LOCATION STRATEGY TOP 10 CHARTBOOK

Bank of America has revised its outlook for the US economy in favor of a soft landing, where growth falls below trend in 2024, but remains positive throughout the forecast horizon. The bank forecasts US GDP growth of 2.0% (4Q/4Q) this year, 0.7% in 2024, and 1.8% in 2025.

Following up on last week’s hidden stimulus story … US Federal Government Interest payments surged to $1 Trillion annualized.

The “secret stimulus” has brought Federal spending to crisis-like levels of 44% of GDP - about the same level of spending as WW2, and a percentage point higher than during the GFC.

The result of that spending is that US public debt is expected to rise to $52 trillion in 10 years - that’s adding more than $5 billion of debt per day.

And the payments on that debt are blowing out all other spending, starting with Defense spending in 2026.

At the same time Federal trust funds are reaching insolvency

Historically the Fed has stopped raising rates long before inflation returned its desired range.

Tightening Credit Conditions Are Creating Downside Risks for Industrial Companies

This is resulting in factory job losses:

The job market is still tight but the ratio of quits to unemployment rates have returned to normal.

Freddie Mac’ House Price Index reversed in June after never crossing zero in this cycle.

Meanwhile, the median sales price is above last year’s level

Rental vacancies are up this year, but homeowner vacancies hit a record low. The homeowner vacancy rate is defined as a proportion of homes that are for sale and vacant as a percentage of the total homeowner inventory.

Single-family rent inflation is slowing.

Americans aged 80 years and older in the workforce: