Dollar Winning Streak Continues For Fourth Day Pushing Oil Lower; Futures Flat

Following two days of rangebound moves, where Monday’s modest market rebound was undone by the Tuesday just as modest decline (despite the early surge higher on the latest “bullish for stocks” European terrorism), overnight equity action continued to be more of the same, and as of this moment S&P 500 futures were unchanged, while European stocks were modestly higher. But while equities remain surprisingly uneventful despite loud warnings by both JPM and Goldman now that another bout of volatility and equity downside is coming, in FX there has been a substantial change, one which has seen the US dollar rise for a fourth day, the longest winning streak in a month, driven by the latest round of hawkish Fed jawboning courtesy of the Chicago Fed’s Charlie Evens yesterday, which in turn has pushed down prices of oil, gold and copper.
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As noted earlier by Bloomberg, the greenback gained against almost all of its major peers, with only the Japanese yen keeping pace, after a Federal Reserve official commented on the interest-rate outlook. This is in line with a warning issued by JPM yesterday, according to which selling of USD is about to fall out of vogue as it heads for worst month since 2011. The bank said hedge funds cut bets on further gains in dollar to the lowest since 2014 prior to last week’s Fed meeting, and with speculators having already ditched the U. S. currency, few are left to sell and push it down further, making greenback less susceptible to outflows of hot money. The last 4 days appear to have confirmed just this.

This post was published at Zero Hedge on 03/23/2016.

When $250,000 per year salary could qualify you for subsidized housing. 100,000 Apartments come online in Q3 of 2015, most since the late 1980s.

There were two housing stories that stood out to me today. One shows the pure absurdity of housing in California, in particular Northern California. As we’ve discussed before a home is expensive or affordable only as measured by incomes in the local area. Well for Palo Alto, it looks like having a salary of $250,000 per year could qualify you for subsidized housing. Of course having this income puts you in the top 2 percent of all U. S. households but in Palo Alto you might as well be eating Purina Dog Chow with a nice class of Manischewitz. The Bay Area is running on hot money from the tech industry. Another story focuses on the continuing rental revolution we are undergoing. In Q3 of 2015 100,000 apartments came online, the most since the late 1980s. And most were rented within 12 months. I think these stories really highlight the larger theme in housing – extreme money for hot enclaves and renting for the vast majority. The middle is being cleaned out like using a melon baller on a cantaloupe.
You are broke on $250,000 in Palo Alto
People in the Bay Area are so far removed from reality that $250,000 now could qualify you for subsidized housing. It is so preposterous yet in an area where tear downs go for $1.5 to $2 million, you would need a sizable income to buy a home here.
‘PALO ALTO (CBS SF) – Palo Alto is seeking housing solutions for residents who are not among the Silicon Valley region’s super-rich, but who also earn more than the threshhold to qualify for affordable housing programs.
The city council has unanimously passed a housing plan that would essentially subsidize new housing for what qualifies as middle-class nowadays, families making from $150,000 to $250,000 a year.’

This post was published at Doctor Housing Bubble on March 23rd, 2016.

Canadian Banking Regulators Sound the Alarm

The shouts of warning are finally starting to come out from official bodies. Since the collapse of the oil and gas market, we have been writing about the fact that we haven’t seen the worst yet.
As I have previously written, Canada and Russia are two countries that have been absolutely devastated by the crashing oil markets. The oil and gas crash has racked the Canadian economy and resulted in massive layoffs in the industry and those that support it. Yet the ripple effect has yet to take full effect and the corresponding regulatory bodies are just starting to take notice.
The Canadian banking sector, along with the Commodities sector, constitutes a massive part of the Canadian economy. Therefore, it is not surprising to learn that the former is now controlled by the latter and in a major way.
Alarm bells are ringing as growing unease settles across the Canadian banking sector. They know that defaults are coming in a massive way. Most people employed in the commodities sector enjoyed large incomes and therefore they splurged on large and expensive toys to go along with their income, as many people do. Unfortunately, this means another thing – large loans, which are becoming more and more unlikely to be repaid.

This post was published at GoldSeek on Thursday, 24 March 2016.

Oil Drops To $40 Handle After IEA Warns Production Freeze Is “Meaningless”

It appears The IEA has come to the same reasoning as we have been pointing out for weeks – “freezing” production at what is already the highest output levels ever is “meaninglesss.” As Reuters reports, Saudi Arabia is the only country with the ability to increase output, a senior executive from the International Energy Agency (IEA) said on Wednesday. This reality check appears to have stalled crude’s exuberant run as WTI pushed below overnight API “build” lows.

This post was published at Zero Hedge on 03/23/2016.