Housing peaked in June 2022 as measured by the Case-Shiller index. We believe home values will continue to roll over as: 1.) banks continue to tighten; 2.) mortgage rates remain elevated (we don’t expect the Fed to pivot any time soon); 3.) unemployment moves higher; 4.) pricing for goods and services remains elevated versus 2020 (pre-COVID, pre-Money Printing).

• Last cycle, housing peaked in July 2006 and bottomed in February 2012. If history rhymes, we could be looking at a housing bottom in 2026-2029. Perhaps a bottom will rear its head sooner this cycle as consumer purchasing power has dramatically eroded due to the Fed’s money printing from 2009-2022, especially during the 2020-2022 period. As home values erode, so too shall other asset prices until of course the Fed decides to reinflate the bubble (hopefully the Fed never makes that mistake again).

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