Morning Report: The Fed sees one rate cut this year

Posted on June 13, 2024 by Brent Nyitray

Vital Statistics:

Stocks are higher as markets digest the Fed decision. Bonds and MBS are down small.

As expected, the Fed maintained the Fed Funds rate at current levels. “Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have remained strong, and the unemployment rate has remained low. Inflation has eased over the past year but remains elevated. In recent months, there has been modest further progress toward the Committee’s 2 percent inflation objective.” In the May statement, the Fed said that “In recent months, there has been a lack of further progress toward the Committee’s 2 percent inflation objective.” So there is a bit of an improvement in the language.

The dot plot showed the Committee expects to cut rates once this year. The economic forecasts didn’t move much, however they did bump up their inflation forecasts a tad, with the headline PCE forecast increasing from 2.4% to 2.6% and the core rate increasing from 2.6% to 2.8%.

We have another benign inflation report, with the producer price index actually falling 0.2% on a month-over-month basis and 2.2% on a year-over-year basis. About 60% of the decline was due to falling gas prices. Ex-food and energy, the index was flat and rose 2.3% on a YOY basis. Both numbers were below expectations.

More evidence of a weakening job market: Initial Jobless Claims rose to 242k last week. This is the highest level since August of last year.

The median home sale price in the US hit a record last week, according to Redfin. The median sale price hit $394,000 which is up 4.4% on a year-over-year basis. Asking prices appear to be leveling off however. The median mortgage payment fell to $2,829 due to falling mortgage rates. “The latest inflation report is good for homebuyers because it has already sent mortgage rates down, though this week’s Fed meeting will temper mortgage-rate declines,” said Chen Zhao, Redfin’s economic research lead. “But on the other side of the coin, if lower mortgage rates bring back more demand than supply, that could erase the possibility that home-price growth softens, and push prices up even further. Lower rates and higher prices may ultimately cancel each other out when it comes to homebuyers’ monthly paym

Filed under: Economy |

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44 Responses

  2. jnc4p's avatar
    jnc4p, on June 13, 2024 at 12:57 pm said:

    Yep:

    My Liberal Patriot partner-in-crime, John Halpin, scrutinized the Biden campaign website in search of his second-term agenda, should he manage to vanquish Trump again. He found:

    The official website of the Biden for President campaign is a complete mystery. It’s basically a half-hearted request for money with a promise to “Finish the Job.”

    Finish the job?? Does this make much sense when voters think the job you’ve been doing is so bad?

    https://www.liberalpatriot.com/p/democrats-should-swap-out-bidenomics

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  4. jnc4p's avatar
    jnc4p, on June 13, 2024 at 2:08 pm said:

    Worth a read:

    On Derek Chauvin, George Floyd, and Reasonable Doubt

    Coleman Hughes wrote a column in these pages that set off a flurry of criticism. Here, he sets the record straight.

    By Coleman Hughes

    June 13, 2024

    https://www.thefp.com/p/coleman-hughes-derek-chauvin-george-floyd

    Original piece

    https://www.thefp.com/p/what-really-happened-to-george-floyd

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  5. jnc4p's avatar
    jnc4p, on June 13, 2024 at 2:36 pm said:

    Another good read:

    Let me give you one story: In 2018, I was invited to an event hosted by the Business Roundtable, an organization of C.E.O.s. Many people there I like and admire; many people there who hate my guts ——

    Not back then.

    Not back then; everybody loved me back then. But I was seated next to the C.E.O. of one of the largest hotel chains in the world at dinner. He was almost a caricature of a business executive, complaining about how he was forced to pay his workers higher wages.

    He said: “The labor market is super tight. What Trump has done at the border has completely forced me to change the way that I interact with my employees.” And then he pivoted to me: “Well, you understand this as well as anybody. These people just need to get off their asses, come to work and do their job. And now, because we can’t hire immigrants, or as many immigrants, we’ve got to hire these people at higher wages.”

    The fact that this guy saw me as sympathetic to his problem, and not the problem of the workers, made me realize that I’m on a train that has its own momentum and I have to get off this train, or I’m going to wake up in 10 years and really hate everything that I’ve become. And so I decided to get off that train, and I felt like the only way that I could do that was, in some ways, alienating and offending people who liked my book.

    https://archive.ph/5tSAv

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  7. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on June 14, 2024 at 12:30 pm said:

    Pretty sure this is a Vulcan mind meld thing that Biden is doing.

    https://x.com/nypost/status/1801607994599248269?s=46&t=vSGsUlnc4rLxcUf7zfUiHg

    I don’t know if the Pope is now POTUS or POTUS is now Pope.

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  8. jnc4p's avatar
    jnc4p, on June 14, 2024 at 5:02 pm said:

    Inflation would have hit 18 percent in 2022 if the government had calculated it the way it did before 1983, including mortgage rates, they found.

    https://archive.ph/IfoDU#selection-4449.247-4449.393

    Yep.

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  10. jnc4p's avatar
    jnc4p, on June 17, 2024 at 10:26 am said:

    It’s funny watching the Washington Post staff try to take down their new management team.

