Happy Friday! Brian Manning here's a weekly update. Let's get right to it. So Monday this week was a relatively quiet news day. The reason why is because the Federal Reserve started their symposium this week in Jackson Hole. That was concluded today ,we'll talk more about that. Some markets are on pins and needles this week waiting for today's meeting, which we'll talk about in a moment.

So Monday was relatively quiet. Tuesday, we got CNBC small business confidence survey, this survey is 2000 businesses across the country 75% of small business across the country expect their headcount or their employment to rate remain stable or decline. Only 38% actually think business conditions are good.

We also got some feedback on credit cards and credit card unpaid balances are up 16% year over year. The challenge in this and why I bring this up is because it just seems like the Federal Reserve is disconnected. And it's probably going to take a bad jobs number. You know, when you have business confidence surveys aren't great credit card numbers increasing job market, that's okay, across the board. It doesn't seem like it's a rosy economy, but the Federal Reserve is still hawkish in their tone. So we'll have to see what happens here.

We also got existing home sales for the month of July. Let's take a look at a chart here and see what existing home sales was doing. So month of July, this is close transactions, it was down 2.2% on a month over month basis, which I'm not surprised about. It's at a 4 million annualized pace, year to date is down 16%. But inventories also down as well. median home price was down 1%. Not a problem that doesn't bother us at all. Inventory though inventory moved from 1.0 8 million to 1.1 1 million, which is really nothing so it's up 3.7% month over month, but on a year over year basis inventory is down almost 15%. So we're just seeing still record low inventory across the country. Days on market move from 3.1 months to 3.3 months, a normal market is 4.6 months, so we're still in a seller's market. First time homebuyers that I love to see, increased from 27% to 30%. cash buyers remain in the same 26% investors were down a little bit as well. So so overall kind of a report that we're expecting and in line with existing home sales.

We also got some feedback from the BLS this week. This is the Bureau of Labor Statistics. The BLS is one of the sources that provides us employment info on a monthly basis. I've talked about this in the past was interesting as early this year, we just got a really strong blockbuster jobs report. And I came out and said, I wonder if the government's lying to us, I actually caught a lot of shit for that. I didn't mean it in a conspiracy theorists way. What I meant was, it just seems insane to me that you have such robust employment reports, month over month, and as you really tear it apart, the models that they use are not the most accurate. Plus you have part time jobs getting counted multiple times. And what happens is the reports come out. And when the report comes out, it's real time data, providing information for the prior month and the markets react.

Well, now, the BLS also goes back, they, they analyze all their data, and they came out and they said, Hey, and the March and April jobs report that we put out earlier this year, we kind of messed up and we overstated employment and we were off by 9% is challenging because markets are reacting to real time info. But when you go back and you update it, perhaps the employment is not as good as they think it looks, you know, and we're really feeling weakness around the globe right now. Is this just gonna have to be something we wait and see what happens.

We also got new home sales. This came out on Thursday. This is for the month of July, new home sales were up 4.4%. On a year over year basis, new home sales are up 31.5%. You know, existing home sales for resales are lower because there's no inventory, whereas builders have a little bit more inventory. So they're seeing their sales increasing. But what's amazing is you look across the country, new home sale inventory right now four homes you can purchase today's only at like 75,000 homes. So that's really not a lot of new home sales that are available. But new home sales are definitely seeing strength in the marketplace.

Today, we had the conclusion of the Jackson Hole symposium we had Jerome Powell speaking, he spoke at 1005 Eastern time, you know that his his speech had a hawkish tone to it. But it could have been much worse. The markets are kind of semi flat and their reaction. They're going to have another meeting coming up here in September, we'll have to wait and see what happens with the data that comes out.

We do have more inflation data that's going to come out between now and the Federal Reserve's next meeting, we're gonna have to see if that has an impact on their decisions. And if they're going to hike rates personally, right now, I'm not thinking they're leaning towards a rate hike, but we'll have to wait and see what happens.

And then lastly, today, we got core logic June report. So I bring this up, because as we've talked about in the past, shelter is an extremely high component of the inflation reports it makes up about 43% in the month of June CoreLogic, came out and said that rents were only up 3.3% On a year over year basis. This is 1414 consecutive declines in a row. Let's take a look at this real quick as well, because this has an impact on inflation and mortgage rates. So there's a lagging effect with shelter costs. And right now you see, if you look back to June of 2020, you had shelter costs really spike and the orange line here is going to be inflation and CPI and it's definitely a must slower incline as far as the inflation numbers are concerned, but you saw the shelter costs come up really quickly.

And then the shelter costs started the dive down beginning this year, but the shelter costs and the CPI report didn't crest until a few months ago, and now it's starting to move lower. The reason why I bring this up is because this is going to help inflation numbers going forward, it's going to be beneficial for mortgage rates. The challenge is right now the CPI, inflationary reading is saying CPI is at 4.7%. Again, the Feds mandate is 2%. Inflation, the PCE that they're most dialed in on this at 4.3%. Again, they're looking for a 2% inflation. So if we took this lag effect into account inflation today for CPI will be at 2.8%. And the core rate for PCE would be 3.4%. Well, if their mandate to get inflation to 2% is what really what they're focused on. I think it's gonna be really difficult to get there.

I unfortunately think it's going to take a lousy jobs report to really start for for the Federal Reserve to move the needle on what they're going to do as far as their monetary policy is concerned because inflation getting the 2% actually is gonna be difficult, and I'm not even sure if we can get there anytime soon. I'm around all weekend. If you want to learn how we're closing purchase transactions in 15 days, give me a call. I'd love to help you if you want to go through our pre purchase consultation. Reach out to me anytime. Happy Friday. Hope you have a great day.

-Brian

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