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So what are we going to be discussing on this episode? We're going to, of course, be starting out with NVIDIA, huge earnings report this week. We want to talk about the AI arms race as well. Berkshire joining the Trillion Dollar Club, huge milestone there for Berkshire Hathaway. The return of sound money, we're going to be talking about money supply.
the trend over the past few years which has been moving in the right direction shrinking salaries is an interesting data point out of zip recruiter perhaps another sign that the labor market is cooling double the down payment that would be talking about the housing market and the big change over the past few years and related in the housing market is the lock-in effect starting to ease is a huge question that's going to affect activity prices over the next few years and will end as we always do with something positive and that would be more affordable rents okay let's start out with that huge nvidia earnings report price for perfection and that's what would be nvidia's situation heading into earnings i talked about it last week just enormous advance on the year heading into that earnings report expectations were extremely high meaning that it not just had to beat it had to really beat those consensus estimates in order to see a pop in terms of the share price And if you look at the actual numbers, they seem pretty good here. We're talking about $30 billion now in revenue, another record quarter. And you can see here just the exponential rise in revenues in recent quarters.
You went from $13.5 billion here to $18 billion, $22 billion, $26 billion, and now $30 billion. And they're expecting that growth to continue in the third quarter, moving up to $32.5 billion. And the estimate was $28.7 billion.
So that's technically a beat but supposedly the whisper number what people really were expecting was higher than this looking at 32 33 maybe even 34 billion so depending on which number you're looking at it was either a disappointment or a beat but we'll talk about what the stock did and i think that tells really the story and if we're looking at revenue growth on a year-over-year basis this shows you that nvidia is now in a different phase so we had that acceleration phase We're just seeing tripling of its revenue on a year-over-year basis. And now we're starting to move down, still up 122% over the past year. So still an incredible number.
But this growth rate obviously is not sustainable, likely to continue to decelerate as we're looking at the next year. And if that next quarter number comes in at $32.5 billion, we're looking at a 79% year-over-year increase. If we look at the bottom line, looking at net income, stunning increases here.
Looking at $16.6 billion for just the last quarter, that's another record high. That was 168% higher than where we were a year ago at $6.2 billion. But again, the expectation is that number, that percentage increase on a year-over-year basis is likely to move lower in the coming quarters. If we look at profit margins, I would say this is what a lot of people are pointing to in terms of, okay, maybe they're starting to feel...
the effects of some competition and they don't just have ultimate pricing power in terms of charging whatever they want perhaps costs are becoming an issue as well whatever the reason we're seeing a slight decline in profit margins they peaked out at 57 very small move lower 55 but notice notable because we had just been seeing not only revenue expanding net income expanding but increasing profit margins as well so still of course highly highly profitable at 55 but if this number is going to come down that's a different situation in terms of valuing the company if profit margins are going to move lower, especially if that's due to competitors coming into the market. This is the reaction that matters here in terms of what were the actual expectations. I would say they were much higher than what we saw in terms of the results. And the reason I'm saying that is we saw prices come down for the stock here, only down a few percent, but notable that we didn't see a spike higher, even though these numbers are course were incredible and i think a big part of that is just what had happened heading into that report so you're looking at like 160 percent gain on the year heading into these numbers still up 138 percent so still an enormous enormous advance and at a certain point valuations have to matter and that is still the big question for nvidia trading at 56 times earnings 31 times sales can it continue to grow into these numbers at this point. And what we were saying a few months ago is looking at NVIDIA was up, I think, around 170% a few months ago on the year at its peak.
And even with the expectation that its revenue is going to double this year up over 100%, that was far ahead of that revenue growth. So prices were going up well in advance of underlying fundamentals, meaning multiple expansion was explaining. a lot of the move for Nvidia.
So the big question, of course, is at the current multiple here, is it going to continue to grow at the rate that it needs to in order to justify that multiple? So let's say Nvidia doubles over the next year in terms of revenue. I don't think that's the expectation. It's not really likely. Well, that would still leave you assuming no price increase at a price to sales ratio of 15 times, which is still be ahead of the other names here.
in the magnificent seven so certainly expectations still very high for nvidia i think it obviously has to produce in order to maintain the current valuation that it has and we'll well there's so many factors that go into it that it's impossible to say but what we can say is we've never seen a company in history do what nvidia has done in terms of the share price appreciation in terms of the fundamental growth that we've seen over the past few years. We've never seen anything like it for a company this size. Okay, let's talk about something related here, the AI arms race.
