Equity 1 Group
Pushing back the frontiers of economic ignorance and restoring sound financial foundations, one family at a time.

Jun
30

Likely surpass historical high reached in 1946, prompted by a spending push to fund World War II

WashingtonPost |  by Jeff Stein

US Debt Ball Chain

Government debt is on track to hit historically high levels and, at its current growth rate, will by 2028 be nearly equal in size to the U.S. economy, the Congressional Budget Office said Tuesday.

The debt is projected to grow to 96 percent of GDP by 2028 before eventually surpassing the historical high of 106 percent it reached in 1946.

Currently, the federal government’s debt burden is about $15 trillion, according to Marc Goldwein, senior vice president of the Committee for a Responsible Federal Budget. Read the rest of this entry »

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Jun
30

“The bursting of the housing bubble was covered up with quantitative easing, and now we’re seeing the ‘everything bubble’ starting to show the first signs of popping”

NewsMaxFinance  |  Trevor Gerszt

Image: Are You Worried? If Not, You Should Be

Despite the unsustainability of the 2016-2018 stock market run, many bullish analysts and investors still think that there is room left for markets to rally. The unease of the past few months that has seen the Dow lose over 2,000 points from its all-time highs is, to their minds, just a temporary correction, a speed bump on the way to greater gains. While having a positive attitude is normally a good thing, when it comes to your investments you can’t look at the world with rose-colored glasses.

Read the rest of this entry »

Jun
30

“…labeled a ‘speculative bubble’ earlier this week by Nobel economics prize winner Robert Shiller.”

NewsMax  |  Bloomberg News

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Bitcoin sank further below $6,000 on Friday, heading for a second straight month of declines at around 20 percent, as demand for the largest cryptocurrency continues to suffer from security and regulatory concerns.

The digital currency slid to about $5,861 early Friday, according to composite Bloomberg pricing, touching the lowest since November. Rival coins including Ethereum, Ripple and Litecoin also retreated. All are set for declines of about 20 percent or more in June.

Confidence in cryptocurrencies is being tested this year with hacks from Japan to South Korea raising security questions. At the same time, central banks and other regulators across the globe have warned about the potential for investor losses and fraud, casting a shadow over the asset class half a year after Bitcoin won a place on Chicago derivative exchanges.

Bitcoin, which is down almost 60 percent this year, was labeled a “speculative bubble” earlier this week by Nobel economics prize winner Robert Shiller.

Jun
30

“Dead Coins lists around 800 tokens that are effectively worth nothing, while Coinopsy puts the tally at more than 1,000.  Fewer than 4 percent of coins…were successful or promising…”

BloombergNews  |  Adam Haigh & Eric Lam

See the source image

Bitcoin’s meteoric rise last year had many observers calling it one of the biggest speculative manias in history. The cryptocurrency’s 2018 crash may help cement its place in the bubble record books.

Down about 70 percent from its December high after sliding for a fourth straight day on Friday, Bitcoin is getting ever-closer to matching the Nasdaq Composite Index’s 78 percent peak-to-trough plunge after the U.S. dot-com bubble burst. Hundreds of other virtual coins have all but gone to zero — following the same path as Pets.com and other red-hot initial public offerings that flamed out in the early 2000s.

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Jun
27

“The agency has noticed an increase in illegal activity facilitated by digital-currency payments”

NewsMaxFinance  |  Bloomberg News

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The Federal Bureau of Investigation has 130 cases tied to cryptocurrencies, according to an agent speaking at a digital-asset industry conference in New York.

The cases “threat tagged” to virtual currencies encompass crimes such as human trafficking, illicit drug sales, kidnapping and ransomware attacks, according to Kyle Armstrong, a supervisory special agent.

“There are thousands of cases in the bureau, so it is a small sliver at this point,” Armstrong said at the Crypto Evolved conference Wednesday. The agency has noticed an increase in illegal activity facilitated by digital-currency payments, he added.

