Since the beginning of the year I've been expanding into many commodities and inflation plays and have been periodically rebalancing my weights based on market moves
This is probably a bit more diversified than some may have thought, also why I thought I should start sharing
What this doesn't include:
- The ibonds I bought recently
- my checking account (enough for 2-3 months expenses typically)
- my wife's biz checking account
- value of real estate equity
- other property like cars and such
Feel free to like or critique all you want!
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I'm overdue on updating the fed pivot indicator, and frankly it's showing we have arrived already
We are at the point where the fed would usually halt rate hikes and begin easing again
As they gear up for 75bp in a couple weeks, they would be knowingly blowing up the system
This chart is essentially proxy for the acceleration rate of interest expense for the US government, and has been a reliable indicator of fed pivot for 30+ years as the fed has ensured the US doesn't enter a debt death spiral
what is a debt death spiral? It's an increasingly large debt load, with ongoing deficit, that only gets exponentially larger as interest expense increases
The treasury has to issue more bills/notes/bonds to fund interest which drives up supply and can overwhelm demand
Revisiting SMOEC, and updating some of the old excel charts for you guys
I've since begun tracking SMOEC (SIlver - MOney - EConomy) in trading view because its automated and easier, but there's some fun things in the excel charts also
As you can see it's been pretty flat, and has technically been flat since April 2020
Why use nominal GDP? I made SMOEC as a way to measure silver valuation levels without touching CPI at all, given the changes over the years to how it's measured. So Real GDP is a no go for me
The next step is to divide the silver price by said ratio and then you have what I call 'SMOEC' ("smoke")
I do think there is some subjectivity on how you draw the long term support line, so I've drawn both of my interpretations here
2nd one, new homes but using median prices, still up 15% from a year ago
And finally, the chart that matters most, all home prices, remember that existing homes make up the vast overwhelming majority of homes, it’s not even close
Still up 19% over last year, with a new print coming next week
The fed is in danger of crashing the housing market. The mortgage payment index adjusted for #inflation is now at a record high
Do I think that nominal home prices in the US will decline on a year-over-year basis? I still don't think so and here's why 👇
(click chart to zoom)
The mortgage payment index is comprised on 3 things: nominal home prices, interest rates, and inflation
Thus there are 3 ways this chart can decline back into the safety zone below the yellow trend line
1. Home prices decline 2. Mortgage rates decline 3. Inflation stays high
If you are expecting the fed to cause another 2008 by willingly hiking us into oblivion (a scenario they explicitly talk about never allowing to occur again), then you are expecting number 1, a home price crash