And this is the notion that big tech is spending just tons and tons of money, obviously a big part of it going to Nvidia and going to these chips here that are going to power the future for AI. And if we look at CapEx spending, I think a big part of this story. is that spending on AI.
And we're looking here at Google, Amazon, Microsoft, and Meta, the increase in CapEx spending over the past year. And you can see huge, huge increases in terms of spending here. Google, 64% increase.
Amazon, 41% increase. Microsoft, 40% increase. And Meta, 23% increase. And if we look at some of the comments here that their CEOs or CFOs have made, about this spending, you can see that they're saying that they need to do this to get ahead of their competitors.
If you look at Google here, this was a big one when Sunder Pichai said, when you go through a curve like this, the risk of under-investing is dramatically greater than the risk of over-investing. And the comments are similar from other CEOs looking at Zuckerberg here. At this point, I'd rather risk building capacity.
before it's needed rather than it's too late so the idea is they have to spend all this money now now the big question is well is this going to translate into profits or increasing profits for these companies and perhaps if it doesn't then these companies are priced too high because the expectation is that it will so so far a lot of the profits have gone the rewards have gone to nvidia the supplier of this boom in terms of these chips, but we haven't yet seen it in terms of the actual companies who are building out this infrastructure, showing that AI has delivered in terms of the bottom line. So the question is, are they overspending in this area? We're only going to know in a few years, but it seems to be for now, we're in the part of the cycle where they're saying, if they don't spend this money, they're at risk of falling behind their competitors, and that will be even worse for the company.
than overspending now this is where it becomes a question in terms of expectations for the broad market so we're talking about nvidia being priced for perfection and if we look at the s p 500 Not that far off from that in terms of this being a concept for the broad market, because as we talked about, stocks broadly based here, looking at US S&P 500 stocks, not cheap. If we're looking at price to peak earnings ratio, we're at the highest level since 2000, not at the exact same level, still a little bit below there. But we're talking about almost 50% above the historical median in terms of price to peak earnings.
And if we look at price to sales here, you can see almost back to the peak that we saw in 2021 before we had that bear market retreating with the S&P 500 about 2.9 times sales. We peaked back in 2021 at three times sales. So certainly whether you're looking at price to earnings or price to sales, expectations are extremely high. And I think a big part of that is the expectation that this AI spending is going to translate into a big boost in terms of profits. If we look at S&P Dow Jones, I just want to show you here their expectations for the next year and a half here in terms of earnings, operating earnings.
And you can see here this dark blue line, huge increase. So they're looking at going from 219 times earnings, operating earnings over the last four quarters to $277 in terms of operating earnings by the end of 2025. So you're looking at about a 25 increase between now and the end of 2025 at least that's the expectation from s p dow jones so to me that is very very high that would certainly be well above the six percent historical earnings growth rate for the s p 500 so the question is is this achievable if it is then perhaps this chart over here and this chart over here showing that valuations are elevated you could say well, then maybe it's justified because if we see that 25% increase in earnings, then stocks will grow into that valuation. But if it falls short, and my expectation is it'll likely fall short of this number. I think that number is too high.
It's a question of how much. If it falls short, then is the market going to have a reality check in terms of, okay, we've spent all this money on AI build out on the arms race. but we're not yet seeing it in terms of profits.
And all of this assumes that the economy doesn't turn down between now and then. We're not going to see slower growth. So we had the late 90s boom, the build out in terms of the internet there, and what no one was pricing in at the end of 1999 and in 2000 was a recession that we saw in 2001, which really brought down spending in terms of capex. So the question here won't be answered for a few years but we know one thing we know that a lot of these stocks are being priced for perfection the market as a whole certainly on the higher end of things so expectations very high and they're going to have to meet these expectations they're going to have to do essentially what nvidia did in order to justify current valuations okay number three berkshire joins the trillion dollar club huge news for berkshire hathaway buffett just turned 94 this week so incredible uh to see uh he's lived to the point where berkshire is now a trillion dollar company the seventh company in the s p 500 now today with a market cap of a billion or more and you can see over the past five years its market cap has actually doubled so going from a little bit less than 500 billion to over a trillion in just five years so huge growth and this has happened this year in spite of the fact that we've talked about berkshire hathaway's cash pile continues to grow at a record high. Huge spike last quarter.
