2016 Oct 25, 10:21am
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51% of home mortgages now originate from commercial bank lenders. The rest is coming from "shadow" banks.
I'm dealing with this now.
The Indymacs are back.
We are already seeing genuinely smart money get the hell out of the market as developers and wholesale promoters/sellers in hot markets such as Miami, Phoenix, Inland California, Chicago, etc, which were some of the hardest hit areas in 2008.
Commercial projects in the 60mm and up range are beginning to evaporate, even if they were approved previously, also (condo towers, hotels, retail, etc.).
The trigger for the price collapse and repos of homes and commercial properties during 2009-2010 redux will be the same as it was back then - jobs (quantity declining and wages declining).
Watch U6 data and also real wage data.
If we see large-scale layoffs at medium and large firms post November 8th start to pile up, especially before retail season of November through January, it will confirm that those claiming the "riggedness" has permeated even actual, true economic data, and conspired to create a false, positive impression of the actual health of the underlying economy, will be vindicated.
Not quite as bad as in the housing bubble, where all you needed was a pulse. Worth monitoring though. Thanks for the heads up.