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Economy

FHFA Revised HPI Higher for June to 1%

Real Estate Market Going Up Concept Illustration. (Photo: AdobeStock)
Real Estate Market Going Up Concept Illustration. (Photo: AdobeStock)

Washington, D.C. (PPD) — The Federal Housing Finance Agency (FHFA) House Price Index (HPI) shot up 1.0% nationally in July. House prices rose 6.5% from July 2019 to July 2020. FHFA also revised its previously reported 0.9% gain for June to 1.0%.

Forecasts ranged from a low of 0.3% to a high of 0.7%. The consensus forecast was calling for 0.6%.

For the nine census divisions, seasonally adjusted monthly house price changes from June 2020 to July 2020 ranged from +0.6% to +7.7%. The West North Central division posted on the low end of the range while the New England division came in at +2.0%. The 12-month changes ranged from +5.4% in the West South Central division to +7.7% in both the Mountain and the East South Central divisions.

“U.S. house prices posted a strong increase in July,” said Dr. Lynn Fisher, FHFA’s Deputy Director of the Division of Research and Statistics. “Between May and July 2020, national prices increased by over 2 percent, which represents the largest two-month price increase observed since the start of the index in 1991. The dramatic increase in prices this summer can be attributed to the historically low interest rate environment and rebounding housing demand even as the supply of homes for sale remains constrained.”

About the FHFA HMI

The FHFA HPI has measured changes in single-family home values based on data from all 50 states and over 400 American cities since the mid-1970s.

The FHFA HPI incorporates tens of millions of home sales and offers insights about house price fluctuations at the national, census division, state, metro area, county, ZIP code, and census tract levels. FHFA uses a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze house price transaction data.

Washington, D.C. (PPD) — The Federal Housing

Economy

Manufacturing Export Wooden Crate, reading Made in Virginia. 3D Illustration for Fifth District Manufacturing Survey for the Federal Reserve Bank of Richmond. (Photo: AdobeStock)
Manufacturing Export Wooden Crate, reading Made in Virginia. 3D Illustration for Fifth District Manufacturing Survey for the Federal Reserve Bank of Richmond. (Photo: AdobeStock)

Richmond, Va. (PPD) — The Federal Reserve Bank of Richmond Fifth District Survey of Manufacturing Composite Index hit the highest level in since September 2018. The composite index climbed from 18 in August to 21 in September, fueled by gains in new orders and employment.

Forecasts ranged from a low of 10 to a high of 16. The consensus forecast was 12.

The results reflect improvement in local business conditions and increased capital spending. Respondents were optimistic that conditions would continue to improve in the next six months.

The survey found higher employment in September and indicates several manufacturing firms in the Fifth District raised wages. However, firms struggled to find qualified workers. Respondents expected to see a continued rise in employment and wages.

Fifth District Survey of Manufacturing Composite Index

Economy

File photo: A sold sign on an existing home. (Photo: AdobeStock)
File photo: A sold sign on an existing home. (Photo: AdobeStock)

Washington, D.C. (PPD) — The National Association of Realtors (NAR) reported existing home sales in August hit the highest level since December 2006. The stronger-than-expected increase for the third consecutive month follows a record 24.7% gain in July.

Total existing-home sales — completed transactions that include single-family homes, townhomes, condominiums and co-ops — gained 2.4% to a seasonally-adjusted annual rate of 6.00 million. Sales as a whole rose year-over-year, up 10.5% from a year ago (5.43 million in August 2019).

Forecasts ranged from a low of 5,550,000 to a high of 6,440,000. The consensus forecast was 5,965,000.

“Home sales continue to amaze, and there are plenty of buyers in the pipeline ready to enter the market,” Lawrence Yun, chief economist for NAR, said. “Further gains in sales are likely for the remainder of the year, with mortgage rates hovering around 3% and with continued job recovery.”

The median existing-home price for all housing types was $310,600 in August, up 11.4% from $278,800 in August 2019. The national price increase marks 102 straight months of year-over-year gains, and prices rose in every region.

Total housing inventory totaled 1.49 million units in August, down 0.7% from July and 18.6% from one year ago (1.83 million). Unsold inventory sits at a 3.0-month supply at the current sales pace, down from 3.1 months in July and down from the 4.0-month figure recorded in August 2019.

Existing Home Sales Regional Breakdown

Existing home sales rose in every region for the third straight month and median home prices rose by double-digit rates in each of the four from one year ago.