Doesn't seem to be hurting the stock whatsoever. Looking at Berkshire up 32% year to date versus around 19% for the S&P 500. So big outperformance this year. And so if we look at the companies that are now a trillion or more, Berkshire obviously in a different space where all the rest of them, tech companies, you got Apple, Microsoft, Nvidia, Google. Amazon and Meta, and then Berkshire Hathaway at a trillion and Eli Lilly getting closer here as well in terms of healthcare.
And what we're talking about for Berkshire is really a fundamental story, first and foremost. If we look at the top companies in terms of net income, you can see here, Berkshire Hathaway, fourth on the list, 68 billion in net income over the last year. That puts it at roughly 15 times earnings. So not... out of line certainly below actually the market's multiple for the s p 500 actually well below it so you would say it's justified based on earnings probably and based on revenue as well looking here at berkshire number three in terms of revenue companies in the s p 500 and i think this is an interesting stat in terms of the relationship between number of employees and the market cap big divide between companies like nvidia and companies like walmart here which is still number one in terms of revenue just in terms of what are the num what's the number of employees that are required to produce a level of sales or a level of earnings or for the market cap and the the way i like to look at it is take that market cap and divide it by the number of employees and see what you're getting for per employee in terms of valuation for uh for that market cap and nvidia you can see here is another way of looking at expectations being very high and the expectation that those fat profit margins are going to continue is the fact that nvidia is in a class by itself 97 million dollars per employee is the current market cap for nvidia and you can see netflix down at 23 apple 22 eli lilly 20 meta 19 microsoft 13 google 11. so no one even close to nvidia in terms of this and of course this is because it's just having that outsized profit margins that huge acceleration in terms of net income and sales and they haven't had thus far to add many more employees in order to ramp that up which is pretty incredible uh Testament to Nvidia is this sustainable probably not and I would expect this number to come down either they will have to add more employees or you're going to see that market cap value come down if those expectations were too high but interesting to see the divide between Nvidia at 97 million per employee and Walmart down on 290 000 per employee.
Amazon as well, 1.2 million. The median for the S&P 500, 1.7 million. So it just takes many more employees at a company like Amazon to generate a level of sales or a level of earnings than a company like NVIDIA, very different businesses.
And that would suggest that NVIDIA should trade at a higher multiple. The question is, well, how high is too high? Okay. Number four here, the return of sound money.
So I got a lot of questions last week after. i discussed the fed i discussed their notion that uh things outside of their control really are driving inflation over the past few years and they never mentioned money supply and never mentioned deficits they never mentioned the national debt which in my view are the big elephants in the room that are really driving the inflation picture and so people a few people reached out asked well why has inflation come down if money supply hasn't come down. And you know, the money supply is higher than it was five years ago.
So why is inflation rate lower today? Why is it trending lower? Well, it's not just the absolute level of money supply.
It's the rate of change of that growth. As we often show here, this chart is looking at year over year changes in the money supply. And this is looking at M2, you could see that record spike in terms of the money supply growth in 2020 and 2021. It was up to around $1.5 billion. 27% year over year, something we've never seen in history going back to 1960 in terms of this data. That was a big tell in terms of what would happen in terms of inflation.
When you print that much money, you're going to have inflation. The question is how much. And we got the highest inflation since the early 1980s in part as a result of this. Of course, the other part would be the huge increase in national debt and deficit spending.
But as we talked about uh the fed got religion they they understood even though they don't talk about it they understood that this was unsustainable this was a crazy increase and they had to start normalizing things unless they wanted to have run a rate want to run away inflation for years to come and they pulled back so if we look at the uh picture here in 2020 2021 there was a 40 increase in the money supply in just those two years That we had never seen before in history. Then we had the inflationary spike with a lag in 2022 up to 9.1%. And then they slammed on the brakes.
They stopped. They stopped printing money. Money supply actually contracted in 2022 and 2023. And so far this year has only increased 1%. So they've gone back to essentially flatline.
And this move lower really has forecasted the... lower rates of inflation that we're seeing today. And so if we look at the historical average in terms of increases in the money supply, 6.9% per year, we're still below that level, even though we're starting to trend up a little bit, we're still below that level.
So my expectation is we'll still see CPI continue to trend lower as well, as I'll talk about in a little bit. And this is the chart I think that matters for that next CPI report. It's the fact that we're dropping off the big number from last August up 0.5%, and it's likely to be replaced with a number much lower. So if we're looking at, let's say, a 0.2% increase for August, maybe even come in below that, that would mean the inflation rate over the last year, if you take the 12 months here, will only be 2.6%. So we had 2.9% in July.
