Federal Reserve | timiacono.com - Part 55

We were driving for most of this week and I didn’t really get caught up much at night on the many goings on in financial markets – the silver flash crash on Sunday night followed by some more wild market moves in Japan and then the confusing word from the Fed via testimony by the Bernank, April meeting minutes, and various Fed speeches.

Gold Price

The gold price had some remarkable ups and downs, mostly while we were on the road and, between coming close to the Oklahoma tornado and then trying to find out what happened (and if we were in danger) the XM radio dial didn’t stay on Bloomberg News for very long (which is kind of unusual). This week in particular it seemed that markets have really become unhinged with traders fleeing equities as fast as they sold gold last month when it looked like the Fed’s money printing largess may soon come to an end.

It all kind of makes you wonder where this is all headed.

And … We are back

After missing the Oklahoma tornado by about 2 hours and 100 miles, we are now back home after logging about 3,700 miles on our trip to the Upper South (as detailed here).

I’m still trying to catch up on what’s been going on after some wild market moves, Fed news yesterday, and more wild market moves today. Didn’t catch any of yesterday’s Bernanke testimony, but Jim Grant offers some thoughts on the subject in this CNBC interview.

After, basically, taking the last month off due to travel, surgery, and then more travel, it should be back to normal here for the foreseeable future as I’m healthy again and all of our summer travel plans are relatively short and within a few hundred miles or so.

Peter Schiff of Euro Pacific Capital throws a wet blanket over Friday’s jobs report and new record highs for U.S. stocks in this appearance on CNBC last week.

There’s a lot to disagree with here such as another call for a dollar crash (against what?), but one interesting claim made early on is that part time restaurant hiring due to changing health care rules has made the job numbers look better than they really are.

Labor Department data shows that restaurant workers account for 7.5 percent of nonfarm payrolls but this group has contributed nearly 20 percent of the payroll gains so far in 2013 and data on part-time workers only shows up in the broader U-6 measure of “under-employment” that just rose from 13.8 to 13.9 percent as the narrower jobless rate fell.

Cheap Money and the Housing Rebound

Apparently, a strong housing market doesn’t really depend on people having good jobs in order to come up with a down payment and service a mortgage. Whether that strong housing market is healthy or not is another matter as detailed in this special report at Reuters.

The once-beleaguered Las Vegas housing market has been on fire since investment firms led by Blackstone Group LP, Colony Capital and American Homes 4 Rent began buying homes here some eight months ago, backed by $8 billion in investor cash to spend nationally.

These big investors and a handful of others have bought at least 55,000 single-family homes across the U.S. in the past year. In the Vegas area alone, they have accounted for at least 10 percent of the homes sold since January 2012, according to a Reuters analysis of housing transactions.

That added firepower helps explain why home prices in this metropolitan area of 2 million people are up 30 percent over a year ago, far more than the national average of 10 percent.

There’s lots more in this story, most of it disturbing such as 60 percent of Las Vegas home sales being all cash and a reminder that hot money from Wall Street doesn’t tend to stick around once the artificial appreciation stops – when that will be is anyone’s guess.

I missed the S&P Case-Shiller housing report earlier in the week where is looks like Las Vegas is about to overtake Phoenix as the nation’s hottest housing market.

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