This week in 1995, Alanis Morissette went to Number 1 with her album Jagged Little Pill, an album that spawned six number-one hits on its way to becoming the best-selling album of all time by a female artist. Heavy on drum machines, post-grunge philosophy, angsty slumber-party confessionals, and harmonicas, Jagged Little Pill’s main anthem is a little ditty called “Ironic,” which is anything but. Perhaps you’ve heard these famous lyrics from the song:
A traffic jam when you're already late.
A "No Smoking" sign on your cigarette break.
It's like ten thousand spoons when all you need is a knife.
It's meeting the man of my dreams, and then meeting his beautiful wife.
And isn't it ironic, don't you think?
Legions of Smarty Pants had fun pointing out that nothing in the song is ironic, but merely coincidence and unfortunate.
But a song about irony that isn’t ironic? Now we’re getting somewhere, my friends. The song has been spoofed too many times to count, updated to actually be ironic, and even Morisette herself poked some fun. But in the end, the original continues to serve tenth-grade English teachers across the land.
This month’s indicators are a lot like that—seemingly ironic, but more a set of unfortunate events. Take for instance, the drop in average weekly wages ($939/week) from last month’s highs while also seeing regional inflation creep up again (3.4%, year-over-year). The same is true with housing—prices have largely remained the same (outside of zip code 57701), while interest rates continue to rise.
This isn’t supposed to be how things work. As interest rates rise, inflation is supposed to be pummeled into submission. And housing should come down too. But when we dig into the data, we see that stingy gasoline costs are mostly responsible for the uptick in the inflation rate and the reason housing is still stuck at current prices is due to the fact that, even though builders are building as fast as they can in the region (622 units to date), housing inventories are still too low. And with more than 80% of homeowners locked into sub-5% mortgages, there simply aren’t loads of people willing to sell their current home and trade it in for a plus-8% mortgage on something else.
So, we’re in a bit of a wash cycle when it comes to the macro economy. And to think, just last month, economists were telling us there was the real possibility of a soft landing.
So much for that prediction. Maybe a bit ironic in an Alanis Morrissette kind of way?
Yeah, we really do think.
Stay safe and God-speed,
Want to see what's happening with the housing market? Be sure to check out the housing dashboard.
