New High for the 10-year, SPR drain resumes, and a Vax-Damage #MeToo

• Fed Balance Sheet (WALCL): -22B (-0.28%) w/w.  Declining.
• Total Bank Credit (TOTBKCR): +10.7B (+0.06%) w/w.  Flat.
• New Home Sale Price (MSPNHSUS): $-6300 (-1.46%) m/m.  Now 14% off the high.
• 30 Year Mortgage Rates (MORTGAGE30US): 7.31% (+12 bp).  New high.
• Auto/Light Truck Sales (ALTSALES): -712k (-4.74%) m/m.  Declining after lower high.
• Gross Domestic Product (GDP): +249B (+0.92%) q/q.  Not adjusted for inflation.
• Personal Consumption (PCEC): +149B (+0.81%) q/q.  New high.
• Durable Goods – Orders (DGORDER): +455M (+0.16%) m/m.  5.6% off the highs.
• Strategic Petroleum Reserve (WCSSTUS1): -250k (-0.07%) w/w.  Drain restarting.

Whew, that was a lot.  Bank credit is now moving sideways – dreadful for a money system that demands constant growth.  To me, this signals banking trouble ahead, along with effective credit contraction.  The Fed continues to QT their Treasury and MBS holdings, and the 30-year mortgage rate is at yet another new high.  All the factors are in place to inflict a recession – in real estate, and for business that depends on a credit line – can you imagine the impact of adjustible rate loans?  So far that hasn’t shown up in durable goods (a new all time high last month), or consumption, but may be appearing in auto sales which hit a new, lower-high in 2023, and is now fading.  If the product sales depends on debt (cars, houses), it should probably drop in price going forward, at least for now.  And of course the Biden-Handlers have started draining the SPR once again.  Because – “taxpayer funded campaign contribution”, which they call “democracy.”

The buck rose 0.55 [+0.53%] to 105.81; it was higher than that mid-week, but fell on Thursday and Friday.  The dollar’s uptrend remains firmly in place.  People waiting for that dollar-to-confetti event have a bit longer to wait, it seems.  Maybe that happens when Biden-Handlers finally empty the SPR?

The bank-destroying 10-year yield broke out to a new 16-year high, rising 14 bp to 4.58%, a level last seen in October 2007.  Happy news if you’re in cash – not so happy if you are a bank or a pension fund that owns a lot of these monsters.