Transcription
You don't even have to ask for their
financials. I mean, this is crazy. Like,
you don't even want to know if they can
pay. The shadow market is about two and
a half times bigger than it was during
the last crisis. Existing home sales
last year were the worst since 1995, and
we've increased population by over 20%.
What's up, freaks? Before we get into
the show, I just want to send a
heartfelt thank you. Thank you for
joining us and ask for one quick thing.
Could you like this episode? Subscribe
to the channel and if you like the
conversation, join us in the comment
section. All right, take two. Melody,
welcome back to the show.
>> Thank you so much. Thank you for having
me. It's my pleasure to be here.
>> Well, like I said, it's timely talking
to you as somebody who's settling on a
house next week. May not be the best
market to do it, but I got to get my
forever house. Um, and for anybody who
didn't catch the first interview with
Melody, uh, in Q3, beginning of Q4 last
year, just a little background, Melody's
a housing market analyst and independent
researcher. Uh, she's based in
Tennessee. She runs the M3
Melody Substack, which is great. Uh, I
highly recommend subscribing to it if
you want to stay up to date on this.
She's doing deep dive analysis on
housing data, labor markets, and the
intersection of government policy with
real estate.
former mortgage industry professional
who now does investigative field
reporting, literally visiting homeless
camps, detention centers, and distressed
neighborhoods to ground truth the data
she studies um collaborating with other
researchers and getting uh data from
Fred and AR census and county level
records and uh like I said, I think your
most recent newsletter that you dropped
last week talking about uh home sales in
December uh the retail sort of credit
situation and the stress the consumer is
under is something that uh many people
are not aware of because we're being
told that the uh the economy is running
hot. It's the best economy ever. But if
you look under the hood, things are not
all well from your perspective. So, what
are you seeing out there, Melody?
>> Yeah. No, I think you summed it up
nicely. I mean, you know, we've been
seeing this um this this under the
covers trouble for some time, especially
in what I'll call government subprime
FHA. Um you know, when those student
loans started reporting to credit again,
it really uh impacted a lot of the
people who should be forming households.
And so you had people going from 750
credit scores to 550. And so very
quickly, you know, credit got cut off.
At the same time, you know, um in the
mortgage market specifically, guardrails
went on the FHA program which were being
taken advantage of. Um a lot of
fraudsters were taking advantage of it,
but essentially you could just keep not
paying over and over and you would go
get another workout and another workout
and so Guardwells went on that program.
So um you could when we look at stuff in
the aggregate Marty I think this is
where everybody you know can have that
false sense of calm because it looks
okay like oh you know home equity that
looks like that's great unlike the last
time people will often say but there's
so much going on that's new that people
don't understand like today for instance
CLA reported right and um they had a
loss and they are very much some of the
people that use CLA
buy now pay later are the exact people
that would be um that we would hope
would be out there buying homes but
unfortunately they have to you know
basically finance their burritos. Um and
so you know you look at the youth
unemployment rate. I mean so I I guess
in there are so many things so much
weakness under the surface that almost
no one is paying attention to. And so in
all p pockets of the market, be it in
mortgage where you're you're starting to
see delinquency rise and we're going to
see that from here. Um you're actually
starting to see the prime books get
impacted and they always come after the
subprime. um you know when the layoffs
happened. And the and the issue now is a
lot of this lending was made on inflated
credit scores um and that did not
include you know the student loans and
things like that or you know those
eviction moratoriums um and now those
inflated credit scores are coming down
with student loans reporting. So it's
just a much uh murkier picture than what
people and I don't know how anyone can
um say uh anything positive. I mean,
existing home sales last year were the
worst since 1995, and we've increased
population by over 20%. I mean, so, you
know, this market is completely frozen.
Um, you had a lot of raged e-listers
last year, um, that couldn't get the
price they wanted and so they just took
it off the market. But what you've seen
since the recent Bitcoin route, kind of
what happened there and the wobbliness
in the stock market is inventory is uh,
flying to the markets. I had had been
coming off, but now it's flying on
non-seasonally. This isn't the time of
year you would typically typically your
inventory bottoms in February. So,
>> well, I thought it was interesting that
you covered uh the Bitcoin price drop in
gold and silver in this newsletter
because I'm not sure if you caught on to
this meme, but I think Bitcoin is a
leading indicator of liquidity, right?
Like it trades 24/7, 365.
uh it's very easy to sell and get cash.
And so if a liquidity crisis is pending,
it's one of the first assets to go. And
so that's what um we've been talking
about in the Bitcoin space with this
this price drop of 36%
48% since the highs of uh late October,
early November last year is that
something's got to be wonky in the back
of the system from a liquidity
perspective. And
>> I think a lot of the data that you
highlighted in your newsletter last week
points to this. I mean, looking at um
credit card spending in December alone,
uh looks like people were tapped out of
cash and really
>> pulling out the plastic to to do their
spending around Christmas time. And then
I I think it would also be important to
really dive into the um the new home
listings and and home sales in December
because those are some pretty historic
lows in terms of what's coming to
market, what's actually being sold.
>> Mhm.
>> Yeah. So, uh specifically, uh on the new
home side, we're going to get uh results
tomorrow for both November and December.
and and we you know we've been going off
we only got October cuz this is the one
who prepares that but on the existing
home side I mean yes a lot of people
wanted to blame the storm Marty but
California is our biggest h housing
market out there and the storm came very
late in the month um it was just I mean
these were just really bad sales like
worse than 20 January 2007 worse than
January 2008 and you you know, again,
the population is is much higher. Um, I
think there's some things going on
though that a lot of people don't
understand, which is I think that uh the
National Association of Realtors, these
listing sites, the MLS, they're losing
relevance. And so, I think that we're
actually having there are quite a few
transactions that aren't being captured
uh in their statistics. Um because you
had a lot of people, they did this back
in the 80s too when rates rose is you
had a lot of seller financing because
you know uh people couldn't get approved
at the higher interest rates and so the
seller would say I'll finance this for
you. Um those and and selling homes. So
some of those some of the transactions
are just not being captured a lot of
them by the investors as well. And so,
you know, we're just the housing market
has always taken it. The uh indicators
are very lagged. Uh the data is not real
time because a lot of it to really get
accuracy is pulled from county records
and uh that is that can be there's over
3,000 counties in the country and some
of them, believe it or not, are not on
any kind of e-record platform. They're
still mailing stuff in. So, you know, I
I just say that because although sales
are horrible, I mean, they're just
absolutely horrible. I think we are
missing um a component of the housing
market right now with these private note
actors um that are out there transacting
not on the MLS. So, I just kind of
wanted to state that um because I think
people are going to be surprised when
they realize um how much inventory is
out there and because I talk to them all
the time. They say, "Well, look, look at
what was on the MLS in 2008. There were
4 million homes and now we only have a
million." And I'm like, "Um, yeah, but
there have been studies that 50% of
transactions aren't like let's say in
Austin weren't handled through the MLS."
