Alan Greenspan; Gresham’s Law and why the US dollar is so strong

I just came across this insightful blog post regarding Gresham’s law and how it currently applies to the US dollar. Interestingly enough it was written by Alan Greenspan, former Federal Reserve Chairman.

I thought it would be proper to devote a separate blog post to Dr. Greenspan’s thoughts regarding Gresham’s law and the dollar, because I have received a couple of recent emails asking me to explain why I thought the US dollar was in such high demand. Moreover, a commenter on a recent post asked why I thought certain fiat currencies wouldn’t “collapse”. Greenspan’s ideas go a long way in explaining my sentiment.

As Greenspan wrote in his post,

Gresham’s law is a monetary principle named after Sir Thomas Gresham. It is colloquially simplified to “bad money drives out good”.

Further down in the article, Greenspan explains how Gresham’s law can also apply to fiat currencies.

When the U.S. dollar was first anointed the world’s reserve currency by the Bretton Woods Agreement in 1944, it was fully backed by gold. Now that the global financial system has transitioned fully to fiat currencies, examples of Gresham’s law in its traditional formulation are rare. No longer are there difference in intrinsic (commodity) value causing one currency to be favored over another. However, foreign exchange rates do reflect some of the forces Gresham originally recognized at work. The present strength in the U.S. dollar in relation to the other traditional reserve currencies is one example of market participants choosing to hoard what they view as “good money” – or at least better money.

Gresham’s Law, Alan Greenspan, November 2, 2022

Below, I am going to include the entire unedited text of Alan Greenspan’s blog post, because I believe it provides a very succinct explanation of why I have found the dollar to be the currency of choice over all other fiat currencies. Keep in mind, my conclusions on why the dollar is king only applies to the Post-QE world. I would not be able to make these same assumptions before the advent of QE in 2008.

I also see other reasons as to why the dollar is remaining firm. Two other forces that I can think of are also at play; first, the United States is the world’s largest energy producer, and given the current geopolitical state of affairs, the US is seeing great demand for its energy products. Second, in the post-QE world, the world is consuming much more credit than the world could typically service, and with the dollar as the de facto reserve, any economic and financial stress would impose a premium on the greenback as borrowers chase to obtain the needed dollars to service outstanding debt. In other words, any financial stress magnifies the value of the dollar.

Gresham’s Law
November 2, 2022

By Dr. Alan Greenspan, Senior Economic Advisor

Gresham’s law is a monetary principle named after Sir Thomas Gresham. It is colloquially simplified to “bad money drives out good”. This was the jest of the argument Sir Gresham presented to Queen Elizabeth I to explain the poor state of England’s coinage following the “Great Debasement” under King Henry VIII. During this period, the purity of gold and silver coins produced by the English mint steadily declined by order of the Crown in an attempt to increase revenues. Once the lower purity of the new (bad) coins was discovered, the old (good) coins of higher purity disappeared from circulation as people chose to spend the lower quality coins in market transactions and hoard the higher quality coins as a store of value – bad money had driven out the good. By the time Queen Elizabeth I ascended to the throne, the secret was out and even foreign merchants were refusing to accept payment in the debased currency.

A similar response to currency debasement was observed in the United States some four hundred years later. In response to a shortage of coins coupled with depleted government silver stocks, the Coinage Act of 1965 reduced the silver content of the U.S. half-dollar coin from 90% to 40%. In accordance with Gresham’s law, the higher purity coins quickly disappeared from circulation. Furthermore, when the price of silver subsequently reached a level at which the silver content in the 40% coin was worth more than their nominal 50-cent face value, those coins disappeared from circulation as well and the U.S. mint abandoned including any silver in half-dollar coins shortly thereafter. Even the lower quality 40% half-dollars had been driven out by worse money – Federal Reserve Notes.

