The KUIK Morning Market Report for Monday, July 31:
Markets are mixed.
Index
Direction
Change
Units
Index
Time
Change
Dow Jones Industrial Average
Up
65
points
21,895
7:21 AM
S&P500
Up
0.0%
percent
2,473
0.58
Nasdaq Composite
Down
-0.2%
percent
6,364
(10.83)
30 Year Treasury
Up
2
Basis Points
2.91
Annual Yield
Federal Reserve policies and new regulations may have strengthened the financial system, but they’re making it harder for many Americans to access homeownership and gain a foothold in the middle class, according to a new paper from a Washington-based consultancy Federal Financial Analytics. The housing market now has “recovered” only for the wealthiest, cutting off the engine of wealth creation for rest of America, according to the paper’s author, Karen Shaw Petrou. The biggest culprit may be the Federal Reserve, which expanded its balance sheet to $4.5 trillion to encourage financial risk-taking. She cites a 2016 Bank for International Settlements paper that found that stocks and bonds, which are commonly held by higher-income households, have appreciated much more than homes, which are the primary assets held by lower-income Americans. It’s a double whammy that homes in the lower tier of the market have recovered less than pricier ones.
The pending home sales index from the National Association of Realtors rose 1.5% to 110.2. Economists expected only a 0.9% increase. In June, only the Midwest saw a decline, with pending sales down 0.5% for the month and 3.4% for the year. Here in the West, sales rose 2.9% in June, but are 1.1% lower than a year ago.
Serving the West Side first, I am Bill Roller of BR Capital for 1360 KUIK.
