Demand for Homes Drops to (Near) Record Low as Inventory Rises. Now Come the “Stabilizing Home Prices”: NAR

“The market is at an interesting point with rising inventory and lower demand”: National Association of Realtors

By Wolf Richter for WOLF STREET.

We here in our little corner don’t normally more than glance at the “pending home sales” data by the National Association of Realtors. It’s a forward-looking indicator of “closed home sales” based on contract signings – on deals that haven’t closed yet and could still fall apart. But today’s release of pending sales was interesting for several reasons, including the NARs’ expectation that the collapsed demand along with rising inventories is going to cause home prices to “stabilize” in the second half of the year. So here we go.

The index value of pending home sales in May dropped by 2.1% from April, and by 6.8% from a year ago, to 70.8 (seasonally adjusted annual rate), what headlines dubbed an “all-time low” or “record low” in the data going back to 2001, and that’s close enough. In the NAR data we have access to via YCharts, today’s reading was still a hair above the prior all-time low of April 2020 (index value of 70). But the idea is the same: demand has collapsed, even as inventories have risen.

Berkshire Hathway Looking at Canada?

Dear Reader,

When the ‘Oracle of Omaha’ offers investment advice, it’s time to pay attention.

Buffett mentioned that Canada looks appealing, which means there is value for his potential investments.

So let’s put our Berkshire hat on…

The Buffet Indicator is the ratio of the total value of the stock market, relative to GDP.

This indicator can be applied to any country. Below is an example.

The Buffett Indicator posits that the stock market’s value should align with the country’s GDP. However, take note that the US stock market (the numerator) is forward-looking, reflecting future earnings.

In contrast, GDP (the denominator) is backward-looking, measuring past economic performance.

This makes the comparison somewhat mismatched, like apples to oranges.

That said, let’s put Warren’s indicator to work, since 1970.

The 'Boom and Take Off' Stage Is Already Here

By Corey McLaughlin

It's the "boom and take off stage"...

That was Crypto Capital editor Eric Wade's opening salvo during a panel discussion about the potential of artificial intelligence ("AI")...

Back in April, attendees sat in a large conference room on Maryland's Eastern Shore for Stansberry Research's quarterly "offsite" meeting.

Dozens of our editors, analysts, and other staffers gathered for the day to pitch investment ideas and discuss some of the biggest stories in the economy and the world in general.

AI is undoubtedly one of these. Excitement over AI has been building for more than a year... ever since ChatGPT took off and chipmaker Nvidia (NVDA) blew past earnings estimates, thanks to demand for its AI-related products.