When the U.S. dollar was first anointed the world’s reserve currency by the Bretton Woods Agreement in 1944, it was fully backed by gold. Now that the global financial system has transitioned fully to fiat currencies, examples of Gresham’s law in its traditional formulation are rare. No longer are there difference in intrinsic (commodity) value causing one currency to be favored over another. However, foreign exchange rates do reflect some of the forces Gresham originally recognized at work. The present strength in the U.S. dollar in relation to the other traditional reserve currencies is one example of market participants choosing to hoard what they view as “good money” – or at least better money.

Through the prism of Gresham’s law, the strength in the dollar is largely the result of drastically diverging monetary policies. The Federal Reserve has embarked on an expedited rate hike schedule, and this alone would tend to produce a strengthening in the dollar. However, the Fed’s actions are even more dramatic when you look at what the central banks of the other reserve currencies are doing. The Bank of Japan has committed to maintaining ultra-low rates – their target short-term rate is negative at the moment and the target rate on their 10yr bonds is 0%. Europe is also behind the U.S. with respect to the tightening cycle having just brought their target rate to neutral in July and now sitting at a meager 1.5%. By comparison, the Federal Reserve is expected to raise their target rate to 4% at this week’s meeting of the Federal Open Market Committee (FOMC). The Federal Reserve’s commitment to tamping down inflation has convinced markets that the value of their dollar holdings will not be inflated away as quickly as compared to these other reserve currencies and U.S. dollar strength is a symptom of market participants choosing to hoard the “good money”.

Even if, as some prognosticators expect, U.S. inflation crests in the first half of 2023 and the Federal Reserve can slow or even stop the pace of rate increases, the U.S. dollar will still have a monetary tailwind to support it. Indeed, the elephant in the room with respect to continued strength in the U.S. dollar going forward may turn out to be the $95 billion per month reduction in the Federal Reserve’s balance sheet. By contrast, the European Central Bank (ECB), who also has a near-$9 trillion balance sheet, recently indicated it has no plans to begin reducing its holdings. Meanwhile in London, former prime minister Liz Truss’ belated fiscal plan shocked markets so much that the Bank of England had to step in and buy government bonds to preserve financial market stability – they are essentially engaging in quantitative easing as the U.S. is tightening. The fact that the supply of U.S. dollars can be expected to steadily decrease makes it a better store of value – that the pound sterling and euro are both flirting with dollar parity is a clear example of investors dumping “bad money”.

To be sure, other factors are also at play. War in Ukraine and the massive uncertainty that it continues to generate in energy and other commodity markets, not to mention geopolitics, is supportive of a the safe-haven dollar. But even if this exogenous shock were to be resolved, the divergences in monetary policy would cause dollar strength to persist for some time. Furthermore, investors should be aware that while dollar strength can be a symptom of economic stresses, it can also be a cause. As the global reserve currency, many of the world’s most important commodities are priced in dollars – in particular energy. Strength in the dollar has made the natural gas Europe so desperately needs that much more expensive. Emerging market economies that rely on imports of dollar-denominated commodities or hold dollar-denominated debt would experience an influx of inflation coupled with rising debt service costs. Absent price increases in their foreign markets, U.S. multinational corporations would experience deflated overseas earnings as the dollar value of foreign sales would shrink with a rising dollar. Take heed, Gresham’s law can wreak havoc on currencies, and the underlying economies will eventually feel the consequences.

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53 thoughts on “Alan Greenspan; Gresham’s Law and why the US dollar is so strong

  1. I am looking to buy new construction with my next rental purchase. With a 6 cap and everything new, why not?.

    Homebuilders struggle to find buyers as cancellations by developers rise: ‘The build-for-rent market is going to become increasingly important’

    Some builders are offloading inventory to institutions, who in turn put the units on the rental market. “The build-for-rent market is going to become increasingly important,” he said. While it won’t overtake the build-for-sale market, it “does broaden the pool of buyers.”

    Homebuilder stocks are trading at a fraction of book value, Lovallo said, at about five times earnings.

