long game?
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The TX Dem party is pretty woke and VERY focused on Urban, big city issues. There is not the hispanic influence you’d think given the population demographics. San Antonio is the exception to that but it’s an island and has always been. Austin white Liberals have the financing so Woke is the messaging and Houston and DFW have the voters.
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I also gotta think the California is the photo negative of Texas re party apparatus.
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People are getting sick of ESG. Finally
https://www.euromoney.com/cop27/article/2atqm25qca2tevbrfxh4w/investment/the-anti-esg-funds-exploiting-the-us-political-divide?utm_medium=email%20marketing&utm_source=marketo&utm_campaign=emmag_cop27_2022-11-08&utm_content=textlink&utm_term=newsletter2-article1-antiesg&mkt_tok=Mzc2LUtWVi0xNzcAAAGH8fVl8OOw19VfcutJ7fX5DKTD4_yuLDDzTsUpBkDIi0h6HsLh_8FpCnv1eRjn8yjNoAgTf4C-GDhITbhUS89XWDOl4kxu4GVb0I4afhyvuxzifQ
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They didn’t think anybody was going to notice. Or care what their money was invested in. Ooops.
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I figured ESG would crash and burn in a bear market.
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Nice turn of phrase: “little clique bullies”
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They are Judge Smails protecting Bushwood from Al Czervik.
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I get the hypocrisy angle but I say investigate away.
https://redstate.com/bonchie/2022/11/07/politico-suggests-election-fraud-could-cost-democrats-the-election-n655664
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Not sure how effective this will be:
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They hate Kristol, they just think it’s an effective cudgel against the right. I’ve yet to see where but YMMV.
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Oh sweet Jesus! This is a very special Tweet.
They literally have no understanding outside their bubble.
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McWing:
Oh sweet Jesus! This is a very special Tweet.
Occasionally, often out of frustration, they inadvertently reveal their true selves. Reminds me of McAuliffe and his “I don’t think parents should be telling schools what they should teach” moment.
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Cause that 31-year old childless expert with a degree in gender studies from Vassar knows more about your kid than you do.
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and even after Youngkin was elected, it’s still ongoing:
https://www.cbs19news.com/story/47254660/meriwether-lewis-elementary-is-next-school-to-have-name-reviewed
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They really can’t read the room.
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Occasionally, often out of frustration, they inadvertently reveal their true selves.
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I definitely thought that was a “said the quiet part out loud” moment. I’m not sure saying “you’re stupid so I’m about to trick you” is a good way of winning voters.
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They really don’t. Twitter has done the left no favors–and they continue to think it was the best thing ever invented.
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The new line coming out of the Stacy Abrams camp is that black men aren’t supporting her because they have been the specific targeted by the right with “disinformation”. That can only mean one thing…the Dems have in fact been targeting black men with disinformation.
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I think the gender divide between the parties is going to grow to a chasm.
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Haven’t Dems been targeting everybody with misinformation? 😉
But the implication is “black men are easily manipulated because they just aren’t as smart as black women and white liberals”, which seems kind of racist and also a little sexist.
But the long term goal is to sell the message that Republicans campaigning is voter suppression and election theft, while ballot harvesting and ballot stuffing and helping the dead to vote is capital D Democracy.
And also obviously Democrats campaigning is totally cool. Just when Republicans campaign, it might suppress Democrat votes, so is a form of election-stealing. So unless you want to lose your Democracy you must always vote for Democrats and never vote for Republicans.
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Goddamn, we could learn a thing or two from those Ruskies.
https://www.reuters.com/world/us/russias-prigozhin-admits-interfering-us-elections-2022-11-07/
Apparently they control All Things!
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It apparently never occurred to the AP that his very “admission” was an attempt to “influence” the election. These media people are either stupid or diabolical.
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Too stupid to be diabolical.
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Oh the humanity!!
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I actually think Musk is mismanaging this. He should have delayed most of the new initiatives until after the election and announced them clearly and in the case of the suspensions given out a warning ahead of time that the rules were changing.
He’s making it easy for his critics.
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I think he’s definitely mismanaging. From a “make this work and make money” aspects.
If you look at it like he bought himself a $44b toy for Christmas then it all makes more sense, IMO.
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It’s my understanding he hasn’t changed anything other than charging $8 for verification and actually enforcing their TOS (which predates Musk). I suspect that blue check Twitter would blame Musk for their possible election loss regardless.
