Adam Taggart: Brace for a credit crunch + a “serious” recession

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Pending Home Sales Crash -14.8% YoY As Fed Pushes Rates Up, Negative Growth For 24 Of Last 25 Months

The Biden Administration has been quick to praise the 2.4% Q2 Real GDP growth, a figure that seems underwhelming at best considering the monumental volume of government stimulus spending and aggressive monetary policy tactics implemented by the Federal Reserve. Despite these extraordinary measures, they have only managed to produce a mediocre growth rate. To add to the grim state of affairs, the housing market is presenting a dire scenario. June witnessed a severe slump in pending home sales, which fell by a startling 14.8% year-over-year. This precipitous drop stands as a brutal testament to the underlying weaknesses in the housing sector, which is being hammered by issues like high unemployment rates, soaring construction costs, and a critical shortage of affordable homes. The end of eviction and foreclosure moratoriums also looms ominously, likely to add further downward pressure on the housing market. With these alarming indicators, it’s clear that the economic policies being pursued might be less about fostering genuine, sustainable growth, and more about creating the illusion of economic stability.

 





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