Pouncing on Property Prices and Gold
In response to the crisis, mortgage rates have plummeted. Yesterday, we saw new home sales spring back to their highest level in thirteen years, showing people are taking advantage.
It’s millennial renters taking the full brunt of economic hardship, according to Pantheon Macroeconomics. The prospective home-buyers are onto their second or third properties.
This economic data of home sales at a record-high will challenge mortgage rates at their record lows, but also test the U.S. supply of housing. We may need more homes built, so we may need to call on homebuilders like Pulte Group.
If that sounds like a policy mess, it is, but consider the one that’s led to gold surging past $2,000 per ounce. If you print dollar bills to your heart’s content, you get inflation, and gold will go up.
It’s a safe haven also from the weakening dollar and perceived stock market-economy disconnect, like silver. It could well go higher, and the stock market, too, on a dollar-basis (multiples higher) if the risk of inflation heightens and the greenback continues to erode.
Jerome Powell and the Federal Reserve better have a plan in mind.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.