Read the rest of this entry »

Jun
27

The question now for Fed policy makers and financial markets is to what extent, or whether, these more-elevated costs of doing business are passed on in the form of higher goods and services prices for American consumers.

NewsMaxFinancial  |  Bloomberg News

Purchasing Power Cut

Prices of materials used in U.S. manufacturing have been mounting for many months. Now signs are emerging in Texas and along the East Coast that more producers are having greater success passing on some of those costs to customers.

Recent regional Federal Reserve surveys also indicate that not only is the build-up in price pressures extending to service providers that make up the biggest part of the economy, but wages are also firming as the tight job market places a premium on skilled workers.

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Jun
27

On a year-on-year basis, pending home sales fell for the fifth month in a row in May.

NewsMaxFinance  |  Reuters / Thompson

Home Sale Decline

Contracts to buy previously owned homes unexpectedly declined for the second straight month in May, mostly due to a shortage of properties for sale.

The National Association of Realtors said on Wednesday its pending home sales index fell to a reading of 105.9, down 0.5 percent from the prior month. April’s 1.3 percent decline was unrevised.

Economists polled by Reuters had forecast pending home sales rising 0.5 percent in May.

On a year-on-year basis, pending home sales fell for the fifth month in a row in May.

Read the rest of this entry »

Jun
27

This marked the index’s biggest fall since the 6.6 percent drop in the week of Feb. 16.

NewsMaxFinance  |  Reuters / Thompson

Mortgage Application

U.S. mortgage applications recorded their steepest weekly fall in over four months even as most home borrowing costs fell in step with lower bond yields, the Mortgage Bankers Association said on Wednesday.

The Washington-based industry group’s seasonally adjusted index on loan requests to buy a home or to refinance an existing one fell 4.9 percent to 365.3 in the week ended June 22.

This marked the index’s biggest fall since the 6.6 percent drop in the week of Feb. 16.
Interest rates on most mortgages fell from the prior week, although the average rate on 30-year conforming loans or those with loan balances of $453,100 or less, edged up 1 basis point to 4.84 percent.

Last week, home borrowing costs generally declined with Treasury yields as investors preferred U.S. government bonds and other less risky investments because of worries about the escalating trade conflict between China and the United States, the world’s two biggest economies.

Jun
21

Home price appreciation, coupled with rising mortgage rates, have pushed three-quarters of average wage earners out of the market with property costs rising faster than wages in 64 percent of regions surveyed

NewsMaxFinance  |  Bloomberg News

Image: Realtors: Homes Prices Least Affordable in Decade

The American dream continues to fade for many people. Housing affordability dropped this quarter to the lowest since late 2008, according to data released this month by the National Association of Realtors.

In May, the median price of a previously owned homes rose to a record $264,800, NAR data show.

A separate report from ATTOM Data Solutions shows average wage earners would need to spend 31.2 percent of income to buy a median-priced home this quarter — above the historic average of 29.6 percent.

Home price appreciation, coupled with rising mortgage rates, have pushed three-quarters of average wage earners out of the market with property costs rising faster than wages in 64 percent of regions surveyed, ATTOM reported.

“Home price appreciation continued to outpace wage growth, speeding up the affordability treadmill for prospective homebuyers even without the rise in mortgage rates,” said Daren Blomquist, senior vice president at ATTOM.

Jun
21

“It’s one thing to finance your education or home purchase, or even a car purchase in some situations … but to finance a vacation is to me just insane. If you can’t afford to pay for your vacation out of cash on hand, don’t take a vacation.”

MarketWatch  |  Maria Lamagna

Vacation Loan

Denise Phillips, a military veteran and mom who has three sons in the service, wanted to book a trip to Hawaii to spend Thanksgiving with one of her children.

But she didn’t want to pay for the trip all at once. So she started searching online for installment plans and found one through the lending company Affirm.

Read the rest of this entry »