DarthTrader
Diamond Member
- Mar 29, 2022
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I made a post that detailed a lot of indicators in the Stock Market Forum but no one goes there apparently. Here's a brief set of indicators:
www.buildings.com
US Office space square foot under construction PEAKS just before MAJOR recessions.
It peaked around:
What tends to happen is the rising equity in property causes property owners to take out equity and buy more property to try and increase cash flow.
This happens in all classic business cycles back until the beginning of time.
Ever since the days we could save more seeds than we've eaten, we've tried to plant more fields as much as possible in the fat years until oversupply causes the whole debt-system to contract.
Usually inflation precedes these debt-driven deflations, it preceded it in dotCom, and in 2006, and in both cases the FEDs raised rates to try and curb inflation.
In 2006 the FEDs raised rates 14 times, then the yield curves inverted, the FEDs raised rates 3 more times before the whole system imploded.
We have now raised rates one time and the yield curves inverted. If the FED raises again by 50 bp that = 2x raises (each raise being 25bp).
We are raising rates to combat the worse inflation in 40 years, at the worst possible time to do so, with bubbles everywhere, housing especially. Office space bubble is gigantic. No one can afford 6%+ mortgages at these housing prices.
And no one can tolerate 7%+ inflation.
Something has to break, and if it's a choice between inflation and the economy, the FEDs will smash the economy to bits.
More sources:
knowledge-leader.colliers.com
- Housing sales dropped in the largest drop ever, bigger than ever dropped in 2007. 7.2% drop last month. The entire year of 2007 saw a housing sale drop of only 18%. We almost hit 50% of the drop in 2007, in just one month.
- Housing bubble is MASSIVE.
- Inflation is through the roof, monetary inflation, due to helicopter drop of $4.8Trillion.
- Russia war is driving Oil and all commodities through the roof.
- US weaponization of SWIFT and US Dollar endangers its ability to finance its debt.
- Warren Buffett started buying companies again (Occidental and Allegheny); he has a notorious habit of buying companies just before stock market loses 40%. Go look at his track record.
- Yield curves inverting like crazy.
U.S. Office Market First Look: 2006-Q4
Grubb & Ellis offers a fourth-quarter summary and makes predictions for the 2007 office market
www.buildings.com
US Office space square foot under construction PEAKS just before MAJOR recessions.
It peaked around:
- 120million sq feet in 2000
- 140million sq feet in 2006
- 142million sq feet as of FEB 2022.
What tends to happen is the rising equity in property causes property owners to take out equity and buy more property to try and increase cash flow.
This happens in all classic business cycles back until the beginning of time.
Ever since the days we could save more seeds than we've eaten, we've tried to plant more fields as much as possible in the fat years until oversupply causes the whole debt-system to contract.
Usually inflation precedes these debt-driven deflations, it preceded it in dotCom, and in 2006, and in both cases the FEDs raised rates to try and curb inflation.
In 2006 the FEDs raised rates 14 times, then the yield curves inverted, the FEDs raised rates 3 more times before the whole system imploded.
We have now raised rates one time and the yield curves inverted. If the FED raises again by 50 bp that = 2x raises (each raise being 25bp).
We are raising rates to combat the worse inflation in 40 years, at the worst possible time to do so, with bubbles everywhere, housing especially. Office space bubble is gigantic. No one can afford 6%+ mortgages at these housing prices.
And no one can tolerate 7%+ inflation.
Something has to break, and if it's a choice between inflation and the economy, the FEDs will smash the economy to bits.
More sources:
U.S. Office Market: Is Over-Supply Looming? - Knowledge Leader - Commercial Real Estate Content Hub
Construction activity in the U.S. office market remains elevated while absorption levels are muted. Is this pattern set to continue leading to rising vacancy and downward pressure on rents and pricing? The amount of office space under construction in the U.S. stands at 117.2 million square feet...
knowledge-leader.colliers.com
