“Big doesn’t necessarily mean better. Sunflowers aren’t better than violets” — Edna Ferber
Chart of the Day
Good morning!
In the 1980s, a popular ad campaign told consumers that “owning a home of your own” was the American dream. That ad campaign was quite convincing, and in subsequent decades, home ownership was touted as a way to build wealth and achieve happiness. For many, it worked.
But is it still? As the years have passed, the American dream appears to have gradually shifted from owning one’s own home to owning a big home. Since the 1980s, the average size of a single-family home has gone from 1,700 square feet (158 m2) to about 2,495 square feet (231.8 m2) in 2019, according to U.S. Census data. Unsurprisingly, much of that increase in square footage has come in the form of more bedrooms. As houses got bigger, they also got fancier – larger kitchens, high-end appliances, spa-like bathrooms, and other amenities.
These upgrades don’t always get used to their fullest. For example, a study by realtor.com shows that if we compare the number of people living in a house to the number of bedrooms, empty bedrooms are at a record high.
That wouldn’t be a big deal, if homeownership had resulted in added, usable wealth for households. Increasingly, however, the growing value of American homes isn’t doing that. Tighter lending standards and higher rates are making it more difficult for owners to either sell their homes or borrow against their home equity, and in cases in which property values have risen significantly, potential capital-gains taxes have made owners even more reluctant to sell. In essence, for many, that oh-so desired home has become a burden.
Perhaps exacerbating the situation, a January 2025 study suggests that preferences might be starting to shift: younger generations of homebuyers are increasingly looking for smaller homes, and not the spacious, derisively named McMansions of yesteryear. In addition to evolving tastes, this trend also makes sense in a way because the birth rate has declined, reducing the need for homes with extra bedrooms for children.
Meanwhile, empty bedrooms aside, those bigger, higher-value homes are actually leading to ever-increasing expenses, like rising property taxes and maintenance costs.
That leads to a question not unlike the Zen koan about trees falling in a forest: if a home rises in value but its owner’s spending power doesn’t, has its value really risen?
Editor’s Note: There will be no First to Market tomorrow on account of Good Friday. We hope our readers have a good long weekend.
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Catch up with FS Insight
Our overall takeaway is that this pullback is disappointing (but not surprising) and markets are in a much better place Wednesday compared to 4/7-4/8 last week when the S&P 500 was probing 4,800.
Technical
Going forward, SPX 5500, QQQ-466.43, and DJIA-40,661 remain key areas to exceed to have confidence, and these likely are tested and exceeded sometime this week.
Crypto
We discuss how bitcoin’s persistent Coinbase premium signaled strong U.S. spot demand during a Powell‑triggered stock selloff, how gold’s record run might be seeping into crypto, and why Janover’s fresh capital is a tailwind for SOL.
News We’re Following
Breaking News
- Trump blasts Fed Chair Powell, saying his ‘termination cannot come fast enough’ CNN
- ECB cuts rates to 2.25% amid Trump trade war FT
Markets and economy
- What Economists See Ahead—and How They Fared Last Year WSJ
- Trading in two stocks surged before Trump family appointments announced FT
