Tag Archives: Citadel

The Real State Of The Economy

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Remember when owning your house was something of a hedge against inflation? When everything else fell apart, at least your house maintained its worth and you had a place to live. Well, it seems as if President Biden is even threatening that small amount of stability. First the administration changed the mortgage rules to penalize people with good credit ratings (article here), now higher interest rates are beginning to slow down the housing market.

On Thursday, The Conservative Treehouse reported the following:

As higher interest rates continue to put pressure on borrowers, the ability of the average person to afford a mortgage diminishes. Higher mortgage rates lead to downward pressure on residential home values as fewer borrowers can afford higher payments. Simultaneously, commercial real estate is dropping in value as vacancies continue increasing.

Put both of these issues together and already tenuous banks holding mortgage bonds as assets can become more unstable.

…A perfect storm starts to realize.

(Wall Street Journal) U.S. existing-home sales decreased 2.4% in March from the prior month to a seasonally adjusted annual rate of 4.44 million, the National Association of Realtors said Thursday. March sales fell 22% from a year earlier.

March marked the 13th time in the previous 14 months that sales have slowed. The housing market had a surprisingly strong February, when sales rose a revised 13.75% from the previous month. But after mortgage rates ticked higher, March sales resumed the extended period of declines.

The housing market’s slowdown is now starting to weigh on prices, which have fallen on an annual basis for two consecutive months for the first time in 11 years. The national median existing-home price decline of 0.9% in March from a year earlier to $375,700 was the biggest year-over-year price drop since January 2012, NAR said.

Median prices, which aren’t seasonally adjusted, were down 9.2% from a record $413,800 in June. Home prices in the western half of the U.S. experienced some of the biggest gains for many years but are now falling the fastest.

[…] Housing starts, a measure of U.S. home-building, fell 0.8% in March from February, the Commerce Department said this week. Residential permits, which can be a bellwether for future home construction, dropped 8.8%.

The housing market slowdown shows one of the main ways that the Fed’s aggressive interest-rate increases are rippling through the economy. Housing is one of the most rate-sensitive economic sectors, and high housing costs have been a big contributor to inflation.

The article concludes:

As mortgage rates rise, just as a consumer would pull back from the housing market, so too will institutional investment groups now control the slow dumping of the asset to remove the equity they pumped into it.  Much of the investment housing will be retained as rental housing, with the monthly rents being part of the returns on the investments.    However, as this dynamic unfolds further investment purchases of houses stop, because the asset overall is declining in value.  This halt of investment activity also worsens a steeper drop in home values.

Notice this line within today’s WSJ article: “The housing market had a surprisingly strong February, when sales rose a revised 13.75% from the previous month.”

What happened in February?  The BIG CLUB [Blackrock, Vanguard, Citadel, etc.] moved liquid assets out of banks into hard assets (real estate), to avoid a predictable banking issue which surfaced a month later in March.  They knew what was going to happen in banking, they moved their own assets to avoid it.

I am not sure that the American economy can survive the Biden administration’s economic policies. Even if you hated President Trump, the impact President Biden has had on stock portfolios, real estate values, the price of gas, etc., has had a serious negative impact of the middle class.

A College That Has Chosen To Follow The Law

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Yesterday The Daily Signal reported the following:

The Citadel, the public military college in Charleston, South Carolina, has announced it will require all cadets to complete a class on the U.S. Constitution and other founding documents beginning in the 2020-21 academic year.

The article notes that South Carolina has a law requiring teaching of the Constitution and other founding documents that has been in place for 96 years.

The article reports:

The Citadel’s decision to comply with the law is in stark contrast to most other colleges in South Carolina that have flouted and balked at the law.

For example, the University of South Carolina—the state’s largest public college—called the law “archaic” and refused to comply with it. The university said a required class on the Constitution is too financially burdensome—yet somehow manages to finance classes on the history of the devil and Tailgating 101.

Instead of complying with the law’s mandate of a yearlong class, the University of South Carolina said it hands out pocket Constitutions on Constitution Day. The university has not said whether a student can pass Tailgating 101 by being handed a hot dog at a football game.

Similarly, Clemson University—the state’s second-largest public college—pretends to comply with the law by requiring students to watch a one-hour video about the Constitution as a single module within its freshman diversity class. Clemson claims the video is a sufficient equivalent to the law’s mandate of a yearlong class.

Concerned about the “optics” of breaking state law, Clemson has sent taxpayer-funded lobbyists to the state Legislature to “kill” the requirement to teach the Constitution.

Has it occurred to any of the esteemed college presidents who choose not to follow the law that one of the reasons for the lack of appreciation for the freedoms we enjoy as Americans might be the lack of knowledge of the Constitution and the the founding documents of America? Has it occurred to any of the esteemed college presidents that their students have no idea of the price the signers of the Declaration of Independence paid for their signatures on that document?

I am the daughter of a Clemson graduate who attended the school when it was a military college. When my father graduated, he was shipped to Europe as part of the D-Day landing. That is the heritage of Clemson. They need to remember that heritage and teach what their graduates fought for.

This Is Understandable But Scary

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Yesterday the Daily Caller posted a story about a group of people organizing a community in Idaho. Doesn’t sound like news–builders construct golf communities, retirement communities, etc., all the time, but this is radically different. The community is called the Citadel.

The article reports:

Citadel organizers envision their project to be a community where residents are bound by a desire to “live together in accordance with Thomas Jefferson’s ideal of Rightful Liberty,” which they have determined to mean “that neighbors keep their noses out of other neighbors’ business, that neighbors live and let live.”

“Marxists, Socialists, Liberals, and Establishment Republicans may find that living within our Citadel Community is incompatible with their existing ideology and preferred lifestyles,” the group — which claims no leader other than the “ideal of Jefferson’s Rightful Liberty” — explains on its website.

There are a lot of aspects of this community which frighten me. The article further reports:

The plans for the community — which they expect to build in Benewah County, Idaho, starting this summer — include at least 2,000 acres surrounded by a defensible perimeter that is “inaccessible to tourists.” Each neighborhood will also have separating walls “dividing the town into defensible sections/neighborhoods.”

What is the community planning for the relationship between the Citadel and its surrounding communities? Are state and federal authorities given the appropriate authority within the community? How does the community plan to handle legal matters? What prevents a small group of petty tyrants from taking over the community and turning into a place it is impossible to leave?

Maybe I have been reading too many conspiracy novels lately, but I think the risk here outweighs the benefits. I personally would prefer to take over my own private desert island and sit under the palm trees drinking drinks with little umbrellas in them. I think that is as likely as the success of this community.

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