So I we have we're just it's a very
murky muddy picture um that I hopefully
I haven't lost everyone with those
details but uh what we are starting to
see is median listing price. Uh so
that's the idea the median of whatever
the listing price was um that has now
come in negative year-over-year uh for
two months in a row. Um it's now under
400,000 for the first time since 2022.
You know, while the builders on the
other hand, for their prices, uh, they
have been, uh, selling under the
existing home price for almost a full
year. In the last cycle, we saw that one
month, one month in June, I think, of
2006. And so, you've got this these
crazy uh fundamentals where the new
homes um are selling below 400,000, a
median price, and then that's not even
including the 50,000 of incentives
they're putting on top of that. And so
we just got builder sentiment and uh it
went down again as well. So I'm really
looking forward to new home sale results
tomorrow because it'll give me a clearer
picture. But at this moment, last year
was the worst we've had in, you know,
over 30 years, which is insane.
>> Yeah. Just anecdotally to confirm one of
your thesis there. I mean, the house
that I'm buying, we did offm market, so
it didn't hit. Um, we're in a
neighborhood where you have a bunch of
aging out boomers who want to hand it
off to younger families and so we're
able to do that transaction directly and
I think there's a lot of that going on
at least where I am.
>> I do too. And and then, you know, if
you're not pulling from public record,
then no one really knows what the median
price is out there. You know, if homes
aren't selling that are, you know, uh,
or they're selling but not being
captured in the MLS, then we really have
no idea what is going on out there. But
what you can get a sense of, you know,
cuz I track 85 markets, is there's price
cuts everywhere. They're just not
selling those houses. They're just
continuing to do price cuts. And so,
it's going to be one of those gradually
than suddenly things, you know, when you
actually can get someone in the market
to buy. But that's the thing. There's
just nobody left to buy. And the
institutionals are not interested at
these uh price levels. Well, this comes
back to something else you covered in
last week's newsletter, which is
non-farm payrolls and the revisions. And
I think that's um one thing that always
makes me chuckle is you get the the
headline number and then 9 months, a
year later, you get the revisions and
nothing's as rosy as it was originally
reported.
>> No. And that just seems to be happening
on every front,
right? And so I I think you know just
take the new home uh sales price for a
minute. They they shaved almost they
revised five years of history through
the co and shaved $30,000 off of the new
home price high. Okay. Peak they it was
at 496. They revised and said no. Then
they didn't tell us why. They really
tell us why. But now it was at the peak
was 460,000 on the new homes and just 5
years of what we thought was reality
just got wiped out. And so I that that's
the limitation I think of the data and
that's why I think you have to go look
for yourself and you also have to you
know track non-traditional uh metrics
because um there's just we're not
getting the full picture out there in
any way.
>> Yeah. Well sticking on the jobs market
too. I mean, you highlight that there's
a bit of a jobs mirage with education
and health services carrying the entire
labor market and we've come to find uh
with health services specifically, it's
a lot of that's driven by overt fraud.
>> Exactly. That's where a lot of those
Somali's uh jobs were. You know, that's
where they sit. And so what happened
after the American Rescue Plan is all
this money went out to the
municipalities and they they created all
these programs like housing affordable
daycare programs whatever and they
employed a lot of people theoretically
although I think a lot of it was fraud
and so that's why you've seen that job
growth but what's happening now Marty is
these municipalities have run out of
money and it's not coming I mean
California is a great example of um they
are in so much trouble Um Chicago,
another example, they don't have any
more money to fund these programs and
they're not going to get it from
federal. Um they might get a little but
they're not going to get enough to
sustain them. And so, you know, we're
we're looking at a bunch of
municipalities in crisis, which will
impact those education and health
services jobs, which is the only jobs
that were created last year. Really?
>> Yeah. And if you're not getting a health
service or education job, you're getting
a second job, which is
>> Well, Right. Right.
>> You That's the highest percent of
workers holding two part-time jobs ever
right now.
>> Yes. Ever. In the series since I think
it goes back to the 60s. So, yeah,
that's nuts. It's So, two two part-time
jobs just to make ends meet. I mean,
that's insane.
>> Yeah. And then I mean, we don't want to
be too dimmerish here, but we're trying
to distill exactly what's going on. You
also mentioned like private credit in in
last week's newsletter and that was
actually
>> funny enough the FOMC me uh meeting
minutes from last month came out earlier
this week and private credit was an area
that the the board highlighted as
something to pay attention to and that
is wearing them. And this is another
thing that's not tracked in this space
like so so what you know you have your
old traditional hard money lenders which
would like you you don't it's like a
personal loan um but they were very
they're they were usually regional and
they uh would make you pay a huge down
payment or um an exorbitant interest
rate to kind of cover their risk. What
private credit did is they came in and
what they thought their sophisticated
underwriting models, they weren't that
sophisticated. They just went off the
credit score basically. And so I've
talked to people in this space that are
freaking out because they know those
credit scores were inflated. I mean,
look at CLA today like that that is we
knew this was coming uh uh because we
knew that the numbers they were
reporting for delinquency could did not
add up. But yeah, and so you've got a
ton of private credit out there and the
banks have lent to um you know people
like Tricolor and and those actors who
have gone out and lent money and they're
not recording deeds. Uh so we don't know
if there's many money lent against the
house and they're also many of them
aren't reporting to credit you know and
so it's it's just a big and and we know
that the shadow market is about two and
a half times bigger than it was during
the last crisis.
>> Yeah. And I saw the headline yesterday
about subprime auto loan delinquency
rates skyrocketing and obviously 90 plus
day delinquency rates on
uh real estate are rising as well. And
I'm just wondering how much of that is
due to the uh immigration policy the
last year like how many um immigrants
that were here illegally but were able
to get FHA loans and subprime auto loans
um simply had to leave the country which
is driving that up. But regardless,
there's still
>> no one can really track that.
You know, I've been trying to get good
data on that, but there's just not
really good data.
>> Yeah. Well, you're you're talking about
the 90 plus day delinquency rates um in
real estate specifically, and there's
some sort of foreclosure game going on.
>> Oh, the sub two.