This could drop to 2.6% in August. And that would be the lowest rate of inflation that we've seen in the US since early 2021. And one of the big reasons for that is the return to sound money. And I really hope this continues and we don't go back to this crazy period of money printing. Now, if we look at core PCE, we got new data today and the trend has been lower. But last few months, we've kind of gone sideways at 2.6%.
People are wondering, well, what will this... change what the Fed is going to do? I don't think so. I think the Fed has already made up their mind.
They're going to cut rates in September. According to the Fed, this is low enough, even though their target is 2%, even though we've gone well above that 2% level over the past few years. So the Fed, they're saying, we don't have to get to 2%. 2.6% is close enough for us to start normalizing policy. And I think the reason for that...
is they're starting to see a slowdown in the labor market and number two is they have room to cut here so we're looking here at the relationship between the fed funds rate and that core pce level which is their preferred measure of inflation and you can see this spread here this indicates that monetary policy is tight and you can see it's the tightest it's been since september 2007. so in the fed's mind i think they're saying well does it have to be this tight if inflation is trending lower and they're going to error on the side of easing before the labor market really cool so they're trying to game this thing no human being can do this we've seen the fed do it wrong time and time again they're going to do it wrong again because they can't determine what the rate of interest should be for this economy you can see clearly they had no understanding of this for this entire period from 2008 to 2015 when they held rates at 0%, well below the rate of inflation for all that period of time. What was the justification for that? I don't think there is one.
So the idea that the Fed knows this magical percentage that that interest rate should be better than the free market doesn't make sense to me, but this is the game that we play. And the game is going to be that the Fed's going to cut interest rates for the first time since 2020. and they're likely in my mind to do a 25 basis points cut so real interesting we have the tightest monetary policy we've seen in the us since september 2007 and guess what happened back in september 2007 well the fed started their interest rate cutting cycle it actually did a 50 basis point cut that month and a little over a year later you can see here the fed would go all the way down to zero and why was that well we had a financial crisis We had a deep recession, worst recession since the Great Depression. So I'll say it again here.
You don't want to see the Fed aggressively cutting interest rates in the next year. The expectation now is the Fed's going to cut about 200 basis points in the next year. And if they end up doing much more than that, I don't think it's just going to be because inflation is benign. I think it's going to be because they're seeing a recession or we're already in a recession. That recent history would have showed.
that that's the case especially if they're going to move back down to this ultra easy stance i think all that only comes with recessionary data so be careful what you wish for don't want to see interest rates collapse here you don't want to see the fed cutting 50 basis points i don't think at the next meeting or the next few meetings because that will mean that the economic data is much worse than anybody expected this is the current probabilities in terms of fed funds rate looking at fed funds futures now Market is leaning towards that 25 basis point cut. Now we have a few weeks until the meeting. We're looking at September 18th.
We're going to get the payroll report next week. We're going to get the CPI report the week after. Don't think. either one of them is going to have a enough of an impact to change this my expectation is still the fed wants to start out slow here they want to start out with that 25 basis point cut and if we see that expectation heading into that meeting that's exactly what the fed will do okay number five here additional data point showing a cooling labor market perhaps interesting uh report from the wall street journal and zip recruiter showing that looking at new jobs, so new job postings, if you're looking at the pay for those jobs, it seems to be lower than it was a year ago.
That doesn't mean employers are paying their workers less or cutting current employees'wages. It means that they're listing lower-end jobs. They're listing in areas where you have lower wages in general in terms of the country. But looking at this data here, they looked at 20,000 different job titles. a number of sectors here looking at retail agriculture manufacturing looking at these job postings versus a year ago you can see declines pretty much across the board in terms of these categories and they're talking about this being for a lot of blue collar jobs where in last year we talked about this data really affecting white collar jobs so just another data point showing likely a cooling of the labor market again this doesn't mean existing employees that their wages are going down.
They're still going up, but the rate of change is slowing because you're seeing that dynamic between job openings and people looking for jobs and the number of unemployed. All of that is normalizing in terms of the labor market. Supply and demand is normalizing and there's no longer a huge need for employers to pay people. these exorbitant salaries when they're coming in and give these huge bonuses and other things in order to get them into the company because they're labor, they need just need workers.
