This month in 1980, Stanley Kubrick's The Shining hit theaters and showed that while some men might seem cool when you meet them, below the surface lurks one crazy hombre. The plot is simple enough: writer Jack Torrance (played by the great Jack Nicholson), takes a winter caretaker job at the Overlook Hotel, a gorgeous mountain resort in the Rockies, so he can avoid distraction, stay sober, and finish his long-anticipated novel. In tow is his wife Wendy (played by Shelly Duvall) and his son Danny, who just happens to have telepathic abilities the size of Texas.
Suffice to say, things don’t go to plan (do they ever?). Torrance slowly descends into madness due to his nagging wife and nagging writer’s block. He also seems to have developed a case of cabin fever and combines it with a nervous breakdown and a penchant for violent outbursts and shots of expensive bourbon. As the film progresses, Torrance falls off the wagon and decides it’s time for everyone to die—that is, with a little help from his hallucinations. By the end of the story, Torrance goes insane, grabs an ax, chases his wife through a hedge maze in the dead of winter, and finally, freezes to death. And they say alcohol warms you up.
The moral of the story? Don’t become a writer.
The most famous scene in the movie is also an American cultural touchstone. Jack Nicholson screams some scary nursery rhymes and yells “Here’s Johnny!” as he chops through a a bathroom door to get to his frightened wife. Meanwhile, his son keeps finger-puppeting 'redrum' like a teenage doom scroller. Spell it backwards and spoiler alert: it doesn’t mean ‘Happy Ending’.
This month’s economic indicators are a lot like that. Everything looks like a relaxing family winter vacation on the surface, just like the Overlook Hotel, but the deeper you go, the more you realize, it all ends in hell and ice. Take for instance job numbers, wages, gross sales, labor force participation, and airport passengers. All show a surface-level robustness that any healthy economy would. But below that we’ve also seen a weakening on the residential real estate front. Active listings were 56.3%, while days-on-market increased to 52 days (up 29.8%).
Additionally, building permits dropped from 286 to 217, and new housing permits also plunged from 71 to 13. Building valuation fell from $65 million to $31 million, suggesting contractors took one look at the market conditions and interest rates and decided they might want to wait for a sequel. The small bit of good news is that it’s caused housing prices to drop in both the 57702 and 57703 zip codes.
On the national front, your guess is as good as telepathy. What we do know is that inflation is still with us (3.1%, year-over-year), and, although the Prime Rate moved down a quarter of a percentage point at the time of this writing, tariffs are still so volatile, it’s like a swing from the ax of a madman with anger management issues.
Will the market crash? Who knows. We know that it’s definitely overheated and at levels of valuation not seen since the year 2000. But we also know that the stock market isn’t the real economy either. The real economy, the one you and I buy stuff in, is also flashing warning signals. When more people are crowdfunding their groceries than ever before, it’s not a great sign. At best, let’s just say it’s as complicated as an interview for a winter caretaker at the Stanley Hotel. At worst, we're all just typing 'all work and no play' over and over while pretending everything's fine.
Stay safe and God-speed,
Tom