>> Oh, yeah. I'll talk about So, I'll I'll
I'll talk about what's going on in
delinquency. So, um, basically, uh, when
the guard rails went on that FHA loss
mitigation program, which was just
basically an open teal to whoever wanted
to come take advantage of it, um, that
meant that we were going to see serious
delinquency increase uh, because they
are no longer eligible for some of these
workouts or they have to do things like
make a trial payment. So, let me give
you I have one borrower in one of my
client books who went back six times and
has been delinquent for the past two
years, but nowhere near foreclosure yet,
Marty. And so, you know, that because
all that government intervention and
workout and so that that's all finally
running out, believe it or not, and will
run out over the next 12 months. Um, and
so that serious delinquency is going to
go up. It we'll get a little bit of
improvement. uh we always do in the
spring with B like bonus payouts and tax
refunds and things like that. What'll be
interesting to track is how much and uh
because like for auto it didn't help
last year. So we'll be watching all of
that. But what you are talking about so
this is something the mortgage industry
has no idea is going on. um it's called
sub two are subject to mortgages and
what these investors did is they would
when when you are in default the serer
has to record something called a notice
of default or a liz pendants uh saying
that you're about to be uh a complaint
will be filed against you um so the
investors will go research those and
then they'll go contact you and they'll
say hey listen um I got a deal for you I
could take over your mortgage payments
for you um if you sell me this house um
and I could maybe give you an equity
sweetener or you could rent from me for
a little while and this investor is
trying to find someone u while they're
doing all that they're trying to find
someone to buy the home from them.
What's happening now? Um, initially
these investors would record those
deeds. Um, but there's this thing called
a do on sale clause that if you sell
your home, your note becomes immediately
due and owing. Um, so what's happening
now is these investors, as we as I knew
they would, cuz they always do, um, they
walked away and now the borrower is on
the hook cuz they're still on the note.
Um, and so they're being, you know,
foreclosure proceedings are going
against them. They may not even be
living in the house anymore, Marty. But
this is a huge uh kind of it's part of
that private note shadow market that I
was talking about. And I think this is
one of the things that's kept
delinquency lower. Um but people can no
longer when home prices aren't
appreciating, you cannot get a buyer to
come in and just, you know, pay
ridiculous money for that house anymore.
And so they're they're, you know,
they're walking away. They can't make
the payments. So there's just a ton of
stuff going on in this market.
>> Well, and that's sub 2 K. The the
investors are walking away because they
don't have the cash or are they just
saying, "Hey, this isn't worth it." And
>> those things. Yeah. Uh it's not worth it
or they don't have the cash.
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>> I mean, for for the private credit
specifically, whether it's hard money
lenders, these sub 2 investors and you
get like commercial real estate, it's
got to be again the Fed calling it out.
>> Yeah. last month or the FOMC it's
becoming abundantly clear that private
credit is in trouble and we had what was
a blue owl last night blue
>> stop uh stop redemptions on one of their
retail oriented uh private equity funds
it seems like
>> right
>> all the cash that was printed and
flushed into the economy in 2021 2020
it's not getting the return that those
investors hope it would
>> no and and you know especially there's
so much private credit in real estate,
you know, like 20 to 25% of the loans in
private credit, I mean, of commercial
real estate are private credit loans.
And I mean, so yeah, this is a dumpster
fire and it's um you know, and I
guarantee you that a lot of the people
that are at these firms know how much
trouble they're in, but they're not
telling anybody. You know, it takes a
long time as we can see. I mean,
Blackstone, for instance, is in a ton of
trouble and um you know, and and it's
but they they can keep up appearances,
but they're running out of time. Um
they're losing enough on the commercial
real estate, they're losing enough on
their single family rental business that
I think we're going to start seeing
impacts uh in in in Breit, for instance.
Um you know, we'll we'll hear about them
gating redemptions again as well,
probably in the near future. That's been
one of my sort of tinfoil hat theories
with Trump uh announcing that these
investors can't buy single family homes
anymore. Uh and his $200 billion uh
mortgage buying um facility. I don't
know if it officially launched, but he
announced it and
>> they had already been doing it. They'd
already been buying the NBS. Yeah.
>> Yeah. Particularly with the former
though. It's like is it just a slight
bailout? You're going to say they can't
buy
>> Oh, it's a total bailout. Yeah. That's
it's a bailout for them. cuz I was in
the room with one of them in September
and he's like, "We've been chasing price
for a year." Um, you know, they they
don't get a homestead exemption. So,
they their taxes are much higher, their
insurance is higher, and so they can't
they are as soon as these long-term
rentals uh the leases expires, they're
rehabbing them and selling them and
which is why you're seeing um price
declines in places like San Antonio and
Atlanta and Tampa because you have very
large institutional presences in those
cities.
So,
>> yeah, it's a bailout, Marty. I mean,
that's I I guarantee you this is phase
one. Oh, you can't buy these homes
anymore. Phase two is like, hey, you
know, we'll give you a deal if you sell
these homes uh you know, through one of
our affordable housing programs.
>> Well, that's what I was saying. It maybe
they have like a BTFP
uh BTFB facility. They're going to say,
"Hey, we'll just buy we'll buy these
assets of par for you."
>> 100%. I I I I bet we'll get there.
>> Yeah. And So where where do you think
the sort of rubber meets the road and
this becomes obvious to the market?
>> Oh, I don't know. You know, the fact
that we're in an election year like um
you know, I I think that there is like
there's a it's accumulating the
awareness like you know it's no longer
just Florida and Texas like California
is on the board. Like it is on the
board. you're starting to see a
deceleration in the Midwest and
Northeast on their home prices. And I
think pretty soon mid the Midwest will
turn um because they they just I mean
investors descended on them because they
were the last place you could get a
decently priced single family home. Um
but I think it's going to take till the
Northeast
has some sort of awareness for there to
be national awareness. Um, and the
Northeast has a ton of problems around
their demographics. And, you know, those
census updates are huge. Uh, showing
everybody they didn't quite get the
population gain that they thought. And
um you know the northeast very low owner
occupancy which means um you got a lot
of mom and pop investors uh most of
which are boomers who are aging out and
will be um I mean what is what's really
interesting Marty I'm seeing in uh the
cities I track is that the the rate of
folks who are deceased property owners
like so you can track who's deceased is
I mean in some cities up 25%
year-over-year and so you know th this
is going and and Charles Schwab did a
study and said 70% of the time people
who inherit property sell them. And so
all these things take a little bit of
time. It takes time to get through
probate. Um but I think the demographics
are going to uh really start to uh
become obvious in places like the
Northeast and and Boston and actually
Philly and Pittsburgh both have been
showing price weakness. And so um but I
think until the northeast falls there
probably won't be large scale awareness
but with the price cuts I'm seeing um
you know once we can get activity in the
market we are definitely going to see
that uh suddenly you know hit the
gradually then suddenly um but it we
could skate for another another selling
season uh based on you know and promises
Um, but I I have a feeling we're going
to see uh some uh disorder in this
selling season, especially in places
like Texas and California.
>> Do you think this is necessary?
>> Oh, yeah. I mean, yes.