    Incoming Post editor tied to self-described ‘thief’ who claimed role in his reporting

    Unpublished book drafts and other documents raise questions about Robert Winnett’s journalistic record just months before he is to assume a top newsroom role.

    By Isaac Stanley-Becker, Sarah Ellison, Greg Miller and Aaron C. Davis
    June 16, 2024 at 8:09 p.m. EDT

    https://www.washingtonpost.com/investigations/2024/06/16/washington-post-editor-robert-winnett/

    Washington Post Publisher and Incoming Editor Are Said to Have Used Stolen Records in Britain

    Years before becoming The Post’s publisher, Will Lewis assigned an article based on stolen phone records, a former reporter said.

    By Justin Scheck and Jo Becker

    Reporting from London
    June 15, 2024

    https://www.nytimes.com/2024/06/15/world/europe/will-lewis-records-uk-editor.html

    What exactly do they think is going to happen if they are successful in this?

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    • Brent Nyitray's avatar
      Brent Nyitray, on June 17, 2024 at 11:14 am said:

      They think if they show they can sink a corporate-installed leader then they will get to continue to use the outlet strictly as a propaganda outlet.

      Complete with navel gazing think pieces about why sports have become politically polarizing.

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      • jnc4p's avatar
        jnc4p, on June 17, 2024 at 11:40 am said:

        Yes but I think they are underestimating Bezos continued appetite to fund failure.

        I don’t think Bezos cares about the monetary loss so much as he cares about the fact that the readership is halved. Billionaire egos don’t like to be associated with that kind of decline into irrelevance.

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        • Brent Nyitray's avatar
          Brent Nyitray, on June 17, 2024 at 12:03 pm said:

          I am sure the government is holding something over Bezos’s head (like an antitrust investigation) in order to compel him to keep WaPo as a propaganda outlet.

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        • jnc4p's avatar
          jnc4p, on June 17, 2024 at 12:10 pm said:

          I don’t. I think it’s vanity project and about ego. Like his spaceflight project.

          Bezos is the one who insisted on putting “Democracy Dies in Darkness” on the masthead.

          He loves this sort of flattery:

          Back in October, Post reporter Siobhán O’Grady made a point of thanking Bezos for his support at the ceremony he hosted for the International Women’s Media Foundation.

          It was the story she and colleague Anastacia Galouchka told — about crouching behind a Ukrainian tank, certain they were about to die in a Russian artillery strike — that had so moved The Post’s owner.

          She noted that he had done so much to help keep her and the other correspondents in Ukraine safe: They now had a proper bureau, an armored car and staff security advisers.

          “I hope your support continues forever,” O’Grady recalled telling him.

          “I should be the one thanking you,” he replied.

          https://www.washingtonpost.com/style/media/2024/06/10/washington-post-jeff-bezos-william-lewis/

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  11. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on June 17, 2024 at 11:50 am said:

    It is impossible not to read this thread and laugh.

    https://x.com/juddlegum/status/1802676311762035027?s=46&t=vSGsUlnc4rLxcUf7zfUiHg

    First off, the tweets devoted to Biden “pooping” are funny, in and of itself. Second, he’s amplifying things a la Streisand Effect. Third, methinks he doth protest to much. Finally, the left’s unremitting faith in the power of the right wing press is a thing to behold. Hell, the left’s faith in the power of the media to communicate anything is amazing.

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  12. jnc4p's avatar
    jnc4p, on June 17, 2024 at 12:26 pm said:

    Interesting what’s considered a state secret these days:

    Now, a judge in Tennesse may violate the Supreme Court’s famous Pentagon Papers ruling and order a reporter in Nashville named Michael Patrick Leahy to reveal the source of documents leaked to him. The leaked documents in question came from a trans-identified woman named Audrey Hale, who killed six people at a Christian school last year.

    Today, June 17, Leahy, the editor of The Tennessee Star, will appear in court for what is known as a “show cause hearing.” The judge will consider his arguments for why Leahy should not be held in contempt of court for having published excerpts from Hale’s writings.

    https://public.substack.com/p/michael-patrick-leahy-a-judge-doesnt

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    • Brent Nyitray's avatar
      Brent Nyitray, on June 17, 2024 at 12:55 pm said:

      Apparently it is a hate crime to put a skid mark on a Pride mural in the street, but not a hate crime to shoot up a Christian school

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      • markinaustin's avatar
        markinaustin, on June 20, 2024 at 6:28 am said:

        Brent, I think you may have a take on this that would make sense to me. The USN plans to replace all ten Nimitz class carriers with the new Gerald R. Ford class. But it looks to me as if the Fords have similar hull and flight deck specs and the differences are refined nuke engines and truly cutting edge computerization, that is supposed to cut crew from 5000 to 3000 to operate.

        I don’t understand why retrofitting one Nimitz class at a time wouldn’t be more cost effective than replacing them with new carriers that seem to have such similar hull and flight deck specs. I could leap to the conclusion that Congresscritters are looking after Bath and Pascagoula but I really have no clue.