    Homebuilding is ripe for disruption

    It’s time homebuilders explored some innovation, Lovallo told MarketWatch. “Fewer homes were built over the past 14 years” since the 2008 recession, he said. “And the ones that were built were built at higher price points, because that’s where the demand was.”

    “The homebuilding industry is still building homes today the same way they did 100 years ago. They’re stick framing homes on site, lumber is being tossed around,” Lovallo explained. “It’s probably the only industry that has not seen technology infused over the past 100 years.”

    Constraints on labor, and bureaucratic red tape with land and permits all bog down the process of homebuilding, he added.

    “There has to be some kind of change that’s brought to this industry,” Lovallo said. “But I would argue that 10 years from now, we’re going to be building homes very differently than we are today.”

    Even though builders are seeing cancellations rise, don’t expect home prices to drop significantly, Lovallo advised.

  2. I often hear about how people hate Western culture. But I tell them Western culture is already dead. The current culture in the West and rest of the world is now something I would consider as a type of multicultural, self-absorbed, egosyntonic , gang-banging Babylonian culture.

    The culture of my childhood no longer exists. It’s been replaced with a CIA and DARPA creation. If you think all the races and peoples can live together in harmony, you should embrace this culture. It’s the type of culture a sociologist would observe in a medium security prison.

    The multiculturalists have rejected the Western traditions, so what do they want? They don’t even know. Their adversary controls their present, so their adversary controls their past.

    1. Ironically, SCI is the only true funeral and cemetery stock that is done well. I look at CSV and that has not done nearly as well.

      While I certainly would not be investing in any life insurance stocks as the actuarial assumptions are worsening and interest rates are not helping, I wouldn’t be going gangbusters on the funeral stocks either, though SCI has done phenomenally well.

  3. I read somewhere that someone was pointing out the differences between adolescents in the United States versus Chicomm China, and how China was pulling ahead of the United States.

    The writer stated that the number one endeavor for American youth was to be a social influencer, while in China it was to be an astronaut. I view both endeavors to be delusional.

    Obviously, in being a social influencer, one has to be sociopathic in nature, and it’s all about getting over on people.

    Now it might be a noble aspiration to be an astronaut, but that is one dead profession, since humans cannot leave lower Earth orbit and have never journeyed even close to the Moon, let alone landing on it and flying back home safely.

    The youth of both Nations have become very delusional.

    1. When has any youth ever not been delusional? Were those flower power boomers highly lucid? Doubt that very much.

      1. You must be young. My last vax was in 1979.

        Look at photos of children from 1970 and compare them to those of today. Two different species.

        children have been engineered to believe this

        They sell this milk at the local Whole Foods. The young folk believe it.

        The children have been engineered to believe the big lie. And the parents send them off to be cursed in the indoctrination camps called schools.

  4. I don’t know about you, but I am looking to buy another SFR. Getting my ducks in a row. 🦆🦆🦆🦆
    WASHINGTON, DC – The Fannie Mae (FNMA/OTCQB) Home Purchase Sentiment Index® (HPSI) decreased 4.1 points in October to 56.7, its eighth consecutive monthly decline and lowest reading since the inception of the index in 2011.

    Press Release
    Consumer Confidence in Housing Hits New All-Time Low
    November 7, 2022

    WASHINGTON, DC – The Fannie Mae (FNMA/OTCQB) Home Purchase Sentiment Index® (HPSI) decreased 4.1 points in October to 56.7, its eighth consecutive monthly decline and lowest reading since the inception of the index in 2011. Five of the six index components decreased month over month, including those associated with home buying and selling conditions, as persistently high home prices and unfavorable mortgage rates continue to fuel consumers’ housing affordability concerns. Only 16% of respondents indicated that now is a good time to buy a home – a new survey low – while the percentage who believe now is a good time to sell a home decreased sharply from 59% to 51% in October. Year over year, the full index is down 18.8 points.