>> I mean, if they'll let it happen. um
they're going to try everything, but
everything there's just there's a point
where everything doesn't work anymore,
you know, like everything they've tried
like like I love to talk about they
bought mortgage back securities back,
you know, in 2009 and uh you know,
prices just kept plummeting. Um and it
didn't do anything like it it created a
little refi boomlet in 2010. Um, but now
we've got people like the Fed reported
over 43% mortgage refi rejections and so
people can't even uh, you know, they
can't qualify for a refinance. It's the
highest in their series, you know. So,
it's just um, it's just a slow burn
that is it's gaining speed and gaining
traction, but if we could get
transactions, we would see true price
discovery. And yes, it's absolutely
necessary because, you know, household
median income is not even in the same
ballpark as, you know, median homes
prices. And so, who's going to buy
these? It's not going to be the
institutionals. It's not going to be uh
your millenn your your, you know, your
cohorts coming of age. I mean, the
unemployment rate in the 18 to 24 is
insane. Um, so like we're not going to
form households until the affordability
problem is fixed. And so, yeah, I think
this is necessary.
>> Yeah. Then you have the AI boom
happening which is telling the uh Gen Z
and Gen Alpha, don't even try to get a
job,
>> right? As if their lives couldn't be
more depressing, you know, like it's
just it's it's kind of Yeah, it's really
it's really not good for that cohort
right now.
>> No. Well, you have the whole K-shaped
economy meme becoming more prominent. I
think it's becoming more confirmed. It
is uh
>> Oh, yeah.
>> It's not easy out there. uh particularly
for the younger generations and and
again going back to the demographics and
push coming to shove with boomers aging
out and um just factually dying out as
well like the the flood
>> of supply that just if you're just
looking at the math that is due to hit
the market uh is going to be pretty
significant and this goes back I mean
this is something I've always been
curious about with new home builds too
when you consider the quality of new new
builds compared to older builds builds,
particularly if they were built like 50
years uh or longer ago. They're actually
sturdier. Like the house we're buying is
>> is very old and I feel more comfortable
in that than some of the new builds
coming up. And this whole supply
>> um meme that's been going out there, you
have podcasters like the all-in guys and
the president
um this administration saying we just
need more supply to bring um to bring
prices down. I I I don't think that's
the case. And on top of that, the new
supply
>> is not a quality quality build at the
end of the day.
>> No, because who was building it? And you
know, it was subcontractors of
subcontractors, but they were illegal
immigrants. That's who and often I you
know, on these new build sites, Marty,
it's it's it's uh it's a little scary.
Like you're you're see like we did one
video where we just went around got the
Jack Daniels bottle, the Medela cases,
empty cases, like the empty beer bottles
that were just all over. I think it was
LAR job site and so you know the quality
is horrendous. There just wasn't I mean
all these uh thousands of new home
communities I went to, you didn't have
um
these did not look like professionals
building these homes.
>> Yeah. and nor were they managed by
professionals on site. So
>> yeah, so how much of like the lack of
new home sales does being driven by
people looking at these be I'm not
buying this papermâché box,
>> right?
>> And then what is
>> I think that's part of it.
>> What is the exposure to these?
>> No. Yeah. And not only that, they built
luxury. It's like who are you building
for? Like, you know, I know in 21 we saw
wages rise, but not like something
crazy, but that's what happened is all
the builders went out there and built
for the California and New Yorker that
was coming to their town and built
luxury apartments and all luxury homes
like these gigant some of the speck
homes I've seen out there just blow my
mind. Like $13 million speck house, $25
million speck house, meaning they didn't
have a buyer. They just built that house
and it's like this massive luxury
structure that you can go in all the 85
markets I track and you can see this
luxury sitting empty. There are not
enough people to buy those homes. And so
I think you're going to have um there's
going to be a lot of bulldozing when
people really finally start to deal with
the problem. But we're we're we're far
from that right now unfortunately. Like
people people are still believing that
it's an inventory shortage.
the I mean, we talked about this last
time around, but when I was in Austin,
uh there was one of these luxury builds
around the corner from us. We moved in
2021. It finished construction, I
believe, at the beginning of 2022, and
we left June of last year. Was still
sitting there up for sale.
>> Yeah. And and what's crazy is a lot of
these cities are still building them.
Like Phoenix, I'm just like, you people
are nuts. I mean, and and they're
everywhere. And it's so weird. It's like
these developers, they never just drive
around the town. They never just even go
two blocks over. Like Nashville is
another good example. If you if and when
you go back, like there's a attached to
downtown is just like apartment on top
of apartment. I mean, if all of those if
50% of those apartments and they're all
new were filled, you would never be able
to leave your house because the traffic
would be so bad, the congestion cuz they
just built all these things on top of
one another with no parking. And and
that's the really sad thing about a lot
of this is that uh people just, you
know, sat new builds down in cow
pastures wherever they could find, you
know, they could build and they didn't
think about infrastructure. And so, you
know, and I've seen some really uh sad
small towns be destroyed across the
country due to like, okay, you're
outside of Raleigh. Oh, that's going to
be the new Apple um headquarters. Oh,
no, not so much. Maybe not, you know, or
whatever. So, um, and so they went to
these little towns and just like
destroyed them. They like bought up all
these older homes and fixed and flipped
them or just, you know, put those new
build communities, but there's no way to
get in and out of these towns like it's
all, you know, two lane. It's just it's
so it's so sad.
>> Very high time preference. The describe
it as the high velocity trash economy
where you're just building to build to
hit your uh your quarterly.
>> Absolutely.
What do you think the knock on effects
of all this will be? Um,
>> well, we're going to see crime increase
a bit. I mean, if if that I mean, that's
that's an effect because the vacancy out
there is a massive problem that nobody's
talking about. Um, and you know, it's
only a matter of time when all the
homeless in Austin figure out, you know,
10 miles uh south there's an empty new
build that nobody's policing. It's like,
why don't we just go set up shop down
there? Um, you know, but I think you're
seeing it already in cities like Dallas
in the downtowns. Uh, they're they're
just they're they're terrifying. I wrote
a an article for Unicus Research last
week which was called Creepy is not cool
because um these downtowns are creepy. I
mean, they're just creepy. You don't
want to be in them, which means they're
never going to be able to get, you know,
they're not going to be able to attract
new business down there either. And so I
think you're going to have an increase
in crime. Um, you know, we're already
seeing an increase in homelessness. Um,
and so,
but later down the line, if you're not
in debt, uh, and this is really
important, don't get into stupid debt,
um, and you have a a job, like you have
a job, maybe you're a plumber, maybe
you, you know, instead of going to
school, you went and did a trade. um
then you're going to be in a good
position to get a home. And so that
that's the the long, you know, after a
few years that's the effect. And in some
of these markets, it'll be before then
um as well. But yeah, I mean, we're
looking at I I I think we're going to be
looking a lot of m municipalities like
filing bankruptcy. And I think they'll
probably be begging for help from the
federal government to deal with these
vacant homes. Um, so and cuz a lot of
these homes were bought with all cash
during this last cycle, which means
they're not sitting on a bank's balance
sheet, which means you're not the grass
isn't getting cut. Uh, the pipes aren't
getting winterized, the mold's not
getting removed. Uh, so that means all
kinds of issues. I mean, I saw it when I
managed a fault during the last crisis.
