Friday Update March 11, 2022

Don't drink and drive this weekend.  Or at all.  Don't take shots of Bushmills before running a 5k.  Don't spend $1,300 on a bar tab and wake up in horror the next morning.  Don't be me in 2015.

Alrighty 309 single family existing homes available today.  Much better than the 155 we had on Wednesday.  This makes sense as the first half of March inventory tends to pick up a little bit as demand also picks up, and only thirsty agents list on Wednesdays.  We should see peak inventory levels by roughly mid June with an upward trend between now and then.  

The PPMLS (our local MLS for basically Colorado Springs MSA) bundles patio homes and single family homes for their active inventory and so their math is a bit different from what I'm using.  But let's use their metrics for comparison.  PPMLS has 653 total active listings right now which includes more than just El Paso County and includes new builds as well as a few patio homes.  For perspective in March 2021 we had 462 units, March 2020 1,328 units, March 2019 1,461 units.  March 2010 we had 4,773 units.  So yea we have a few more units to look at now than a year ago, and about 850% less than 12 years ago.  In the last 12 years our prices have also gone from a median of $189,900 to $470,000.  Pretty neat!

Interest rates are signaling that the market really isn't taking the war in Ukraine too seriously.  Much like Russia's land forces.  We saw rates plummet 2 weeks ago to under 1.7% on the 10 year yield and today we close at 1.99%.  Basically same levels as before the war started.  I'm not saying what is happening there isn't horrible, not saying anything about that shit show at all.  What I'm saying is the market has discounted that entire situation.

A few years ago and a bit recently I've ranted a lot about the yield curve.  Specifically the difference between yields on 2 and 10 year US treasury bonds.  We're seeing it tighten quite a bit to around .25% and if you recall anything less than 0 signals a recession to follow.

We could see the yield curve bounce off and go back up but I'll keep a close eye on it for you.

Janet Yellen, who is a rich old white woman and the head of the US treasury, tells us that we should brace for another year of high inflation rates.  On this I believe her for once.  Her assets will do great, as will yours if you own any.

 While blaming everything on oil prices and Russia is a childishly simple understanding of how the world works the war is certainly not helping the inflation rates in the US.  Another thing that really isn't helping is the fact that we have a 3 Trillion USD Federal budget deficit which will once again get monetized with fresh debt.  In order to get one dollar of debt monetized you need a one dollar federal reserve note.  You know the deal guys.

I've spent 4 days out of this week huffing glue in my new build because I can't bring myself around to paying plumbers over $200/hour.  Maybe I'm wrong and quite possibly I'm an asshole but for that kind of money I'm happy to do it myself.

The reason I bring that up though is not because I don't think that plumbers deserve that kind of money.  I bring that up because they are getting it.  And as people get paid more money they tend to spend more money.  As this wage inflation makes its way across the market more and more people have more money to spend.  And with the rate of inflation at 7.9% it makes hardly any sense to save money, so people do spend it.  

My opinion guys, as the dude that's been bitching about inflation since like 2018 and was even ridiculed for it in 2020, this is the beginning.  We have a budget that is 100% FUBAR.  We have the 2020 recession getting ready to land right in 2022 amid what could easily turn into a global war.  If the thing from 2020, you know with the cruise ships and the bats, taught us anything it's that our government has no contingency plan other than printing money.

Do your best to own something.  It's not going to get any easier before getting a lot harder.  Muster up some gusto and own something.  If not for yourselves than for those you care about.

It's not easy.  It's not fair.  We can help you through it.  But you gotta be about it.


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