    “The HPSI reached an all-time survey low this month, in line with expectations that the housing market will continue to cool in the months ahead,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. “Consumers are increasingly pessimistic about both homebuying and home-selling conditions. Amid persistently high home prices and unfavorable mortgage rates, the ‘bad time to buy’ component increased to a new survey high this month, while the ‘good time to sell’ component continued its downward trend. Consumers also remain concerned about the movement of home prices – expectations that prices will decrease reached a new survey high, particularly among homeowners – offering further support to our forecast of home price declines in 2023. As continued affordability constraints reduce homebuyer demand, and homeowners become reluctant to sell at potentially reduced prices, we expect home sales to slow even further in the coming months, consistent with our forecast.”

  5. Homeowners have lost $1.5 trillion in equity since May, as home prices drop

    PUBLISHED MON, NOV 7 20221:43 PM EST
    Diana Olick

    •Homeowner equity peaked at $11.5 trillion collectively last May, after home prices jumped 45% since the start of the pandemic.
    •In September, home prices fell on a month-to-month basis for the third month in a row.
    •Since July, the median home price has dropped by $11,560.

  6. The link below provides some interesting analysis that is even worse than I thought regarding making ends meet in a world that is ruled by our adversary.

    This is what happens when the Christian Church tells you that the OT was nailed to a cross. Pastor Lawson will tell you that God loves everybody, and this will allow the enemy to walk right on in unopposed. The enemy who will pose as our friends will tell us that everyone is the same. Indeed, our adversary is correct; we’re all the same debt slaves and there’s no going back.

    This is the way it works in the multicultural Kingdom of iron and clay. You can make a fuss and you can argue and you can fight, but at the end of the day, the people are just dumbass stupid laodicean debt slaves. This includes the Paul-quoting Christians in the laodicean church.

    There is a collapse going on. Just look out your window and view the multicultural Kingdom that has overwhelmed the native population. It is a collapse of Western Civilization, but most laodiceans today prefer it that way.

    New Study: 60% of US Consumers Have Cut Spending Due to Inflation

    For “New Reality Check: The Paycheck-To-Paycheck Report,” a collaboration with LendingClub, PYMNTS surveyed 3,495 US consumers to explore how inflation has impacted consumer spending. Among our findings: 55% have limited spending capacity, 49% have shifted their shopping preferences, and 66% of those living paycheck to paycheck have cut spending, with notable differences reported among rural and urban consumers.

    Inside the September Report
    28%: Share of consumers earning more than $200,000 who live paycheck to paycheck
    59%: Share of paycheck-to-paycheck consumers with issues paying their monthly bills that noted significant rises in prices for utilities in the past 12 months
    48%: Share of consumers living paycheck to paycheck with issues paying bills who pay for health insurance

      1. PEP pedals poison in all of its products. But the heathen love them. Just look at the 20-year monthly chart on PepsiCo.

        The heathen will be sleeping on the stairwells, but they’ll be drinking their Pepsi and eating their Doritos.

        1. Look at MDLZ. The people can eat their Oreos and Ritz crackers, and drink their Tang, and then can complain at the high cost of healthcare.

          I say we buy MDLZ instead and skip eating their garbage and going to the doctors.

          1. Looks like Brave New World happiness-producing drug Soma in food and junky beverages.

            Many with these habits end being obese and diabetics by their early fifties. I have a close friend like that. Then they go to the doctors and they give them insulin and opioids for the many complications too much sugar in the body produces as we age.

            Then you got it: addictive junk food first and addictive doctorś prescribed powerful drugs later, like insulin and heroin derived, opioids.

            My friend is being with insulin and opioids for few years and has changed a lot to the worse. Now he is in benefits and is incapable of work.

            No doctor ever will tell him or anyone to change his diet and loose weight in order to be more healthy to improve his diabetics and too much sugar induced joint problems and mood swings. No. They do no want this. People capable of looking for themselves?…

            Instead, they want soft, compliant and happy masses and care not if they are utterly wrecked or sick.