So that seems that notion seems to be gone. We've refilled a lot of these jobs, which is obviously a good thing. But we're going to see this hourly earnings, I think, come down in the coming months. That's going to be another reason I think that the Fed will say justifies easing in terms of policy. this idea that wages were leading to higher inflation or at least the expectation of higher inflation well as this goes down i think that will feed into expectations as well so look for that in the next employment report likely to see lower hourly earnings growth because of that cooling in the labor market and if we look at jobless claims here this is the one that people were worried about just a few weeks ago talking about recession because it was trending upward uh again another reading we got this week suggesting that we're not going to head at least straight up it doesn't it seems to be what we saw last summer in terms of a rise in jobless claims and so far it's starting to come back down so this would be a leading indicator for the employment market and as long as this is not accelerating to the upside showing you the labor market maybe it's cooler but it's still in reasonable shape where it stands today.
So I think this will be the number of people continue to look at as it tell our employers laying off the workers or they or are they just not hiring as many as they were the year before or not posting as many new job openings. I think that number will come down again when we get the next data point. So all important stuff. We're going to talk about that with the employment report next week.
And again, I don't think that any. data point in there unless we just see a crazy rise in the unemployment rate that's unexpected which i'm not expecting unless that were to happen i think the fed gets everything that it needs in that report to cut 25 basis points in september okay let's shift gears here talk about the housing market double the down payment over the past five years the whole average the median down payment for u.s home buyers has more than doubled so we're looking about thirty thousand five years ago and today we're at 67 500 record high of course the big reason for that would be that home prices continue to hit new highs up around six percent over the last year affordability unfortunately still near record lows if we look at this by city everywhere has gone up over the past year but you can see big difference between different areas in terms of the appreciation rates if we look at the 20-city index here for Case-Shiller, another record high in June. And what we're seeing here is a big gap between the rate of appreciation. for home prices over the last five years versus the rate of increase for people's wages and that has caused this affordability index to go way down because people's wages simply haven't kept pace with the increase in home prices and then you have the fact that mortgage rates are more than double where they were a few years ago so what we're looking at here is the case schiller 20 city index up over 50 percent in the last five years and you have average hourly earnings in the us up a little over 24%.
And so more than double has been the appreciation in terms of home prices versus earnings. And historically, this relationship over long periods of time have been one for one, which would make sense because people should be able to buy a home based on what they can afford based on their actual incomes. And when we've had a huge deviation from that in the past. the biggest one being the housing bubble of the early 2000s eventually it corrected so home prices would go down nationally over 20 percent after that last housing bubble that normalized this relationship and the question is is this going to happen again are we going to have home prices come down or are we just going to have them stay flat but over the long run you're likely to see this relationship converge the question is how many years is going to take to get there okay i want to talk about the lock-in effect because this is really the impact on this in the housing market has been unbelievable something we've really never seen before because we never saw what we saw in terms of the spike in mortgage rates over the past few years going from record lows to the highest levels we've seen since 2000 in a very short period of time and what that caused was people who had a mortgage and were living in a house and who were perhaps ready to move. Well, they decided I can't move because I can't afford a new house, getting out a new mortgage, or I don't want to move because I have this low interest rate mortgage and I'm saving money versus what I would be spending every month if I were to get a new mortgage.
And so here's the data. It's slowly changing here, slowly changing in a more normal direction. But you can see here still. Still very different picture than where we were a few years ago.
What we're talking about here is 86% of mortgages in terms of U.S. homeowners are below 6%. So a few years ago, we got 93%. So it's moved down a little bit because we've had, of course, a few years and people are taking out mortgages above that level if they're buying a new home. But here's the real crazy statistic.
Still, 57% of... homeowners with mortgages have a rate below four percent and that's come down from 65 but still very very elevated so what that has led to is a record low in terms of the number of existing homes for sale but as we've been saying the the number of homes for sale has been trending up very slowly over the past year and perhaps showing signs of life and redfin was kind of talking through maybe some of the reasons why we're seeing this lock-in effect, perhaps ease here. And what they're saying is, well, just simply, it's not realistic for people to stay in their house forever, especially if they have a major life event, have a job change, have a divorce.
They may not have a choice. They might have to move. So that's certainly part of it. As time goes on, you're going to have more people in that camp. Another reason that they're discussing here is that, well, now it's been a few years of high mortgage rates and if someone bought a home two years ago with this high mortgage rate and now they're ready to move not not a huge number of people yet but now that won't be a decision for them because actually mortgage rates are actually starting to trend lower so as time goes on i think that group of course becomes bigger and finally here they're saying and i think this is an important point that not everyone has a mortgage, so they're not impacted by that.