I mean, these homes get into the worst
shape. Um, and you almost can't even
recover them because, you know, they're
just in such a state of disrepair.
>> Yeah. When you say downtown Dallas is
great. Like, so what do you mean
specifically? What are some examples?
>> So, so uh what's crazy about Dallas uh
is they've got these massive um you
know, highrises, uh commercial real
estate, completely empty. And on the
back of it, uh, you see a stroller and
evidence of homeless that have been
living there. Um, and then right next
door, they have this massive high-rise
that's being completed, office building.
But if you walk in downtown uh, Dallas,
like it's just it's a ghost town. It's a
ghost town. Um, and and it's creepy
because you're walking around it uh, you
know, you're seeing these what looks
like homeless camps in downtown Dallas.
So, uh, you know, that's that's and but
this is every I mean it's every like San
Antonio, you know, uh, very similar
situation. I when I was in San Antonio,
I saw somebody OD right in in front of
us. Like we were in the truck like
filming downtown right next to us, just
OD. I mean, it it feels as if most
people haven't been to their downtown in
a very long time cuz they just are
unaware with how how creepy these places
have become because they're just empty.
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>> Do you think despite the
your positioning by this administration
that everything's all good, economy's
hot, they understand these these
problems exists and they're just I think
you described the saber rattling between
uh President Trump and the Federal
Reserve is Kay Fob. Um, do you think
similarly the projection of everything
is
>> is all well and great is K fob 2 and
they know things are not all well under
the hood and they're just trying to
narrative craft until they can uh find
an excuse to actually flood the system
with more liquidity.
>> Yeah. So, you know, this is a question I
just I I obsess over. I can't, you know,
it's like um
they have to know some of it. Um, and
and if you know, but I have a feeling
they don't know all of it because I talk
to people in government now and about
their cities and say, "Did you know
this? Do you know that?" They don't
know, you know, um because that's what's
happening now is I'm getting contacted
by more policy focused people who want
um to talk to me about maybe solutions.
Finally, that's happening. um but they
aren't aware of how much inventory they
have and and in places like Texas and in
some unincorporated areas across the
country you didn't even have to file
permits and so a lot of the local
leaders don't even know and so um I
think it's funny like PY followed me for
years uh before he got and you know he
would share my stuff and all I ever do
is talk about the inventory shortage
myth and you But the day one into the
administration, he uh you know sang a
different tone tune and and I actually
know uh the CFO of Freddy, he was one of
the last people standing cuz they went
in and gutted the executives at Freddy.
I mean he was my boss during the GFC for
a certain he has to know. I haven't
spoken to him but there are just so many
clear telltale signs if you are in the
know. Um and and and so it's weird in
mortgage specifically like people who
originate the loans never talk to people
who service the loans and so the
originators never realize what's
happening on the back end. And so I
think we're still in that part of the
cycle where the origination narrative is
kind of driving the narrative. But in
servicing when I talk to the big
servicesers they know what's what's
happening. So I think it's probably a
combination of they know but they don't
know the scale. But if if if it were me,
um, and I would never do this. I don't
want to be a politician, but if if I
were a politician, I would I would do
probably what they were doing. Like just
say whatever. Like what is it? You know,
you're just he's speaking to whatever
interest group in that moment. And but
you have to look at what the policy is.
And when they put those guardrails on
FHA, um, that was a real action and
that's going to have real consequences.
and and they have to know uh that
delinquency on FHA is is unbelievable.
And so there have got to be people on
that side of the house that understand
that this is really really bad.
>> Yeah. Is there anything similar going on
to sort of just vanilla bank loans? I've
been reading um uh Bill Morland's bank
rag data and he he was saying that that
they're just disguising sort of their
exposure to these delinquent loans by
some sort of 12-month window that
they're able to push it off the balance
sheet and looks like
>> it's better than it actually is.
>> Yeah. Yeah. And and Fanny and Freddy in
uh and FHA hasn't done as much of this
recently, but they do these things
called non-performing loan sales. And so
they'll literally take their delinquent
book and sell it and then turn around to
you and say, "Hey, our delinquency is
only 67%."
Well, where'd those loans go? Okay.
Well, they went to private hedge funds
who then turn around and sell it to
individuals who don't report to credit.
And so, you know, like we just we just
don't have a very uh clear view of
what's really but yes the the the you
know I try to help people understand
that
what they did is instead of waiting for
the crisis they took these they took the
old loss mitigation programs from the
GFC and they put them on steroids and
they took away all the requirements and
things you had to do cuz back then you
had to virtually reunder to write the
loan. Well, they said you don't have to
do that anymore. You don't even have to
ask for their financials. I mean, this
is crazy, Marty. I mean, that's crazy.
Like, you don't even want to know if
they can pay. Like, what? Like, why
would you? It's all a game of extend and
pretend. And so, we've had, if you think
about it, we've had enough like the same
amount of workouts that we had after the
last cycle times about two or three. And
that's what's kept us skating for this
long. And now that stuff's running out.
So, it's just like what uh Bill talks
about.
>> Yeah. And it's funny, too. I mean,
talking about extend and pretend, and I
don't know if this went anywhere, but
you were mentioning Bill Py uh the the
50-year mortgage that was floated in
December. Where's your reaction to that?
Because we we haven't.
>> Yeah. I didn't want to talk about it,
but like literally everybody I I got so
blown up. I mean, my life went crazy for
a couple weeks, but I was just like,
"This is so stupid. I can't even talk
about it." Because, you know, by year
11, if anyone in this country like knew
what an emergencyization schedule
actually looked like, they would not
borrow money. I mean, but we're not
taught that in school. But by year 11 of
that loan, you would have paid $270,000
in interest.
That is what a median home should be.
our our median home prices should be
around that 250 mark, you know, and so
that's that's just nuts. That's nuts,
you know. Um, and it it's just debt
slavery. It's just another form of debt
slavery. And and believe it or not, they
had them back during the last crisis as
well, like some people do. You can do
them in California. Um, and they're
doing what's called a 40-year
modification right now. And it's not
helping anybody because basically your
payment goes down by like $20 and then
you add 10 10 more years to your loan. I
mean, I just hope people understand.
Please don't do this. Like, just please.