            Definitely no one that sees the reality of things should underestimate our adversary, they are way too clever and evil, their power reaching all the corners of this world. I am writing from Western South Europe and here we live in the same crappy talmudian evil system.

            1. You sound like me when I talk to my friends or strangers on the street. What few I have left. When we see things the way they really are, it’s hard not to keep from talking about it.

              I laugh when I hear Christians tell me that I’m too angry and that we are supposed to love everybody. That’s why all this stuff goes on. Our adversary walks right on in the front door, completely unopposed.

    1. Many in the church today think they are exempt from Jacob’s trouble. They think that Israel and the church are separate. But Paul says in Romans 11:11-24 that Gentiles are grafted in with Israel due to their belief of Christ and to make Israel jealous; and thus perhaps save some of them. But the root that supports both olive trees – Israel and Gentile – is Christ. And as Israel can be broken off — so can a Gentile if they become proud. So even if you’re not part of the 12 tribes of Israel ‘physically,’ you still become part of them spiritually based on Romans 11.

      1. What I discuss is about eschatology and not about being saved. The two are separate.

        The misuse of the name Israel in these last days is stunning. The SoS set it up that way.

    2. You sound like the old writer and site moderator, only more pointed. Are you using a pseudonym?

  7. From Seeking Alpha (originally dropped me from their website, because of my worldview, but have since reinstated it).


    Backlash against Coca-Cola (NYSE:KO), one of the planet’s biggest users of plastic, erupted as soon as the multinational announced that it would sponsor the COP27. While the company has pointed to its signing of a global treaty meant to tackle plastic waste through a “holistic, circular economy approach,” as well as plans to collect and recycle a bottle or can for every one it sells by 2030, many say the policies are misleading and fall way short. Coca-Cola currently produces 120B single-use bottles per year, resulting in 3.3M tons of plastic packaging (its plastic use even rose by 8.1% between 2019 and 2021).

    Look at the increase in plastic usage. That’s the sign of a strong company. Take a look at the 20-year monthly chart of this Dow stock. Excellent performance with a 3% dividend yield. Think of their spinoffs over the years like CMG, etc., and it’s no wonder why Buffett owns it.

    KO makes food that acts like drugs in the body. The DJIA is looking fantastic, despite higher interest rates. Buy firms that can pass along inflation. Even demoralized and homeless Israelites who listen to erroneous OT hermeneutics from the SoS will buy KO and MCD products. Many people have sold their birthrights for a can of Coke and McDonald’s fries.

    But the alt-financial media is telling me that everything is collapsing. Perhaps in their worlds, but they’re out there feeding the beast like everyone else.

    1. I got to asked about real estate and why Warren Buffett doesn’t invest in rentals. The answer is very simple. You and I can spot a lot of profitable opportunities with a few hundred thousand dollars, but Buffett needs to find a profitable opportunity with at least several hundred million to at least a billion dollars. In order to invest, he needs a larger scale deployment of his cash.

      There is very little opportunity in SFRs at that scale. His yield would be substantially less than investing in other asset classes, especially in stocks. Apartment REITs offer lower opportunities, too, and I rarely invest in any REITs as a rule.

      But just because Buffett doesn’t invest in single-family rentals doesn’t mean we shouldn’t. Even paying up for my latest property I still bought below 15% of fair market value and all I needed to do was throw in a bunch of recessed light circuits and put in some vinyl plank floor.

        1. He only manufactures the mobile homes. But that whole segment is one huge money maker. Ask any mobile park owner.

          I have talked to mobile park owners who run extensive rent to own programs for their tenants, and these owners end up selling the same mobile home up to a dozen times. The tenants are too unstable to follow through with their obligations and end up giving the mobile home back to the owner.

      1. Charlie Munger has spoken about apartments he owns… but I think that’s separate from Berkshire

        1. Direst ownership? That’s the way to go, but for Buffett, direct ownership is not worth the hassle. He would have to buy entire skyscrapers.