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He (or the people doing this at Twitter) are making it look like he’s selectively and aggressively enforcing TOS around himself, specifically. Other users are coming up with example of child predators and people impersonating other people or groups (I think one was a charity) that have not been suspended. And so on. Which is just Twitter acting like Twitter has always acted, just now on Musk’s behalf rather than a handful of power lefties so it is pissing them off.
The numbers seem to say–and I believe–engagement on the platform and new accounts have exploded since Musk officially took ownership. And the awful bubble people that have long dominated Twitter are still there, still kvetching and making bizarre and unhinged complaints in a kind of ongoing QAnon-vs-BlueAnon smackdown.
Twitter continues to reveal–IMO–that social media is a cancer, and humanity is awful. But now I’m more interested in Twitter-as-happening thanks to Musk, so I’m spending a lot more time on it, probably more in the last week than in the previous 10 years combined.
Although I will say, if Twitter is any thing to judge by, most people on the left and right are uninformed, certain, proud nincompoops. And everyone who disagrees with them are Nazis to some degree or another. Definitely makes me think the left has no license to complain about “nuance” or “shades of gray”–they are easily as absolutist, morally certain, and convicted of absurd, fact-free thing as any Bible-thumping moral-majoritarian asserting Democrats are consorting with Satan.
I also note that “the right” is culturally doomed, if the Twitter-right is anything to go by. They have no concept of how to win. Musk has it, clearly (ignore all critics; appropriate the tools of your enemies; assimilate). But when a lefty Twitter guy acts as Musk’s mouthpiece and starts “moderating” Musks whim-as-policy standards, all the lefties demand he quit because he’s too good to work for Musk, and all the right-wingers are like “go, you’re an evil communist”. Winning the culture war requires a willingness and ability to appropriate the Bagdad Bobs of your opposition. While avoiding them turning the tables on you, always tricky.
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I don’t think he cares what the left thinks.
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True, but he does have outside investors involved as well. He ought to care what they think.
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sure, but the single best thing to do is increase profitability, and cutting half the workforce goes a long way towards that.
I don’t think investors are too concerned over Kathy Griffin or whatever her name is.
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I think that’s also probably a temporary thing. He doesn’t want people pretending to be him to be tweeting a bunch of garbage out there and I get that. The long-term solution would be to enforce clarity on the accounts that they cannot alter–such as a display of their original name with an alert “This account is not using the name it was originally registered as”, requiring an approval process to change your name or otherwise letting people play around without being able to name themselves Elon Musk and go on a tear. And even if he only keeps a portion of the engagement and new accounts, there will be a interest in advertising just because of the eyeballs. If not the big fish then lots of little fish.
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No, but the drama is turning off advertisers.
He could made the exact same changes in a more organized manner without making it all about himself.
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I’m pretty sure he didn’t sink $44b in Twitter to NOT make it about himself. Once you could literally buy any material good you ever wanted, I suspect it’s actually harder to have fun. A trip to Disney World ain’t gonna do it. Having Twitter as your own personal plaything apparently scratches that itch for him.
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Everything has to be such drama.
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Very funny, especially the headline: Austin Has Been Invaded By Texas
https://nymag.com/intelligencer/2022/11/the-people-fleeing-austin-because-texas-is-too-conservative.html
To hear Stettin tell it, that is precisely why he is moving out of what Rick Perry once described as the “blueberry in the tomato soup,” a predominantly Democratic city full of liberal expats like himself seeking progressive politics and an urban lifestyle at a red-state cost-of-living discount.
…at a red-state cost of living discount. Said unironically/uncritically. These people have no self awareness.
The great sorting continues!
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They really lack awareness of what they are saying: which is broad Republican governance creates a lower cost of living, often significantly so. And generally better urban and suburban environments. So better quality of life. But got to get away from those terrible red states!
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Election Predictions-
Here’s mine for some high profile races. Fetterman wins in a drawn out squeaker – Oz just cannot overcome the shenanigans in Phillie. R’s Keep WI and NC and OH. R’s pick up NV as well as GA after a runoff. AZ remains D. So, I think that gets R’s to 51 Senate seats.
Lake and Zeldin win in AZ and NY respectively.
House Majority will be R 230 and D 205.
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