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        • Brent Nyitray's avatar
          Brent Nyitray, on June 20, 2024 at 9:20 am said:

          Mark, I really don’t know why not. Perhaps the old steel structures experience fatigue over their lives and that is why?

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        • markinaustin's avatar
          markinaustin, on June 20, 2024 at 9:54 am said:

          Best rational explanation, I guess. Thanks. I have asked another retired naval officer I know and if he has a take I will post it.

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        • markinaustin's avatar
          markinaustin, on June 20, 2024 at 10:05 am said:

          Hah! Jim answered me. He agrees with you. He thinks they will replace one at a time from the oldest, first. He wrote that they started retiring the Enterprise class at a time so that no carrier remaining would be 50 years old, and this is about the same timeline here for the oldest Nimitz. While he was speculating on the carrier’s actual lifespan for steel stressing he knew that subs actually had to be retired before the 30 year mark.

          He wrote that the newest Nimitz, the GHW Bush, is only about 15 years old, but the original Nimitz is already about 50. So one at a time replacement will allow for orderly retirements over future years.

          I’m satisfied.

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        • jnc4p's avatar
          jnc4p, on June 20, 2024 at 1:41 pm said:

          There’s also a related possibility that they need to be more modern to handle the more modern jets.

          Although I’m not sure if that holds given that they handled F-14’s pretty well.

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  13. jnc4p's avatar
    jnc4p, on June 18, 2024 at 8:56 am said:

    Perfect juxtaposition:

    Secret Service Agent Robbed at Gunpoint on Night of Biden’s L.A. Gala

    The agent’s bag was stolen on Saturday night in a residential community in Southern California, the authorities said.

    https://www.nytimes.com/2024/06/18/us/secret-service-robbed-biden-tustin.html

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  14. jnc4p's avatar
    jnc4p, on June 18, 2024 at 1:07 pm said:

    Trump ought to run ads on this and the withdrawal from Afghanistan to critique Biden’s foreign policy:

    U.S. Pier for Gaza Aid Is Failing, and Could Be Dismantled Early

    Officials hope a looming deadline will pressure Israel to open more land routes into the territory, which is facing extreme levels of hunger.

    By Helene Cooper and Eric Schmitt
    Reporting from Washington
    June 18, 2024, 1:46 p.m. ET

    The $230 million temporary pier that the U.S. military built on short notice to rush humanitarian aid to Gaza has largely failed in its mission, aid organizations say, and will probably end operations weeks earlier than originally expected.

    In the month since it was attached to the shoreline, the pier has been in service only about 10 days. The rest of the time, it was being repaired after rough seas broke it apart, detached to avoid further damage or paused because of security concerns.

    https://www.nytimes.com/2024/06/18/us/politics/gaza-pier-israel-aid.html

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  16. jnc4p's avatar
    jnc4p, on June 20, 2024 at 6:14 am said:

    Interesting that the premise here is that the President choosing to enforce or not to enforce federal law is optional.

    https://www.washingtonpost.com/health/2024/06/20/comstock-abortion-repeal-tina-smith-senate/

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    • Brent Nyitray's avatar
      Brent Nyitray, on June 20, 2024 at 2:53 pm said:

      I love how DeBoer refers to Defund the Police as “cops refusing to do their jobs”

      Accountability is kryptonite to the left.

      Like

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      • jnc4p's avatar
        jnc4p, on June 20, 2024 at 5:41 pm said:

        Call it a labor strike against management.

        His other ideological blind spot in the piece is in regards to Daniel Penny. People taking matters of public safety into their own hands is the exact response you would expect due to the failure to properly police mentally ill people.

        As one of his other examples cited shows, Jordan Neely could just have likely been about to pull out a gun and start shooting. With his record of unprovoked assaults, it’s clear he was a legitimate threat that day.

        Whether the force used was in excess of what the law allows will be decided at trial.

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        • Brent Nyitray's avatar
          Brent Nyitray, on June 20, 2024 at 10:11 pm said:

          Why would I risk bodily harm to arrest some violent dude when Alvin Bragg is going to decline to prosecute? What’s the point?

          Like

  18. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on June 20, 2024 at 5:06 pm said:

    Lefties doing anything to get rid Judge Cannon.

    https://archive.is/1GmaE

    I’m assuming it will work at some point.

    I don’t recall ever reading a story where Federal judges badmouth another Federal judge.

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  19. jnc4p's avatar
    jnc4p, on June 21, 2024 at 9:52 am said:

    Staff at the Washington Post successfully tanked their new editor:

    https://www.nytimes.com/2024/06/21/business/media/washington-post-editor-winnett.html

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  21. jnc4p's avatar
    jnc4p, on June 22, 2024 at 5:09 pm said:

    Interesting piece:

    Inside FICO and the Credit Bureau Cartel

    Mortgage lenders face destruction as a cartel of Experian, TransUnion, and Equifax work with FICO to drive them out of business. Regulator and anti-monopolist Rohit Chopra is pushing back.

    Matt Stoller

    Jun 22, 2024

    https://www.thebignewsletter.com/p/inside-fico-and-the-credit-bureau

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