It's just you're going to be a slave
forever.
>> Well, you see this extend and pretend,
not only the 50-year mortgage, but I'm
not sure if you caught Google wanted to
issue a 100red-year bond.
>> Yeah. To fund their
>> Yeah, sorry. Yeah, I did. to fund their
uh their data center expansion. And
people look at that like, oh, look,
long-term financing. It's like, no,
that's we need to get suckers at the
table to give us cash so we can do this
and push our
>> Exactly.
>> push our payments out a century.
>> It's just so nuts. Some of the things
you see going on right now just make
your head hurt. I mean, you know, but a
lot of it is just, you know, it's just a
lot of delusion still. Well, what are
your thoughts on this data center
expansion and how does it affect I guess
commercial real estate? Um,
>> yeah, I mean industrial is already uh
they their vacancy is increasing. I mean
what I saw across the country was a lot
of new data centers for sale and for
lease and you know although I you know
um I forget how to say his name
Torstston Sluck or whatever from Apollo
like he has this chart out there that
shows that kind of data center
construction peaked in 2023.
So I mean Marty I I think we might be at
a point where it like it's already
happened. we're just not aware like like
the slowdown is already happening even
though they're all out there talking
about building you know data centers on
the moon and blah blah blah blah I think
that's just the somebody give us some
money for ridiculous idea kind of thing
um but I think that so two things one um
social media use peaked in 2022 you know
I think the numbers from open AI you
know they're going down like I think I
think this is all peaked already and
we're just we're still dealing with you
know kind of the delusion. And then the
second thing that's um going on is uh
you know the public is they they're
pushing back on this massively all over
the country. Moratoriums, people showing
up furious at um at city council
meetings because their electricity bills
are going up. And this is I mean you
know uh D Santis has gotten on this
early uh and then Bernie Sanders kind of
got in and now the Democrats are this is
going to be a huge midterm issue in my
opinion. Um and so I think we're not
going to have all that construction. I
think that we're just still running
through the uh uh the you know the mania
mode right now. Um but that in reality I
think they all know that that that
doesn't even make any sense. We should
be focused on if we believe um in this
technology uh we should be focused on
how to to scale it, you know, like how
to how to get the kind of power that
wouldn't just take down the entire grid
or whatever. Um, but I have a conspira
conspiracy theory on this one that I
actually believe a lot of what was
written into the BBB is about fortifying
the grid versus uh, you know, maybe
construction because I mean uh,
construction for private sector because
I you know the remember when they did
that big infrastructure bill during co
like what happened like nothing you know
and it's like our grid is not in good
shape and so I don't know if you saw the
uh, tweet by Trump before the storms
that he was going to tap data centers
for power um to shore up the grid. And I
so I think that some of this might
actually be a way to sell infrastructure
improvements um wrapped in a AI mania
narrative um just to
>> Yeah,
>> I actually wouldn't be mad at that. Like
I think it's critically necessary. We
need energy generation, capacity
expansion. We need transmission
expansion. To your point, the grid is
not in a great spot right now. could
certainly be better. And we've seen this
in Bitcoin. Like that's I've been in
Bitcoin mining for almost a decade now.
And that's one thing we do very well is
demand response. And so like in UROT,
the TVA where you are and mining
operations that um we're in certain uh
certain um price programs uh that we get
were we get a good deal because when and
this happened 3 weeks ago when the storm
hit when demand spikes like we get we
get asked to shut down. We're able to
send that electricity back um to
residential consumers.
>> Yeah, that's kind of cool. I mean, you
know, um,
>> but that's that's specific to Bitcoin.
You can do that with Bitcoin miners
because Bitcoin is a distributed system
and so shutting down mining operations
in Tennessee because it's cold doesn't
disrupt the Bitcoin network. It may slow
down
>> block um block production by a few
seconds to a few minutes, but that's not
going to
>> stop transactions from ultimately being
processed. And so you have a unique use
case within Bitcoin mining where
uh you have this sort of responsive
controllable load that can turn off in a
moment's notice. But when it comes to
the AI particularly if you're if you're
um training models and running inference
like those operations can't be
disrupted. Um Bitcoin it's called
disruptible load. um yeah
>> that that exist. And so like if we are
going to build out
>> these data centers and this
infrastructure like I think the Bitcoin
mines need to be or the AI data centers
need to be paired with Bitcoin mines
that that pro provide that disruptible
load to send electricity back to
residents when they need it when demand
spikes.
>> Great. Yeah. And I'm actually going to
be doing a trip here soon to uh Stargate
in um a bunch of the different data
centers in the south. um
you know I cuz I want to see what's
really going on there. I'm you know we
can't trust what we're being told.
That's that's what you know uh my
conclusion and the way that I really
understood what was happening in housing
was I went out and looked and so that's
what we're going to do is go go look at
some of these big sites and see you know
the ones in uh Memphis. Uh I mean that
that that's going to be a very
interesting case. It looks uh you know
uh they're getting sued. Um,
so you know, I I just think this is
there's going to be a ton of push back
on these. I saw Ed Dow tweet something
funny that I actually believe in that I
think what they're doing is spurring
this anti-technology movement. Like
people are are saying, I mean, I don't
want smart technology in my house. I
don't, you know, I don't want to be
woken up in the middle of the night when
Amazon uh AWS goes down and my bed like
bolts me out of bed by raising up or or
suddenly it's 150° on my bed like and
and these are the types of things that
you know I just we don't need that.
That's just stupid. Like what does that
do? And then you know these these
appliances that they're all smart uh
they die in like 2 years. the software
dies like whatever and you know so
there's no quality. So, I think actually
what we're probably going to see is kind
of the rise of a um you know, I don't no
more I don't want this stuff. You know,
>> there's a bunch of Uncle Ted acolytes
coming out of the woodwork to say, "Hey,
>> right." Right.
>> Right.
>> Yeah. It's uh I'm I'm very big
anti-smart guy, but again,
>> so I've been using AI at TFTC to help
just automate some stuff on the back
end. It's been extremely helpful. But to
your point, it's sort of threading the
needle and figuring out what the what
the appropriate trade-offs are, like how
to use this appropriately. And then I'm
sure you saw yesterday that sort of
white hat hacker research group um found
out that the company doing KYC AML for
OpenAI is just automatically piping all
the information to the government. And
you have this surveillance panopticon
that is being erected behind the scenes
alongside this AI technology. And
>> yeah,
>> there's a right way and a wrong way um
to do everything including AI um right
>> in and all layers of it from the energy
like to the data center
>> um discussion and the push back against
it like we've learned this in Bitcoin
mining
>> too and I think Bitcoin miners actually
have it worse because the machines
create so much noise. You have to be
very specific with where you plop these
data centers down. They should be like
in rural areas where
>> you're not going to disrupt um
>> uh residential neighborhoods because the
sound's too loud or it's just ugly and
eyes sore,
>> right?
