WHY THE FED'S "TRANSITORY"REMARK IS TOTAL DELUSION

Well so much for the Fed's "everything is transitory remark".
Housing starts plunged -5.5% in May vs +4.1% expectations. Housing permits also missed expectations, dropping -4.9% vs +1.7% expectations.
Not only that, the housing starts data was also revised lower in April and March .
How can it be transitory if it happens for 3 months in a row? With April and May being in Q2? (See chart below, source: Zerohedge).
Most likely Q2 GDP is going to take a hit.
Meanwhile look out for the collapse of the US auto industry as car sales drops despite the additional discounts offered.
Just read today form Zerohedge that they (the auto dealers) consider leased vehicles as sales to boost up car sales data. What happens when the leased vehicles are returned?
Already used vehicle price is being depressed.
More than 30% of the US$1.1T car loans are subprime and delinquency rate is rising.
Financials institutions are repackaging subprime loans, slicing and dicing them and offering them as mortgage backed securities to investors starving for yields.
Have the bankers learned nothing from the crisis in 2008? Well as long as the Fed is supporting them and the narrative of too big to fail remains, who bothers about the risks anyway.
Look out for news of the auto makers suspending production or laying off workers. That will be signal of a massive fallout in the industry.
The recent drop in the tech sector is an indication that things have become frothy.
As the US nears the coming financial hurdle of another debt ceiling debate, which this time the Democrats have issued a warning that they will fight the extension tooth and nail, it could get very ugly for the stock market.
By the way, the US is sending more troops to Afghanistan, and according to reports that is going to be another few thousands more. Already the US deficit up to May is higher than the previous year yet they are spending even more on war.
Th Afghan war is now in its 16th year. If the US could win it would have already won it. The British tried in the 1800s and failed, The Russian tried in 1980s and failed too. That is a nation that no one should mess with.

ANOTHER