If they're going to buy a house that's actually smaller, they're downsizing, well, they have this huge appreciation in their current house. Well, they might say, well, let's just list now. I don't need a new mortgage.
And that would be especially true for them. And anyone who doesn't have an existing mortgage, which is a growing number of people, that's not going to be a factor for them as well. And I showed this chart a few months ago, but I want to show it again here.
The increase in mortgage-free... homeowners here over the last decade or so here 2010 we're looking at 33 of the of homeowners without a mortgage in here in 2022 39 so we're i think two years from uh we're two years since we got the last data point here are probably over 40 percent of now people not affected by that mortgage rate in terms of it impacting the lock-in effect so all these data points would suggest that housing supply should increase over the next year and looking at mortgage rates uh in terms of where they are today we're actually seeing the lowest rates now since may 2023 6.35 percent so if you think that the 10 year and 30 year are going lower over the next year of course we don't know just because the fed is cutting interest rates we don't know where longer term rates uh will stand at that point in time but if you think let's say the mortgage rate is going to be down around five percent by the end of next year or five and change perhaps that'll change the dynamic as well and that will uh ease ease the decision for someone who's ready to move looking to move perhaps even if they had a mortgage rate at 3%, maybe at 5%, the math starts to work. So we don't know because we haven't been in this situation before. Just like no one anticipated the huge drop in supply from this spike in mortgage rates, perhaps we're not going to anticipate what happens in terms of the housing market when and if this mortgage rate really comes down.
So I think the expectation should be that regardless of... the situation in terms of mortgages, the prices, the affordability level is unsustainable. So your expectation for the housing market should be a much cooler housing market in terms of prices over the next decade than we saw over the last decade. That should be your expectation regardless of any of these other factors. And as we talked about last week, the home builders are ready to build and there's a huge supply deficit.
That over time, as long as there are competitions, as long as there's demand and as interest rates go lower, I would expect many more homes to be built. And that should help as well ease the pricing pressures. Okay, I want to end, as I always do, with something positive.
That would be more affordable rents. This is the most important factor for many households. It's by far the biggest line item in people's budgets often. over 30 percent sometimes 40 percent of people's budgets go to their rent or their housing payment and we're looking here at the year-over-year change in asking rents according to apartment list where they look at this data across the U.S this is a national average and what they're saying is once again asking rents so these are uh landlords listing their properties what are they asking for that rent versus a year ago once again That is lower on a year-over-year basis, down 0.8%. That's the 15th straight month where we've seen a decline, a year-over-year decline in this asking rent.
If we look at it on a nominal basis, you can see that here, where nominal asking rents peaked actually in 2022. We're actually lower today than back then. And the good news is people's wages, people's incomes have increased over the past two plus years. which means that if we adjust for that increase in wages, so that higher wages, we're seeing a decline in that asking rent even more than on a nominal basis. So we're about 10% lower if you adjust for higher hourly wages today.
And you could see since 2017, this is where data goes back to, we haven't gone anywhere. So in terms of rents and in terms of incomes, they pretty much kept pace over the long term here over seven year period and you could see the spike that we had during that high inflation period 2021 into 2022 but since then we've actually moved in a good direction with rents adjusted for wages actually trending lower and the big reason for that just comes back to supply and demand so unlike the housing market for purchase the apartment market has seen a huge huge supply increase so more vacancies 6.7 percent highest since 2020 just a huge construction boom in terms of multi-family that we saw in the past decade has led to more apartments out there and that means more vacancies and that means lower prices for potential renters and so this is a great thing for anyone looking to rent an apartment once again the relationship between buying a home and renting a home we've talked about it's often it's often looked at comparatively well what is the cost to buy versus to rent and really what we were saying early in the year is It's never been cheaper to rent versus to buy. That equation's got a little bit better for buyers because mortgage rates have come down, but still very much more favorable in terms of what it would actually cost you to rent versus buy today because of this supply-demand dynamic. Okay, I want to end it right there.
Something very positive for anyone in the rental market. Everybody, thank you for watching The Week in Charts. If you're watching this on YouTube, take a moment hit that subscribe button have a great labor day weekend everyone and i'll see you next week on the week in charts