>> Um and I I saw earlier this morning, New
Brunswick, I'm not sure which state, um
the the citizens there were successfully
able to convince
>> their city council that um to deny a
data center uh construction. But the
point being is like there's trade-offs.
There's a right way and a wrong way to
do it. I think AI is figuring that out.
Bitcoin miners figured it out. Uh uh
beginning of 2020, 2021. Um you got to
be very strategic where you plop these
down. And absolutely unfortunately due
to
>> the state of the grid and generation
capacity uh your options are limited.
But I think we need to
>> get to the base
>> of this industry, which is generation
capacity and smartly plop down
generation in areas where it's not going
to disrupt residential consumers.
>> Yeah. I wish we were having
conversations about what we want this to
be. You know, it just it feels like it's
so much hype. There's not really any
like, okay, what what what do we really
want here? And you know there the
technoculta
group
I can't uh you know the technocracy um
but I put cult in the middle of it. Uh
you know they have very things that I
don't think any of us really know and
understand as their end goals. Um you
know like the vi what is it vitalism
movement or whatever
>> transhumanism.
>> Yeah transhumanism. um we you know our
biggest problem is that we die you know
the these things and very tower babel
type stuff um so we're not really
sitting down and talking about what we
want this to be like the larger society
like the tech bros have a very specific
idea and I I just wish we'd have that
conversation but I'm just going to give
you a funny example for you know for
people to like how much of this is
narrative how much is reality like you
know when that software route happened
last week or a couple weeks ago So time
is just I don't even know anymore. Um
you know it was because theoretically
Anthropic came out with this legal and
marketing service. On the same day I was
talking to someone at a conference, a
builder conference where the attorneys
uh are now making bank because they're
suing people that used AI for contracts
and they're incorrect. And in fact I was
a expert witness on a case where the guy
um called me in to review. He filed a
complaint. He used AI to file the
complaint. And I had to go to him and
say, "This is all patently false.
There's not a single iod of evidence of
what you claim in this complaint." Well,
no. The letter said, and I'm like,
"Bring up the letter. What did the
letter actually say?" And so, there was
this moment where his brain is just, you
know, and he he he's told me, cuz I I'm
a skeptic. I believe in certain aspects
of the technology, but I think the hype
is crazy. And so he's like, you're wrong
on AI. This was two weeks before. And
then, you know, basically his entire
case was it was not a single uh fact was
correct in the complaint.
>> Um, so I I just, you know, we're just
not there yet. And and and I say all the
time, you can believe in the technology,
not the hype, but we're not being we're
not having real conversations about it
in my opinion. And what I saw in
corporate America is they don't have the
the gumption. They don't have the stick
tuitiveness like the, you know, um
perseverance to actually see any of this
through. They give up and they send it
offshore. They send it to India. Like
they just give up.
>> Yeah.
>> Because it's hard work. It's really hard
work.
>> Yeah. You have to It's not out of the
box like some Jarvis like wizard that
can do everything for you. You have to
know what you're doing. You have to know
what models
>> do what specific task the best and then
you have to check the work too.
>> Yeah, you got to check it out. Yeah.
>> Well, that's what I mean my biggest
worry talking about tinfoil hat like
conspiracy like I tying the Epstein
files into this. I worry about like a
Hegelian dialectic situation being put
forth where everybody's like look it's
all corrupt. The Epstein files are
proving this. We need a solution. And
then the transhumanist tech bros come in
and be like AI and
>> we get to minority report you now and
that's the solution. Everybody welcomes
it with open arms because they point at
the Epstein files and say this is a
poring which obviously objectively
>> it is but they they get um
>> that's how you get the antichrist and
>> right
>> the uh the fake solution.
>> Yeah. Yeah. I know I mean I worry about
that too and I worry that you know we
are the noise out there is so massive
right now you know it's just like
dialogue conspiracy and I and I don't
mean like conspiracy like that it's I
think we can all realize now that the
people that were called conspiracy
theorists were just the ones paying
attention you know right yeah exactly um
and so I I but just the amount of
information we're getting like the I
mean it's just It's like it it's it's
there's a good theory out there for
everybody right now to kind of keep them
distracted. And I I honestly think
that's to keep them distracted from
what's going on in the economy.
>> Yeah. Sovereign individual predicted
this in the '9s. The noise to signal
ratio is going to go so out of sync.
It's impossible to
>> discern unless you have your facilities
about you and are your faculties about
you and are able to actually take the
time to to filter the signal through the
noise.
>> Yeah. what um bringing this back to
housing before we get too far down the
uh transhumanist techno
>> rabbit hole. I mean the demo of this
podcast is interesting. It's a bunch of
people older than me. Our core demo is
older than me. Um and so basically with
what you're seeing in the real estate
market, our demo is like older
millennials,
Gen X and boomers. What would your
advice to them be? particularly the
older generations that are sitting on a
bunch of real estate and trying to think
about what to do.
>> I think you have to list it. I mean,
just go ahead and list it and just, you
know, if you think that you're going to
be selling in the next couple years or
want to sell, I think you should go
ahead and get it listed because I think
all of a sudden at once, uh, you're
going to be in the middle of a fire
sale. And, um, you know, it it'll come
later to certain places and sooner to
other places. And that's what I really
try to to talk about. But um you know,
just list it and get a more realistic
expectation of what your house is
probably worth. I And to people that can
afford it, I say go get an independent
appraisal. Not to do with any loan or
anything like that, but just pay for an
actual independent appraisal. Um cuz
that estimate is lying to you. It's not
based in reality. it's not a uh a a a
helpful comp um comparison and so it's
just it's done a lot of disservice for
people, you know. Um so if you have real
estate you're you think you're going to
sell in the next you know 2 to 5 years
you may want to consider listing it or
getting a real appraisal. Um and then
you know I would say for those that want
to buy like um you know if you're
aggressive there are deals uh even now
out there but it takes homework and I
think that you know during co we all got
used to uh you know um not doing a lot
of work uh for things and so you have to
be aggressive. Um but yeah, you know, to
me what's going to happen here because
of the silver tsunami
is housing is going to become boring
again and it's going to correct to a
point where uh it is it correlates to
the median uh income, you know, and
they've subsidized this market to death.
Like they have literally, you know, so
people talk about, oh, what about this
new bill that just got passed? It's like
it's just more of the same. And most
people could get $25,000 in assistance
for down payment in their city, like all
over the country already. And so they've
brought in everybody they can into the
mortgage market. I mean, it's just dead.
It's dead. Like rates went down
massively last week, Marty. I mean, a
week and a half ago, purchase
applications went down this week.