- With fear gauge echoing 2022 turmoil, here’s a new theory on when Trump will change course MW
Business
- UnitedHealth Shares Tumble After Earnings Fall Short Due to Medicare Issues WSJ
- Target CEO Cornell to meet with Sharpton to discuss DEI rollback as civil rights leader considers boycott CNBC
- Eli Lilly’s weight loss pill succeeds in first late-stage trial on diabetes patients CNBC
- TSMC sticks with its revenue forecast after profit tops estimates despite Trump trade worries CNBC
Politics
- Trump Administration Asks IRS to Start Process to Revoke Harvard’s Tax-Exempt Status WSJ
- Meloni, Europe’s Trump Whisperer, Tries Her Hand on Tariffs WSJ
- Judge Threatens Contempt Proceedings Over Deportation Flights to El Salvador NYT
Overseas
- Turkey’s central bank surprises with 350-basis-point rate hike CNBC
Of Interest
- Astronomers claim strongest evidence yet of extraterrestrial life FT
- Jensen Huang is visiting China. The Nvidia CEO is caught in a trade war. MW
- Chinese Tea Chain CEO Becomes a Billionaire at 30 After US IPO BBG
| Overnight |
| S&P Futures +48
point(s) (+0.9%
) Overnight range: -12 to +66 point(s) |
| APAC |
| Nikkei +1.35%
Topix +1.29% China SHCOMP +0.13% Hang Seng +1.61% Korea +0.94% Singapore +1.58% Australia +0.78% India +1.78% Taiwan -0.66% |
| Europe |
| Stoxx 50 -0.5%
Stoxx 600 -0.52% FTSE 100 -0.71% DAX -0.26% CAC 40 -0.57% Italy -0.35% IBEX -0.45% |
| FX |
| Dollar Index (DXY) +0.13%
to 99.51 EUR/USD -0.21% to 1.1375 GBP/USD -0.02% to 1.3241 USD/JPY +0.59% to 142.71 USD/CNY -0.04% to 7.2966 USD/CNH +0.01% to 7.2997 USD/CHF +0.47% to 0.8171 USD/CAD +0.2% to 1.3887 AUD/USD -0.25% to 0.6355 |
| Crypto |
| BTC +0.21%
to 84486.96 ETH +1.42% to 1595.96 XRP +0.17% to 2.0977 Cardano +0.85% to 0.6172 Solana +1.68% to 133.86 Avalanche +2.66% to 19.26 Dogecoin +0.77% to 0.1564 Chainlink +1.44% to 12.46 |
| Commodities and Others |
| VIX -5.91%
to 30.71 WTI Crude +1.04% to 63.12 Brent Crude +0.9% to 66.44 Nat Gas +0.46% to 3.26 RBOB Gas +0.59% to 2.056 Heating Oil +0.18% to 2.119 Gold -0.59% to 3323.31 Silver -1.26% to 32.35 Copper -2.23% to 4.581 |
| US Treasuries |
| 1M -3.0bps
to 4.254% 3M -2.0bps to 4.2865% 6M -0.7bps to 4.169% 12M +0.7bps to 3.9501% 2Y +3.9bps to 3.8087% 5Y +4.5bps to 3.9486% 7Y +4.7bps to 4.1194% 10Y +3.5bps to 4.3113% 20Y +3.2bps to 4.8061% 30Y +2.9bps to 4.7677% |
| UST Term Structure |
| 2Y-3
M Spread widened 3.9bps to -51.1
bps 10Y-2 Y Spread narrowed 0.5bps to 49.8 bps 30Y-10 Y Spread narrowed 0.4bps to 45.5 bps |
| Yesterday's Recap |
| SPX -2.24%
SPX Eq Wt -1.28% NASDAQ 100 -3.04% NASDAQ Comp -3.07% Russell Midcap -1.25% R2k -1.03% R1k Value -1.14% R1k Growth -3.03% R2k Value -0.49% R2k Growth -1.55% FANG+ -3.25% Semis -4.22% Software -2.41% Biotech -1.84% Regional Banks -0.02% SPX GICS1 Sorted: Energy +0.8% REITs -0.16% Materials -0.77% Utes -0.93% Healthcare -1.0% Cons Staples -1.15% Indu -1.38% Fin -1.57% SPX -2.24% Comm Srvcs -2.48% Cons Disc -2.69% Tech -3.94% |
| USD HY OaS |
| All Sectors +6.9bp
to 457bp All Sectors ex-Energy +7.7bp to 410bp Cons Disc +10.1bp to 453bp Indu +10.2bp to 347bp Tech +8.1bp to 450bp Comm Srvcs +9.6bp to 637bp Materials +12.9bp to 443bp Energy -10.9bp to 506bp Fin Snr +7.4bp to 386bp Fin Sub +2.2bp to 303bp Cons Staples +4.5bp to 300bp Healthcare +7.4bp to 468bp Utes +4.8bp to 314bp * |
| Date | Time | Description | Estimate | Last |
|---|---|---|---|---|
| 4/23 | 9:45AM | Apr P S&P Manu PMI | n/a | 50.2 |
| 4/23 | 9:45AM | Apr P S&P Srvcs PMI | n/a | 54.4 |
| 4/23 | 10AM | Mar New Home Sales | 682.5 | 676.0 |
| 4/23 | 10AM | Mar New Home Sales m/m | 1.0 | 1.8 |
