Beware of the alt-media economic novices

Watch out for the non sequiturs

Although this morning’s CPI price data (tabled below) come in lower than expected, they were expected to come in a ton higher than previous readings.

All I can say is that we are to own the assets. I hear the young folk pounding the table on a residential real estate collapse, but they don’t get it. As the dollar fade accelerates and prices continue to rise, the wealthy are looking for any place to park assets and housing and farmland are both logical choices.

There’s a reason why people pull their houses off the market. Unless they get a good price, they’re not selling. They don’t want to pay the capital gains taxes, nor do they have any alternative. Owning real estate in America is just like owning real estate in the lesser developed and more corrupt countries, like Argentina or Brazil. It’s an inflation hedge. And the numbers still make sense when I compare it with rental cash flows.

Cheap QE money fuels the frantic search for assets 

The Federal Reserve continues to suppress nominal bond yields across the board and are thus, perpetuating a financial world of cheap money. For instance, the 10-year note yield is almost matching real world inflation numbers. Before quantitative easing, the 10-year would be yielding 6 or 7%, or more, given the same sets of circumstances.

And if inflation rises to 5 or 6%, the 10-year note yield will be about 7%. That’s still cheap money.

And we wonder why stock prices continue to levitate and defy reality. It’s simple, the reality of today is much different than the reality of the past 100 years prior to the implementation of quantitative easing.

No shit, Sherlock. After a bump up in house prices of over 50% in 6 years, we should expect a small retracement. And that’s what we’re seeing, yet nationwide, house prices still continue to slowly creep higher. I let the economic novices cherry pick the data to suit their particular biases.

The smart money continues to buy, the dumb money makes excuses

The private equity firms are buying up real estate all across the board. They’re selling their commercial real estate and they’re buying the houses the young folk live in. Private equity is buying up the farmland we farm on. They’re picking our bones clean, while profane economic novices scream collapse. I think of Reventure. He gets a ton of traction on YouTube, because he satisfies a particular stupid bias that the edomites promote.

The great economic novice non sequiturs. The dollar collapses and house and stock prices fall. The price of gold and silver skyrocket, yet all the other assets collapse in price. Rock solid analysis.

Even the cooked CPI data is awful

CPI (MoM) (Mar)
Act: 0.9% Cons: 1.0% Prev: 0.3%

CPI (YoY) (Mar)
Act: 3.3% Cons: 3.4% Prev: 2.4%

Core CPI (MoM) (Mar)
Act: 0.2% Cons: 0.3% Prev: 0.2%

Core CPI (YoY) (Mar)
Act: 2.6% Cons: 2.7% Prev: 2.5%

Core CPI Index (Mar)
Act: 334.17 Prev: 333.51

CPI Index, n.s.a. (Mar)
Act: 330.21 Cons: 330.41 Prev: 326.79

CPI Index, s.a (Mar)
Act: 330.29 Prev: 327.46

CPI, n.s.a (MoM) (Mar)
Act: 1.05% Prev: 0.47%

Real Earnings (MoM) (Mar)
Act: -0.9% Prev: 0.1%