          It’s always a trite response, but it has merit; whenever I hear of someone coming into a lot of cash, like an actor getting $20 million, I say to take half and buy an apartment building. I do not know of anyone who goes broke investing in apartment buildings. Easy and someone else can manage it. The accountant cuts a check every month an sends it out.

          Karen and Richard Carpenter took some of their music earnings in the 1970s and bought a few apartment buildings. I recently saw them on YouTube and they looked great. Of course, they don’t own them anymore, but perhaps Richard wished he did.

    2. I thought it was supposed to be a catastrophe for AAPL today. It ended up higher. When the public becomes addicted to a firm’s products, the firm will always make money. That’s why it’s in the Dow Jones industrials.

      I’s gots what’s you need. Stare at those screens.

        1. millionaires many times over. I say we buy a burner phone, skip the iphone and buy AAPL instead.

  8. When the large food companies put chemicals in their foods to essentially make them addictive, the people will continue paying up for their drug of choice; snack foods.

    Food prices keep rising. Food-company execs are betting Americans will keep paying.

    While analysts expect demand for Mondelez to take a hit next year, they also note that, essentially, people still like their snacks.

    Increasing grocery prices could affect demand in Europe, where consumers seem to be cutting back, but analysts think U.S. consumers will continue to buy snacks and other products

  9. Just some simple stuff here. An article you can read with your hair on fire and understand its contents. Stuff people don’t need will suffer in value, yet this author says that three things; carefully placed real estate, wine, and farmland are great hedges against inflation.

    Between 1992 and 2020, U.S. farmland returned an average of 11% per year. Over the same time frame, the S&P 500 returned only 8% annually.

  10. Holy smokes! MarketWatch says the economists are mystified, but we’re not. We know what’s causing the shortfall of at least 2 million workers. It’s the jabs. They can’t say anything or they would all lose their jobs.


    A U.S. labor shortage is planting the seeds for lots of layoffs. Here’s how

    Why are there so few workers for so many open jobs? It’s one of the biggest mysteries about the U.S. economy and helps explain why a big labor shortage is adding to high inflation.

  11. US Commercial-Property Prices Slide 13% From Peak as Rates Jump

    US commercial real estate prices have plunged 13% from a peak this year, the biggest drop since the global financial crisis, as rising interest rates cut into property values.

    Shopping malls have taken the biggest hit, with prices sliding 23% from their recent peak, according to Green Street’s October price index. Apartments and warehouses followed, each tumbling 17%. Office prices are down 14%.

    For all commercial-property types, the decline was the biggest since the 2008 financial crisis, when prices plummeted about 35%, according to Peter Rothemund, a researcher at the real estate analytics firm. In October alone, prices fell 7%.

  12. Fed released its semiannual Financial Stability Report released Friday.

    Fed Sees Risk of Big Declines in Still-Lofty US House Prices

    It also cited “strained” liquidity conditions in the Treasury and some other crucial financial markets; elevated leverage at hedge funds; and high commercial real estate prices when compared with market fundamentals.

    The Federal Reserve suggested on Friday that lofty home prices could be susceptible to steep declines after big run-ups in recent years on the back of ultra-low interest rates.

    “With valuations at high levels, house prices could be particularly sensitive to shocks,” the Fed said in its semiannual Financial Stability Report released Friday.

    Though housing price increases have slowed recently as the Fed has raised interest rates, valuations remain stretched when compared with such metrics as rents, the central bank said. It also cited “strained” liquidity conditions in the Treasury and some other crucial financial markets; elevated leverage at hedge funds; and high commercial real estate prices when compared with market fundamentals.

    The report includes a lengthy discussion on liquidity in financial markets. While saying that the Treasury market has continued to function smoothly, the Fed said liquidity is less resilient than usual. It blamed that mainly on elevated interest-rate volatility stemming from the uncertain economic outlook.

