Wolf Richter on This Week in Money, by HoweStreet.com:
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Why Rising Mortgage Rates Threaten Canada’s Banks
Why Rising Mortgage Rates Threaten Canada’s Banks
Wolf Richter with Jim Goddard on This Week in Money:
Interest rates will continue to rise in the US and Canada. In both countries, potential buyers face affordability issues, which puts a damper on demand. But in Canada, variable-rate and adjustable-rate mortgages dominate (while ARMs are only 6% of all mortgage originations in the US), and currenthomeowners have to struggle with rising monthly payments of homes they bought at inflated prices. This has already started to happen. Here’s my take:
Home-equity-loan balances in Canada per capita are now 3.3 times what they were in the US during HELOC peak before it all collapsed. Read… HELOCs in the US & Canada: As “Scarred” Americans Learned Bitter Lesson, Canadians Went Nuts
Housing Bubbles Are Dangerous, That’s Why Canada is Finally Trying to Tamp Down on Them. And the US?
Housing Bubbles Are Dangerous, That’s Why Canada is Finally Trying to Tamp Down on Them. And the US?
Wolf Richter with Jim Goddard on This Week in Money:
The underlying dynamics are similar, but the approach is different.
Home prices experience a historic spike in Seattle, and sharp increases in other metros, but prices of condos in New York fall. Read… The Most Splendid Housing Bubbles in America
How People Turn into “Debt Slaves?”
How People Turn into “Debt Slaves?”
Wolf Richter with Jim Goddard on This Week in Money:
The Price of Easy Money, Low Interest Rates, and Debt Bubbles:
After the party, the hangover. Read… The State of the American Debt Slaves, Q1 2018.
Is the “Petro-Yuan” a Credible Challenge to Dollar Supremacy?
Is the “Petro-Yuan” a Credible Challenge to Dollar Supremacy?
Wolf Richter with Jim Goddard on This Week in Money:
China latest effort to get its currency to be used globally is the “petro-yuan.” Is it a credible challenge to the supremacy of the US dollar? If China dumped US Treasuries, what would that accomplish? And more…
Central banks around the world seem leery about the Chinese yuan. Read… What Could Dethrone the Dollar as Top Reserve Currency?
Rising Interest Rates: New Era with Tough Outcomes
Rising Interest Rates: New Era with Tough Outcomes
What will the bond market do? The conniptions in the Treasury market are causing pain in existing portfolios but offer opportunities down the road. What’s the impact of these rising interest rates on the housing bubbles in the US and Canada? Where is the pain threshold? How will it differ in the US and Canada? And what will higher interest rates do to new- and used-vehicle sales? We’re at the beginning of a new era with potentially tough outcomes.
The Fed’s monetary policy shift is finally taking hold. It just took a while. The Louis Fed Financial Stress index spiked beautifully and suddenly, from historic lows back in November. Read… “Financial Stress” Spikes. Markets, Long in Denial, Suddenly Grapple with New Era
