Housing Activity Remains Depressed

The U.S. housing market is in sick bay

Highlights

• If you are seeking out “tail risk,” and every CIO should be, then the heart of the deeply leveraged and opaque “shadow banking system” is one place to begin

• We have a situation where banking sector credit and deposits are both contracting, and we are supposed to be witnessing some new secular era of inflation? Really?

• Everyone is so myopically focused on the “hawkish pause” in yesterday’s BoC press statement but central banks never ever sound dovish at the peak in rates – fade the rhetoric

• Not even “less negative” YoY trade data out of China for August managed to spin the dial in a positive fashion (maybe because the trends are still negative, simply put)

While We Were Sleeping

Soft start to the day for the equity markets — right after the S&P 500 sliced back below its 50-day trendline (ditto for the Dow and Russell 2000; as well as for the Invesco S&P 500 Equal Weight ETF, which slid -0.3% after faltering -1.2% on Tuesday; the Nasdaq is riding a three-day losing streak).