    Trading conditions in the nearly $24 trillion Treasury market have at times been difficult after a year of steep losses for bonds, driven by rising inflation, higher Fed interest rates and a reduction in the central bank’s balance sheet.

    Some market participants have warned that the loss of liquidity risks a repeat of the sort of money market turmoil seen in September 2019, when the Fed was forced to flood the banking system with cash to prevent the damage from spreading.

  13. STATE OF FREIGHT – There’s a major shift underway in manufacturing for U.S. companies

    •More than half of U.S. companies surveyed by SAP say that supply chain issues will persist in 2023.
    •Even if inflation declines, the new “just in case” model of sourcing, carrying more inventory and often use of non-•Chinese manufacturing located closer to home, will result in higher costs.
    Less hiring and lower wages are top ways the majority of companies say they plan to recoup the lost business margin.

    The supply chain may be getting better, but the challenges aren’t going away.

    That’s according to a new survey from SAP, which finds more than half (51%) of U.S. companies expecting the supply chain to remain challenging into 2023.

    The findings from the German software giant, the global leader in supply chain software with approximately 23% market share, according to Cowen, paints a picture of a supply chain that will remain in rapid flux for the U.S. economy.

  14. Most white people see the obvious. White people accounted for 88% of single family home purchases.

    Home buyers are looking older — and whiter

    The share of first-time home buyers hit an all-time low, while white Americans accounted for 88% of buyers in a 12-month survey period.

    The share of first-time buyers in the market hit an all-time low during a survey period from July 2021 through June 2022, according to the National Association of Realtors (NAR), dropping from 34% last year to 26%. (The NAR has been publishing its annual report since 1981.)

    At the same time, buyers also grew older and whiter, the NAR said, with the ages of both first-time buyers and repeat buyers reaching new highs of 36 years old and 59 years old, respectively.

    And Black Americans, who were already facing a racial homeownership gap so severe that it surpassed the disparity between Black and white homeownership seen in 1960, comprised the second-smallest share of buyers at 3%. Asians, meanwhile, accounted for just 2% of buyers, though the share of Hispanic buyers gained slightly from 7% in 2021 to 8% in the survey period.

    White people otherwise made up the vast majority of buyers at 88%, up from 82% a year ago.

    1. The big plan to drive up house prices is to discourage first time homebuyers from settling down and having kids. Most first time homebuyers are young couples looking to settle down and start a family. Homeownership is the hallmark of middle class America.Satan wants to destroy families and destroy humanity by making ownership impossible. Homeownership allows people to build a foundation for a stable and better life. Satan thrives on instability as he uses that to control humanity and therefore take control of everything.

      1. Gold whale spotted today. Right after that Bloomberg article discussing a sovereign gold whale is anonymously scooping up billion, good responded nicely today.

        Been busy rehabbing my current purchase.

  15. Manufacturing jobs blow through expectations with a rise of 32k versus a consensus of 15K. Last month’s manufacturing jobs were even revised up 1K to 23k.

    1. The civilian labor force dropped again last month to 164,667 thousand from September’s 164,689 thousand. So jobs increase 261k, yet the labor force contracts by 22k. I wonder why? Hmmm…..

      This shows up in a slightly lower participation rate of 62.2% versus 62.3% for September. With this said, I’m trying to figure out why the unemployment rate rose to 3.7%.

      1. I have my answer here to that question. Here is a verbatim from the DOL’s employment situation press release. Indeed the household survey showed a loss of 306k employed people. The household survey data is used to determine the unemployment rate. There is a huge disparity between the establishment and household data for October.

        Household Survey Data

        The unemployment rate increased by 0.2 percentage point to 3.7 percent in October, and the number of unemployed persons rose by 306,000 to 6.1 million. The unemployment rate has been in a narrow range of 3.5 percent to 3.7 percent since March.

        Among the major worker groups, the unemployment rates for adult women (3.4 percent) and Whites (3.2 percent) rose in October. The jobless rates for adult men (3.3 percent), teenagers (11.0 percent), Blacks (5.9 percent), Asians (2.9 percent), and Hispanics (4.2 percent) showed little
        or no change over the month.

