Syz the moment

Source: Yahoo Finance

People’s Bank of China Gov. Pan Gongsheng announced a flood of support measures in a rare press conference Tuesday amid a deepening economic slump, including the biggest package yet for housing. Measures went beyond most expectations targeted at property, banks and directly, the equity market. Beijing will cut the amount of cash banks need to have on hand, known as the reserve requirement ratio, or RRR, by 50 basis points in the near term, he said. Pan also said the PBOC would cut the 7-day repo rate by 0.2 percentage points, and signaled that a 0.2-0.25% cut in the loan prime rate could follow. Stocks are flying led by brokers and property. Some other China proxies like iron ore and Aussie are also trading higher. Source: David Ingles

Because the current mortgage rate (6.1%) is significantly higher than the profit/cap rate (4.4%) of rentals. This means that any investor who uses debt to finance their purchase is likely losing money on cash flow from Day 1. Note how from 2012-2022, the opposite was true. Cap Rates were higher than mortgage interest. Which is why so many people piled into single-family rentals. This is no longer the case... Will the Fed jumbo rate cut start to fix this? Source: Nick Gerli, re:venture

The median amount of US consumers' stock market investments hit $237,000. The value has DOUBLED in 1 year. Such a spike has never been seen before. Source: Global Markets Investor

In order to 'average' out the recent period of high inflation at 2%, the fed would have to tolerate a period of time of deflation. But can they really afford deflation with $33T of debt and persistently high budget deficit? As mentioned by Peter Boockvar on X, once purchasing power is lost, it is lost forever because central bankers won't let you get it back... Last week, Federal Reserve Governor Chris Waller inadvertently made that perfectly clear when he spoke on Friday. He told CNBC in an interview that "What's got me a little more concerned is inflation is running softer than I thought."... Bottom-line: It is very unlikely that inflation will come back to trend line in the foreseeable future. Perhaps the jumbo rate cut was also about making sure that the US economy doesn't fall into a deflationary trap... Welcome to the era of fiscal dominance Source chart: Bloomberg

US jobless rate rose from 3.4% in April 2023 to 4.2% in August near the highest in 3 years. In the past, when the unemployment rate was rising, the S&P 500 index saw significant declines. The us jobs reports in the coming weeks will be key... Source. Global Markets Investor

Source: Markets & Mayhem

Source: The Investing for Beginners Podcast @IFB_podcast