Peter Boockvar

Housing starts in December totaled 1.7mm, 50k more than expected and up from 1.678mm in November. The upside was all in multi family as single family starts fell by 17k m/o/m. Multi family was up by 51k m/o/m to the highest since February 2020 at 530k. Of note was the permit print of 1.873mm, 170k higher than forecasted and up from 1.717mm in November. Again, …

[Read more...] about Starts and Permits

What is noteworthy about the higher labor expenses that JPMorgan, Citi, and Goldman talked about in their earnings calls is that the wage gains are now reaching the upper echelons of the pay scale and it's not just a minimum wage and leisure and hospitality influence. Goldman CEO David Solomon said yesterday "There is real wage inflation everywhere in the economy, …

[Read more...] about Rising up the scale

The January NAHB home builder survey was down 1 pt m/o/m to a still very high 83. The estimate was for no change and compares with 83 in November and 80 in October. It peaked at 90 in November 2020. Present conditions were unchanged while future expectations slipped by 2 pts. Prospective Buyers Traffic gave back the 2 pt gain in December. Here is the continued …

[Read more...] about Home builder sentiment

The January NY manufacturing index, the 1st January industrial figure to be seen, fell sharply to -.7 from 31.9 in December and that was well under the estimate of 25. That’s the weakest print since June 2020. Shipments declined to just 1.0 from 21.7. New orders fell to -.5 m/o/m from 27.1 while backlogs were lower by 7 pts to 12.1. Inventories were up by 1.2 pts to …

[Read more...] about New York area takes a pause

What's most noteworthy about the rate move today is the rise in the short end. The one yr yield is over .50% at .513%, up 2 bps and the 2 yr is jumping above 1% at 1.04%, up 7 bps. So while the 10 yr yield is rising too, the curve is flattening further, with the 2s/10s narrower by another 4 bps to 78 bps. The 5s/30s spread is down to 51.5 bps vs 56 bps on Friday. Go …

[Read more...] about Some things of importance

Just a follow up: At the end of 2021 I mentioned my bullish stance on the Macau casino stocks. One of the factors was the expectation of a renewal of the 6 licenses and a soon to be finalization of the 20 yr old rules. If you didn’t see, the Macau government overnight announced the number of licenses will be kept at 6 and for a concession term of 10 years. The …

[Read more...] about Macau update/Confidence dampened by inflation

Retail sales in December fell a sharp 3.1% m/o/m at the core and there was no respite on the revision to November as that was revised down by 4 tenths to a decline of .5%. These are NOMINAL numbers so on a REAL basis they are even worse, much worse. Versus November there were declines in auto’s/parts, furniture, electronics, food/beverages, clothing, sporting …

[Read more...] about Nominal retail sales weak, real worse

It's really amazing to now hear Fed members try to out hawk each other with plans for rate hikes after QE ends and then QT after being so dovish for so long and so badly misreading the inflation story. I mean it was just in November when SF Fed president Mary Daly said "monetary policy is in a really good place." That place then was the start of a modest pace of taper …

[Read more...] about How to get on a stairway to heaven instead of a highway to hell?

The December PPI was up .2% m/o/m headline and .5% core. The headline figure was 2 tenths below expectations but offset by a 2 tenths upward revision to November to 1%, so thus as expected when taken together. The core rate was in line but November was revised up by a 2 tenths too to a .9% increase. Versus last year, PPI was up 9.7% and 8.3% ex food and energy. Food …

[Read more...] about PPI and Claims