        Among the unemployed, the number of permanent job losers changed little at 1.2 million in October, and the number of persons on temporary layoff also changed little at 847,000.

        The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 1.2 million in October. The long-term unemployed accounted for 19.5 percent of all unemployed persons.

        The labor force participation rate, at 62.2 percent, and the employment-population ratio, at 60.0 percent, were about unchanged in October and have shown little net change since early this year. These measures are 1.2 percentage points below their values in February 2020, prior to the coronavirus (COVID-19) pandemic.

        The number of persons employed part time for economic reasons was little changed at 3.7 million in October. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.

        The number of persons not in the labor force who currently want a job was little changed at 5.7 million in October and remains above its February 2020 level of 5.0 million. These individuals were not counted as unemployed because they were not actively looking for work during the 4 weeks preceding the survey or were unavailable to take a job.

        Among those not in the labor force who wanted a job, the number of persons marginally attached to the labor force was little changed in October at 1.5 million. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months but had not looked for work in the 4 weeks preceding the survey. The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, decreased by 114,000 to 371,000 in October.

      2. Looks like we just recently eclipsed the pre-pandemic rate of 164,633 Thousand. In August it was 164,746. The labor force participation rate has been dropping since August.

        As this number continues to drop in the coming months we will be told its the economy getting worse. Maybe the fed raising rates is solely to run cover for people dropping out of the labor force, due to death. The declining labor force could be blamed on a bad economy. But if the declining labor force were due to a bad economy, we would expect the unemployment rate to rise.

        I’m surprised the labor force participation rate is as high as it is right now. Maybe a lot of people aren’t necessarily dying?

        1. I read somewhere that the numbers don’t take into account ‘discouraged’ workers. Like me, for example. I took an early retirement. I wouldn’t be considered unemployed. There are a number of us who stepped out of the labour force.

          1. Indeed. You are right. You are no longer counted. Despite borders, the civilian labor force is struggling. Canada estimates over 500k immigrants next year. Needed to replace the people dropping out for the reasons we discuss, so the fiat currencies can maintain homeostasis.

        2. Are you sure these numbers are accurate? I guess close enough to take it at face value? Month to month with more reports next week. All these economic reports haven’t been bad ones. Just seems the FOMC rate hikes combined with the doom fear mongering are causing the downtrend. The downtrend amplified end of July but reversing and upticking the last few weeks, so why sell, why not hold? Who is doing all this selling to make the market go down especially if it is going to go back to where it was, not average retail traders.

          People are retiring at an increased rate. I’m still not seeing any glimpse of large amounts of people passing away from the jabs in my area. We see it in the news with the “died suddenly or unexpectedly memes” but no way to verify those deaths. I’m actually seeing more people and more traffic at least in my area. I’ve seen the death statistics show about the same rate year after year, even though some alt media charts show an exaggeration. I think there are media tricks at play to make us think something is going on, when it’s just media tricks. As we have seen with many events in the news. I would say sterilization is happening, whites are not reproducing enough. No incentives for whites to get married and start families or purchase large expensive homes.

          They can cull people with these poison vaccines and could happen in the future if they become mandatory. Remember earlier this year Wednesday Feb 9th, mandatory vaccination was in effect for many workplaces but was shot down the next day by the Supremes. So anything that makes the vaccines look bad, even fake death reports, is okay with me.

          1. The data do not indicate any protracted downshift in employment and the CLF. Sure, the marginal numbers diverge from long term trend, but overall numbers do not show any definitive result that would indicate anything the alt-media proclaim.

            I do suspect that immigration is covering up the sickness and mortalities that are manifesting. Rather, the employment data do not reveal any churn. The establishment survey has definitely diverged from the household survey all year. There is at least a 500k-1mm job difference that will have to be reconciled soon. Probably after the election, if course.

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