Hope for the Future: How We Can Move Beyond Doomerism.

Housing Market Updates. Bond Sell-Off.

Here is what we will be getting into today:

1. Doomer Prophecies Are Not as Dire as They Seem.

2. Navigating the Housing Market: Active Listings and Price Reductions Amidst Rising Mortgage Rates.

3. Global Macro Investors Response Due to Unprecedented Government Bond Market Sell-Off.

4. Why Hard Work and Innovation are Key to Achieving Success in Today's Economy.
   

Let's Dive In!

Newsletter: Noahpinion

Title: Don't be a doomer.
Link: https://noahpinion.substack.com/p/dont-be-a-doomer

Here are the key highlights:

• There has been arise to a doomer subculture on the internet which focuses on topics such as Covid, climate change, environmental destruction, and capitalism. These doomer prophecies may not be as dire as they seem.

• The doomer prophecies of late capitalism leading to its self-destruction have been around for a long time. However, contrary to what has been predicted, capitalism has not only survived but also flourished in many parts of the world. As a result, humanity is now richer than ever before and poverty rates have drastically decreased in both low-income countries and developing countries.

• This growth can be largely attributed to free-market reforms and an increased focus on social safety nets. Furthermore, wage inequality has also decreased thanks to rising wages for low earners since the mid-2010s. This is due in part to public social spending increasing as a share of GDP which has provided access to programs such as Social Security, SSDI, Medicare, Medicaid, unemployment insurance, Section 8 housing vouchers, SNAP, the EITC and more. These safety nets have had significant positive effects such as reducing child poverty by 57% between 1993 and 2019.

• The doomers’ preoccupation with Covid is misplaced too since it is no longer at the top of Americans’ priorities list and deaths in the West are stable due to unprecedented efforts by human science which developed effective vaccines quickly.

• Climate change is a real threat that we must take seriously, but recent progress has been encouraging and doomerism can be detrimental to our ability to focus on the problems that matter most. This means understanding the risks and taking action to reduce emissions. However, it is important to acknowledge that recent progress in the fight against climate change has been encouraging. Recent climate models have all but ruled out most of the worst-case scenarios for warming. According to Zeke Hausfather, there is now a good chance that we can hold warming below the 2 degree level, which is around the point where catastrophic events begin to happen.

• In addition, estimates of emissions during the 2010s have now been revised downward and emissions are now growing only slowly. Many forecasters now expect the peak of annual global emissions to occur in the next couple of years.

Website: Wolf Street

Title: Mortgage Rates Near 7% for Spring Selling Season: Prices of Existing Homes Fall 13% from Peak, on Lowest Sales since 2010
Link: https://wolfstreet.com/2023/02/21/mortgage-rates-near-7-for-spring-selling-season-prices-of-existing-homes-fall-13-from-peak-sales-drop-to-lowest-since-2010/

Here are the key highlights:

• The spring selling season has officially begun, and with it comes a set of new challenges for potential sellers looking to get realistic about pricing their properties at current mortgage rates. Hopes that Mortgage rates would drop due to a quick Fed pivot and steep rate cuts are now fading as the average 30-year fixed mortgage rate rose to 6.87%. This is further compounded by the 10-year Treasury yield moving in on the 4% mark currently at 3.96%.

• The National Association of Realtors reported that sales of previously owned houses, condos, and co-ops fell by another 0.7% in January from December, to a seasonally adjusted annual rate of sales of 4 million homes - this was the 12th month in a row of month-to-month declines on this seasonally adjusted basis and sales dropped by 37% year-over-year to the lowest since 2010.

• Sales of single family houses fell by 0.8% in January from December and 36% year over year while sales of condos and co-ops were roughly unchanged from December but plunged 43% from January a year ago, indicating that all regions experienced declines in sales due to low mortgage rates coupled with high prices resulting from inflated demand earlier this year

• Active listings jumped by 65% from a year ago, but were still low by historical standards as potential sellers are waiting for the Fed to slash its interest rates so that mortgage rates could plunge back to 3%. Of all active listings, 30% had price reductions in January, showing that sellers are beginning to explore the market clearing price which is a good sign in terms of unfreezing the market.

Newsletter: Fidenza Macro

Title: The trade is in the liftoff, not the landing.
Link: https://fidenza.substack.com/p/the-trade-is-in-the-liftoff-not-the

Here are the key highlights:

• In recent weeks, global macro investors have been taking advantage of an unprecedented opportunity to benefit from a selloff in Treasuries and other government bond markets due to improved economic data. This trend has been driven by the reopening of China’s economy and a flood of liquidity coming out of the country.

• The Federal Reserve’s Mester and Bullard have even suggested that a 50 bp hike should not be ruled out, which could lead to higher yields if inflation remains persistent.

• Investors have taken advantage of this trend by positioning for higher US yields in order to protect their portfolio from losses on USD/JPY and XAU shorts. This allows them to benefit from BoJ policy normalization without having to cover their shorts.

• Oil, however, has not responded well to the improved global economic backdrop for three reasons - elevated US inventories (including further sales of the US Strategic Petroleum Reserve), Russia meeting Chinas petroleum needs, and a risk off tone permeating the markets since last week.

Website: ZeroHedge

Title: Explaining The Value Of Labor To Leftists Who Hate The Concept Of Work
Link: https://www.zerohedge.com/economics/explaining-value-labor-lefists-who-hate-concept-work

Here are the key highlights:

• Many young people are struggling to achieve their desired level of success due to the current economic climate. As a result, there has been a surge in leftist movements such as the anti-work and quiet quitting movements.

• However, while these movements may appeal to inexperienced individuals, they fail to grasp the laws of supply and demand regarding labor, and that those with more skills are likely to earn more money.

• Inflation has caused an increase in demand for workers, but this is a temporary fix and may result in future layoffs. Those who work hard to improve their productivity during times of crisis are more likely to succeed, whereas those who complain and remain idle may not fare as well.

• The only way for individuals to secure higher pay and a better position is by offering something more than just their time; this means being innovative and becoming a producer rather than relying on unskilled labor alone.

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