In the Northeast, existing home sales shot 13.8% higher to annual rate of 740,000, a 5.7% gain from a year ago. The median price in the Northeast was $349,500, an increase of 10.4% from August 2019.

Existing home sales rose 1.4% in the Midwest to an annual rate of 1,410,000 in August, up 9.3% from a year ago. The median price in the Midwest was $246,300, a 10.7% increase from August 2019.

In the South, existing home sales gained 0.8% to an annual rate of 2.60 million in August, up 13.0% from the same time one year ago. The median price in the South was $269,200, an increase of 12.3% from a year ago.

Existing home sales in the West ticked higher by 0.8% to an annual rate of 1,250,000 in August, a 9.6% increase from a year ago. The median price in the West was $456,100, up 11.8% from August 2019.

Washington, D.C. (PPD) — The National Association

Economy

CFNAI Revised Higher for July, Both Headline and 3-Month Average

U.S. economy on an American flag background waving in the wind, in 3D rendering. (Photo: AdobeStock)
U.S. economy on an American flag background waving in the wind, in 3D rendering. (Photo: AdobeStock)

The Chicago Fed National Activity Index (CFNAI) indicated slower, “but still above-average growth” in August, while economic growth in July was revised significantly higher. The CFNAI came in +0.79 in August after an initially reported +1.18 in July, which was revised higher to +2.54.

Forecasts ranged from a low of 1.18 to a high of 1.95. The consensus forecast was 1.88. Two of the four broad categories of indicators made positive contributions in August, but all four fell from an upwardly revised July.

The CFNAI-MA3 — the three-month moving average for the index — moved down to +3.05 in August, from +4.23 in July. The CFNAI Diffusion Index, which is also a three-month moving average, fell to +0.62 in August from +0.73 in July.

Forty-five of the 85 individual indicators made positive contributions to the CFNAI in August, while 40 made negative contributions. Twenty-nine (29) indicators improved from July to August, while 56 indicators deteriorated. Of the indicators that improved, 11 made negative contributions.

The Chicago Fed National Activity Index (CFNAI)

Economy

People count money at Macy's Herald Square store during the early opening of the Black Friday sales in the Manhattan borough of New York, November 26, 2015. (Photo: Reuters)
People count money at Macy’s Herald Square store during the early opening of the Black Friday sales in the Manhattan borough of New York, November 26, 2015. (Photo: Reuters)

Ann Arbor, Mich. (PPD) — The Survey of Consumers preliminary reading on consumer sentiment for September ticked higher from 74.1 in August to 78.9 in September, beating the consensus forecast. Forecasts for the headline index ranged from a low of 71.5 to a high of 77.0, and the consensus forecast was 75.0.

The Current Economic Conditions Index rose from 82.9 in August to 87.5 in the preliminary for September. The Expectations Index rose to 73.3 from 68.5.

The final data release for September is scheduled for Friday, October 02, 2020 at 10:00 am EST.

The Survey of Consumers preliminary reading on

Economy

U.S. initial jobless claims graph on a tablet screen. (Photo: AdobeStock)
U.S. initial jobless claims graph on a tablet screen. (Photo: AdobeStock)

Washington, D.C. (PPD) — The U.S. Labor Department (DOL) reported initial jobless claims fell to a seasonally-adjusted 860,000 for the week ending September 12. The previous week was upwardly revised slightly by 9,000 from 893,000.

Forecasts ranged from a low of 800,000 to a high of 895,000. The consensus forecast was 850,000.

The 4-week moving average was 912,000, down 61,000 from the previous week. The previous week’s average was revised up by 2,250 from 970,750 to 973,000.

Lagging Jobless Claims Data

The advance seasonally adjusted insured unemployment rate fell to single digits for the week ending August 15 at 9.9%. It came in at 8.6% for the week ending September 5, a decline of 0.7 from the previous week, which was revised higher 0.1 to 9.3.

The insured unemployment rate hit the first high of the current crisis at 8.2% for the week ending April 4. The all-time high prior to that was 7.0%, recorded in May of 1975. On April 11, it rose to 11.0% and 12.4% on April 25.

Under the Trump Administration, this rate had fallen to an all-time low 1.1% and remained at 1.2% just weeks ago, as recently as March 14. But that was before coronavirus (COVID-19) mitigation efforts.

The advance number for seasonally adjusted insured unemployment during the week ending September 5 was 12,628,000, a decrease of 916,000 from the previous week’s revised level. The previous week’s level was revised up 159,000 from 13,385,000 to 13,544,000. The 4-week moving average was 13,489,000, a decrease of 532,750 from the previous week’s revised average. The previous week’s average was revised up by 39,750 from 13,982,000 to 14,021,750.

