US Housing

It will be interesting to see the effect the medium term effects the backup in bond yields has on the US economy. I find it alarming the fall in the refi index with such a relatively small rise in yields (1% approx). The housing market has been a bright spot for the US economy so any rolling over in this could be serious for market sentiment.

h/t Zerohedge

China Housing Bubble

I’ve long worried about Chinas housing bubble collapsing- parallels with the US sub-prime bubble are uncanny- negative real yields leading to the stampede into property and massive build-up in a shadow banking system. Two excellent charts from SoberLook show clearly the issue. Can the Chinese authorities bring about the fabled soft-landing? This will be hard even with 3.5 trillion in FX reserves.