I mean, refi went up, but not purchase.
So rates aren't going to do it.
we are certainly not seeing rising
wages. Um so really there's one option
out of this, you know, and that's home
prices have to correct. And so if you're
banking on that equity for your
retirement, you know, don't be the last
one out of the door. Like it just, you
know, but if you're this is your first
home and you think you're going to be
here for the next 20 years and you don't
have to worry as much about this kind of
stuff, you know, you want to have
reserves on hand for sure in case you
lose your job. Uh but you know, you've
got a different goal. Uh unfortunately,
probably about 40% of the housing market
though is speculation and their goal is,
you know, uh yield and rising home
prices and and cashing out that equity
um to keep the party going. So,
>> I mean, on that last note there, like
how how's the Airbnb economy? All those
uh Airbnb wizards who emerged in 2021
and 2022, are they tapped out? Have they
fires sold yet or are they still holding
on?
>> They're so a lot of them are fireelling.
You know what was funny is they made a
transition for a little while to like
the whole narrative would be get out of
real estate, get into Bitcoin before,
you know, we kind of saw that route in
April or whatever. Um but yeah, so
uh that they're coming to market and
like in some of the more crazy markets
like Seirville, Tennessee, like you can
see the distress is bad and they just
built these homes that make no sense,
you know, for families of 15, you know,
that that is it's just not and then
places like San Diego, you know, it's
just a full-on infestation. and so and
Austin and all. So they're coming to
market and I think they'll start, you
know, as we cons continue to see kind of
uh persistent downturns in travel and
that kind of thing that I that's just
going to accelerate. Um because these
things aren't making money and they're a
headache. I mean, being a landlord is a
headache. Um and so and Airbnb doesn't
care about you at all. Like they treat
you like dirt. So the they're they're
coming and you're seeing these like
motivated seller and I mean and you're
just seeing crazy crazy homes that
should have never been built come to
market in these in these uh in these
vacation spots. So
>> yeah, I'm thinking of the uh Airbnb we
stayed in when we visited Austin when we
were looking for a house in 2021. And I
don't think you could ever sell that to
somebody who would actually like want to
live in that as their their residential
property.
>> Did it have a theme?
>> It did. It did.
>> My favorite is the bananas theme in
Nashville. That property that like
there's so many of them though. Like
there's the Barbie castle. I mean
there's so many themed Airbnbs. I mean,
it's
it's just I think it's all this is just
an indictment of the federal government,
the central banks just printing money.
Like, you
become deluded into believing that a
banana themed Airbnb is a good idea,
>> right?
>> Something sustainable as a business.
>> Right. Right. And and I agree. I totally
agree. And I just what's crazy is and
you know the other thing though I try to
remind myself is when I just go out into
the world and I interview people on the
road or Uber driver or what they are way
more aware than uh finit of what's going
on and so I just kind of try to tell
myself okay you know we're dealing with
a certain group select group out there
in financial media that is you know a
lot of them are are uh in the ivory
tower of some sort and they don't really
understand what's going on. Um but the
regular Americans do.
>> Yeah. Yeah. In two years of like, oh, it
was completely obvious. Uh I just didn't
tell you about it.
>> Mhm.
>> Yeah.
>> Oh, exactly. Yeah. We could have never
seen this coming.
>> Okie dokie. I mean, it's just math at
the end of the day. I mean, the problem
is, you know, most of our data is
corrupt, so we can't even get to the
real math. Um
>> Yeah. How do we is there a fix to that
or is it something we just had to deal
with?
>> I don't I mean surely right like you
know this company Placer AI can tell you
how many cell phones are in one any one
city at any time. Are you telling me we
can't really figure out how many houses
we have in this country? I mean I just
don't I don't get that. Like and so
this a woman I met in Australia did a
really interesting study. She used the
utilities. shoes like the water company
to really get true inventory. Um, and I
try I've I've gone to a couple different
water boards to try to do that and it
it's harder over here than I think over
there. Um, but you know that it's just
we need real data. Um, but no, I think
that we are in full they are just
shoveling it right now. Just shoveling
it like none of this is is true,
accurate at all. And so I hope there is
a I mean I hope that we um I hope that
more people start standing up and
showing up at their city council
meetings and saying they're sick of this
and that and you know but it's it's
going to be us having to take
responsibility in my opinion.
>> Yeah.
No, it's funny to uh just recognize this
and Bitcoin obviously focused heavily on
CPI and um
I'm guilty of it. I'll put my hand up.
I'm guilty of it myself to a certain
extent, but like during Biden, you're
looking at the inflation rates. You're
like, "Ah, they're under reporting uh
because they're trying to mask
inflation." And now with Trump,
inflation rates coming down. Everybody's
like, "Look, look, it's working. It's
working." It's like, "Well, if the
metric was manipulated under the prior
administration, what's to make you
believe that's not manipulated under
this one?"
>> Right. Right.
>> What can you believe? What can we
believe these days? I think what you
see, you know, um, and even then, like
that's kind of funny. I remember after
Helen, people would argue with me about
something I'm reporting on that I'm that
was I saw it right in front of my face
and they're telling me I didn't see
that, you know, like, but I did, you
know, and I have a picture of it, but
it's still So, I mean, I think that
we're at a point where it's just um,
it's what we can see and then sort of
triangulate the data. I mean, I think
that that's what I really try to do is
like, okay, this picture in front of us
doesn't make sense. So, how can we put
one together like from the outside, like
frame a picture of what's actually
happening? Um, and I think when you can
do that, when you can kind of
triangulate the data and then you can
verify it by what you see with your own
eyes, I think that's how we, you know,
can sort of believe something's true.
>> Yeah. Yeah. Look out for the BTFP
program for the uh
>> I know
>> for the uh private equity guys in their
houses. I think that'll be a I think
it's a sly round about bailout.
>> I 100% I think the same about the Trump
homes. That's a builder bailout right
there.
>> Yeah.
>> I mean they're going to buy them at a
certain percent of you know median like
adjusted gross income. Like they'll say
okay you need it this to come I'll buy
it from you 25% less. They'll put some
price floor on it actually for these
builders and that is a bailout. But you
know these things tend to uh once they
get going there's you know they can try
and stop them. Um but the market force
just takes over.
>> Yeah. Well, we'll be observing. We'll be
watching. We'll be reading your
newsletter to follow along and hopefully
um
>> we can catch up on this at some point
later this year.
>> Absolutely. It's going to be an
interesting spring.
>> It really is. Melody, thank you so much.
Everybody, make sure you go subscribe.
M3_Melody
on Substack. Uh, we'll link to that in
the show notes and we'll uh we'll do
this again at some point later this
year.
>> Thank you so much, Marty. Thank you.
>> Thank you. Peace and love, freaks. Thank
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