During the week ending August 29, Extended Benefits were available in 49 states, the District of Columbia and Puerto Rico. That’s down from all 50 a week earlier.

Those states are: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Vermont, the Virgin Islands, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.

The highest insured unemployment rates in the week ending August 29 were in Hawaii (20.3), California (17.3), Nevada (15.6), New York (15.0), Puerto Rico (14.1), Louisiana (13.6), Connecticut (11.9), Georgia (11.9), District of Columbia (11.3), and Massachusetts (11.0).

The largest increases in initial claims for the week ending September 5 were in California (+23,841), Texas (+8,618), Louisiana (+8,375), New Jersey (+2,402), and Washington (+2,173), while the largest decreases were in Kentucky (-7,219), Florida (-5,334), Pennsylvania (-2,257), Kansas (-1,915), and Michigan (-994).

Initial jobless claims fell to a seasonally-adjusted

Economy

HMI Subindexes All Post Record Highs, Economic Indicators Suggest Historic Housing Boom

Builder confidence and residential construction, hew homes, housing starts, building permits, depicted on blueprints. (Photo: AdobeStock)
Builder confidence and residential construction, hew homes, housing starts, building permits, depicted on blueprints. (Photo: AdobeStock)

Washington, D.C. (PPD) — The NAHB Housing Market Index (HMI) reported builder confidence unexpectedly rose another 5 points to 83 in September, smashing the all-time high and beating the consensus forecast. A reading above 50 indicates a positive housing market for new single-family dwellings.

Forecasts ranged from a low 75 to a high of 81. The consensus forecast was 78, indicating the surge was far stronger than economists expected. The HMI now stands at its highest reading in the 35-year history of the series, matching the record that set back in December 1998.

“Historic traffic numbers have builders seeing positive market conditions, but many in the industry are worried about rising costs and delays for building materials, especially lumber,” said NAHB Chairman Chuck Fowke. “More domestic lumber production or tariff relief is needed to avoid a slowdown in the market in the coming months.”

The HMI started 2020 at a 20-year high. In January, builder confidence in the market for newly-built single-family homes edged just one point lower to 75 from December 2019. The two monthly readings had marked the highest sentiment levels since July of 1999.

The NAHB/Wells Fargo HMI is derived from a monthly survey that NAHB has been conducting for 30 years. It measures builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.”

HMI Subindices

Each of the HMI subindices posted all-time record high readings in September. The HMI index for current sales conditions rose four points to 88. The index for sales expectations in the next six months gained six points to 84 and the measure charting traffic of prospective buyers saw a nine-point gain to 73.

Regional HMI 3-Month Averages

The three-month moving averages for regional HMI scores show Northeast gained 11 points to 76, the Midwest rose nine points to 72, the South gained 8 points to 79 and the West rose seven points to 85.

Housing Primed to Lead Economic Recovery

As People’s Pundit Daily (PPD) recently reported, indicators widely show the U.S. housing market is “booming”, surpassing pre-pandemic levels and expectations. Experts now foresee housing leading the economic recovery and have raised growth forecasts for the sector.

The National Association of Realtors (NAR) reported existing home sales posted another record gain in July. The key housing market indicator rose 24.7% to a seasonally-adjusted annual rate of 5.86 million, surpassing the previous record set in June.

The Pending Home Sales Index (PHSI) surged more than three times the consensus forecast by 16.6% in June, after soaring a record 44.3% in May. The PHSI rose another 5.9% in July.

New residential construction statistics for housing starts and building permits skyrocketed in July, despite lingering effects due to coronavirus (COVID-19). The former gained 22.6% (±14.7%) and the latter 18.8% (±1.1%), respectively.

The report for August is scheduled to be released on Thursday.

New home sales soared 13.8% (±17.8%) to a seasonally adjusted annual rate of 776,000 in June, easily beating the consensus forecast. That’s the highest level for new home sales since before the Great Recession, or July 2007.

Builder confidence unexpectedly rose another 5 points

Economy

Group of friends sitting outdoors with shopping bags; several people holding smartphones and tablets. (Photo: AdobeStock/ OneInchPunch/PPD)
Group of friends sitting outdoors with shopping bags; several people holding smartphones and tablets. (Photo: AdobeStock/ OneInchPunch/PPD)

Washington, D.C. (PPD) — The U.S. Census Bureau reported advance retail sales came in at $537.5 billion in August, a 0.6% (± 0.5%) gain that missed the consensus forecast. That’s 2.6% (± 0.7%) above August 2019 and total sales for the June 2020 through August 2020 period are now up 2.4 (± 0.5%) from the same period a year ago.

