Maybe I have fake news on the brain -- don't we all? But I have to admit that it is rare that I have seen such amazing distortions of time-honored data, data that can really help us figure out the future.
Case in point: Homebuilding. We know that we are still putting up far fewer homes than we did before the Great Recession. I think lots of people are interpreting that as demand weakness. No fake doesn't mean wrong, it can mean the wrong agglomeration. We got some weak numbers out of Southern California home prices Tuesday and you could easily extrapolate those figures to say that housing demand is light.
I would come back and say that right now the Southland is an anomaly. Does that mean it's going to become the norm? I say we can't tell because there are great swaths of this country where there simply aren't enough homes being built to meet demand because of tough environmental restrictions. At the same time, though, there has been rampant labor and commodity costs. But, wait, aren't those artificial? The commodity costs are by fiat from President Trump as a way to get Canada to heal.
And labor? That's because President Trump has cracked down on illegal immigration that it's become a part of the territory.
Rates are low, though, which should make homes more affordable. But rates are up gigantically from a year ago. But the 10-year is being manipulated lower by central banks.
In the end you just kind of give up. And that's just housing.
My bottom line: Be careful of your judgments. We are in very uncharted waters.