Good Tuesday AM,

Tech stocks (and Crypto) doing ok today, other equities and bonds are taking a hit. The 10-yr is backing up to 2.71% from 2.58 yesterday. Not really much news. Central bank of Australia raised their lending rate by .50 and the job opening report showed less turnover. The bigger movers were likely commentary from two Fed presidents, Daly and Evans who both indicated more rate hikes were to come. I suspect bonds will settle down here soon.

A few quick hits from the industry…

I know I’ve been beating this drum but I thought I would share the message from another source.. Longer-term interest rates, which mortgage rates are reflective of, are influenced by the prospects of future economic growth,” said Len Kiefer, deputy chief economist at Freddie Mac. “If the economy were to weaken, which market participants expect, that typically leads to lower interest rates despite what may be happening to short-term rates like the Fed’s policy rate.”

As global economies flash recession signals, cracks are forming in housing markets that surged in the first years of the pandemic. In New Zealand, which has been the world’s frothiest real estate market, prices are plunging and homes are sitting on the market for longer. This is a possible sign of what’s to come in other places as central banks fight inflation and consumers get squeezed by higher prices.

It’s a similar story in Canada, another market that’s run hot for two years. Bidding wars are waning as sellers scramble to navigate a sudden downturn. And in the US, some Americans priced out of the domestic market are looking to another continent for their home purchases. Despite the turmoil, and fears that prices will plunge if or when a recession hits, Brits have kept buying real estate at high prices. Never mind the climbing mortgage costs. The US has the advantages of a strong currency and an undersupply of housing.

And… have we taught our kids about financial responsibility? 

😭 MILLENNIAL DEBT STATISTICS

• Among millennials who are debt-free, just 1 in 3 (34%) have never had debt, while 1 in 4 (25%) have paid off their debts within the past year.
• Nearly three-fourths of millennials (72%) have some form of non-mortgage debt, with the average millennial owing $117,000.
• About 63% of millennials believe it will take them one to five years to pay off their debt, while nearly 1 in 10 think it will take more than 10 years.
• Approximately 1 in 16 millennials (6%) don’t think they’ll ever pay off their debt.
• The most common type of debt among millennials is credit card debt, with 67% of those with debt carrying a balance.
• Nearly 1 in 3 millennials (29%) don’t pay off their credit card bill in full every month.
• Of those who have credit card debt, the average amount they owe is $5,349.
• Nearly half of millennials with debt (48%) say they have student loans, with the average respondent owing $126,993.
• The average millennial spends 47% of gross monthly income on housing each month — 1.5x more than the recommended 30%.
• More than half of millennials (53%) own a home, but 1 in 6 millennial homeowners (16%) regret their purchase.
• Of those who don’t own a home, nearly 1 in 3 (30%) don’t think they’ll ever be able to afford one.
• Not saving enough is the No. 1 financial regret among millennials (37%).
• One-fourth of millennials (25%) aren’t confident they could afford a $500 emergency expense out of pocket. One-third (33%) don’t think they could afford a $1,000 emergency.
• About 77% of millennials already have children or want them in the future, but 1 in 4 (25%) say they can’t afford them.

Please remain safe and healthy, make today great.