Consumer Economy

Median New Home Sales Price (MSPNHSUS) 398.3K -13.7K (-3.33% m/m)

New Home sales prices are slowly moving lower, breaking below the 400k level this month.

Looking at new home prices over the last 40 years, priced in USD (black line), they’re massively inflated. But priced in ounces of gold (red line), they’re actually LOWER than they were back in 1975.

• 1975-01: $37,200 = 204 gold ounces
• 2026-06: $398,300 = 88 gold ounces

In dollars, home prices are up 10.7 times.  In gold, home prices are down 57%.

Credit & Rates

• Total Bank Credit (TOTBKCR) 19.74T +96.8B (+0.49% w/w)
• Fed Balance Sheet (WALCL) 6.75T +4.3B (+0.06% w/w)
• US 30 Year Mortgage Rate (MORTGAGE30US) 6.58% +3 bp
• 3-Month Treasury (DGS3MO) 3.90% +5 bp
• 1-Year Treasury (DGS1) 4.13% +12 bp
• 10-Year Treasury (DGS10) 4.69% +14 bp
• 20+ Treasury ETF (TLT.N) -1.50% w/w
• US Confidence (AAA10Y) 1.15% -2 bp

Bank credit screamed higher this week, rising 96.8B.  If this happens each week, that’s 25% annualized. Sectors include:

• Treasury and agency securities: +54B
• All other loans and leases: +21B
• Commercial and industrial loans: +14B
• Real Estate loans: +3B
• Consumer Loans: no change

Bank credit growth (bankster money printing) saw nothing going to consumers, a little to business, but was mostly about buying treasurys, MBS, along with AI (all other loans and leases).   That crazy black line below has already been put through an MA4, so we’ll be seeing the impact of this big increase for the next 3 weeks.

The Fed printed money (red line) – but it was barely visible.

Rates jumped higher, with the largest increase seen in the 5-year [+16 bp]. Even at the short end, the 1-month is now 3.76%, 13 basis points above the Fed’s rate.  Rate increases happened just about every day this week – it wasn’t a big one-day rally.   The markets are raising rates – will the Fed follow?  I suspect probably not yet.

Given the large increase in the 20-year yield [+12 bp], TLT had a bad week, falling 1.50% to 83.25. That’s the lowest weekly close since 2023, and we are not far from a breakdown to an all-time low (around 80). If we get a big recession, TLT will probably reverse direction. Until then … TLT doesn’t look so