Forecasts ranged from a low of 0.2% to a high of 2.5%. The consensus forecast was 1.0%.

The prior month was revised down slightly from a gain of 1.2% to 0.9%. The June 2020 to July 2020 change was revised from a gain of 1.2% (± 0.5%) to a gain of 0.9% (± 0.2%).

Retail trade sales are up 0.1% (± 0.5%) from July 2020, and 5.1% (± 0.7%) year-over-year. Nonstore retailers are up 22.4% (± 1.4%) from August 2019.

Advance retail sales rose 0.6% (± 0.5%)

Economy

Manufacturing Firms in Second District Very Optimistic About the Future, Capital Expenditures Index Hits Multi-Month High

Manufacturing Export Wooden Crate, reading Made in New York. 3D Illustration. (Photo: AdobeStock)
Manufacturing Export Wooden Crate, reading Made in New York. 3D Illustration. (Photo: AdobeStock)

New York, N.Y. (PPD) — The Federal Reserve Bank of New York Empire State Manufacturing Survey rebounded strongly in September, nearly tripling the consensus forecast. The headline general business conditions index climbed thirteen points to 17.0, the third straight positive reading.

Forecasts for the headline index ranged from a low of 2.0 to a high of 15.0. The consensus forecast was 6.5.

Forty percent (40%) of respondents reported conditions had improved over the month, while 23% reported that conditions had worsened. The new orders index rose nine points to 7.1 and the shipments index by seven points to 14.1, suggesting a significant increase in shipments.

The index for future business conditions gained six points to 40.3, indicating firms are very optimistic about the future, more-so than last month. With the exception of the post-pandemic shutdown surge to 56.5 in June, it’s the highest level for expectations since 43.1 in March 2018.

The capital expenditures index shot thirteen points higher to 18.7, the highest level in several months. The reading signals that firms plan to increase capital spending.

The Federal Reserve Bank of New York

Elections

Despite Hedging, Democrats Are Now the Party of Wall Street in Trump Era

Graphic concept taking a magnifying glass to Wall Street. (Photo: AdobeStock)
Graphic concept taking a magnifying glass to Wall Street. (Photo: AdobeStock)

Wall Street donations have shifted significantly over the last two cycles. While the securities and finance industry still hedges on campaign contributions, Democrats have decidedly become the party of Wall Street in the era of Donald Trump.

The Republican Party, long branded as the party of big business, is no longer the top recipient of campaign contributions from Wall Street. In 2018, the industry donated more to Democrats than Republicans for the first time in a decade.

In 2018, Democratic candidates and political action committees (PACs) received $66,671,595 in Wall Street campaign contributions, or roughly 62% of the total $107,565,737. Republicans received $40,531,178, or roughly 37.7% of total in donations from the securities and finance industry.

That’s the largest disparity between the parties for a midterm election cycle over the 30-year period researched by People’s Pundit Daily (PPD). The last time Democrats outpaced Republicans on Wall Street donations was in 2008, when George W. Bush relied on his political opposition to pass the Troubled Asset Relief Program (TARP).

The data compiled by the Center for Responsive Politics cover Wall Street donations dating from 1990 to 2020 released by the Federal Election Commission (FEC) as of Friday, August 21, 2020. The figures are based on contributions from PACs and individuals who gave ≥ $200.

In 2016, Hillary Clinton received more than 80% of the total contributions from the securities and finance industry. That compares to the paltry 19% contributed to then-Republican nominee Donald Trump. This disparity continues in the era of Donald Trump.

In 2020, former Vice President Joe Biden received $4,914,998 in Wall Street donations by August 21, compared to $1,450,233 for President Trump. Mark Kelly, D-Ariz., the nominee for U.S. Senate in a tough race against Senator Martha McSally, R-Ariz., was the third top recipient at $1,403,766. Of the top 10, only three are Republican recipients juxtaposed to seven Democratic recipients.

Former Vice President Joe Biden is also the top recipient for contributions from hedge funds ($498,489), finance and credit companies ($252,087), private equity and investments firms ($1,400,892), savings and loans ($22,634) and venture capital ($859,206).

While the securities and finance industry still

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