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How The Ukraine War And China’s Lockdowns Will Affect Mortgage Rates, According To 3 Experts

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How The Ukraine War And China’s Lockdowns Will Affect Mortgage Rates, According To 3 Experts

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A cargo ship fully loaded with containers leaves Port Container Terminal in East China’s Jiangsu Province, May 9, 2022. Inflation is already running high, and the latest COVID-19 lockdowns in China are straining supply chains and inflation further. Mortgage rates are expected to feel the pressure soon, experts say.

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The U.S. economy has been hounded by inflation for months and geopolitical events are compounding the issue further — threatening to increase the cost of everything from home loans to hotdogs.

In March, inflation hit a 40-year high of 8.5% and the Federal Reserve has responded by increasing short-term interest rates, which has helped to push mortgage interest rates higher. With the war in Ukraine and China’s COVID-19 lockdowns adding to inflationary pressures, the Fed is expected to continue raising rates.

Early on at the start of the year we saw some indications that supply chain problems were starting to be alleviated, says Lindsey Piegza, chief economist at the investment firm Stifel Financial. Instead, Russia’s invasion of Ukraine and the latest lockdown hitting China are poised to add pressure to inflation that was already running high. 

“Reports suggest that supply chain disruptions are almost as bad as they were during the lockdowns of 2020,” Piegza says. “But it’s going to take months for those disruptions to seep fully into the supply chain. The pain of the April and March lockdown is not yet fully being felt in the manufacturing sector outside of China.”

With so many variables potentially impacting the economy, here’s where three experts believe mortgage rates are headed based on the current conditions in the global economy.

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How Three Experts Think the Ukraine War and China’s Lockdowns Will Affect Mortgage Rates

Dr. Lindsey Piegza, chief economist at Stifel Financial

These events have exacerbated the current inflationary environment, adding increased “pressure on the Fed to take more aggressive action to raise rates faster and potentially higher than they otherwise would have.” This will lead to rising interest rates for all types of borrowing. “It’s going to impact every individual and every American household.”

Ken H. Johnson, real estate economist at Florida Atlantic University

Both of these events can negatively impact the supply chain and add a degree of uncertainty to the global economy. The longer these issues persist the greater the threat to the global economy. In this scenario, investors are likely to seek higher rates of return on their investments. This means investments tied to mortgage loans would need to adjust to attract buyers which, “in turn will tend to drive mortgage rates up.”

Odeta Kushi, deputy chief economist at First American Financial Corporation

An economic downturn could cause rates to fall. However, further supply chain disruptions could add to inflation, which puts upward pressure on mortgage rates. “Mortgage rates may bounce around week-to-week as these forces push and pull, but the expectation is that mortgage rates will inch upwards in the months to come as the Fed takes aggressive action to tame inflation.”

How Homebuyers Can Deal With the Economic Uncertainty

Even when faced with rising interest rates, it may still be the right time in your life to become a homeowner. What’s most important is to focus on the fundamentals of homebuying: Buy what you can afford and have a long-term timeframe for owning the home. This way you’re better positioned to weather the ups and downs of your local housing market.

Focus on Your Budget

A useful budget for a home purchase and day-to-day expenses can help you align your financial decisions with your goals and priorities.

As you consider what housing situation is best for you and your family, build in flexibility to deal with uncertainty. As a rule of thumb, experts recommend spending no more than 28% of your pretax income on housing.

“I think individuals and households need to be asking themselves, can they withstand a sizable shock to their income?,” Piegza says. “Do they have enough savings to carry them for at least one month, two months?”

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Carefully Consider If It’s the Right Time and Place to Buy a Home

With both interest rates and home prices rising, it is quickly becoming much more expensive to purchase and own a home. 

“It’s pretty clear. We’re at the peak of the current housing cycle,” Johnson says. And some experts believe the outcome of this housing market will be different than it was during the Great Recession. In the coming years, housing markets could look very different from one city to the next. “All areas have [housing] inventory shortages right now, but some areas of the country are getting population influx, and others are losing population or have minimal gain expected,” he says.

In real estate markets that are gaining population, “those parts of the country are going to see a prolonged period of unaffordable housing,” Johnson believes. And in cities with a declining population, we could see a downturn in the housing market.

Depending on your situation and your timeframe for owning a home, renting could make sense. I think renting is wise, even in the face of rising rents because it’s a shorter time commitment and you can reinvest what you would have spent on homeownership, Johnson says. The money you would have spent purchasing and maintaining a home could go into an emergency fund, add to down payment savings, or give a boost to your retirement account.

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Metaverse

Top Video Game Artists Adopt NFTs To Help Ukraine, Collection To Release On Official MetaHistory Museum

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Top Video Game Artists Adopt NFTs To Help Ukraine, Collection To Release On Official MetaHistory Museum

Since the outbroke of the Russian-Ukrainian war, many celebrities, social activities, and visual artists joined the league of supporting Ukraine by cryptocurrency and NFT artworks. And the trend just doesn’t stop. Now, a group of top-notch artists bring the support and devotion to a brand-new level with long-lasting impact – the avatar NFT series. The absolutely stunning visuals, the breathtakingly painful images, the suffocatingly realistic resemblance of the ongoing cruelty, and the undying power of resilience truly set these artworks apart and earn them a solid place in the contemporary NFT art world.

Avatars for Ukraine + MetaHistory

A group of top video game industry professionals, credited for game hits Rainbow Six, Warframe, S.T.A.L.K.E.R., and a billion-downloaded Asphalt franchise, together with the most talented Ukrainian digital artists created a charity NFT collection to help Ukraine. The collection will be released MAY 19 2022 on MetaHistory, an official Ukrainian charity NFT platform that has already raised 260 ETH / $722k for Ukraine. Their initiative is supported by the Ministry of Digital Transformation of Ukraine, a Ukrainian government institution known for its pro-crypto position, that has already raised more than 60 million for Ukraine in crypto donations.

The charity NFT collection is named Avatars for Ukraine. The title refers to the original meaning of the word ‘avatar’, translated from Sanskrit as “incarnation”. The stunning artworks capture the incarnations of everything free Ukraine stands for: its soul, spirit, wisdom and love. The collection is uniquely different from other avatars, not only in name. The artworks emerged during 2 months of war and were created by 50 of the most talented and acclaimed Ukrainian digital artists from both game and movie industries. Europe’s best science fiction illustrator Volodymyr Bondar, prestigious EuroCon award winner, contributed with an exclusive artwork. Volodymyr can be seen as an incarnation of spirit himself: he risked his life evacuating dozens of people from heavily shelled Kharkiv. Curators of the collection, lead artist and the art director behind a billion-downloaded Asphalt game franchise, both have the same name, Kateryna. One Kateryna spent days hiding from airstrikes in the subway with her cats, the other found shelter in Romania.

Many NFT collections are exclusively interested in the money aspect of it, and the speculative mentality of both buyers and sellers fuels the controversy around the market. For the ideologists behind the Avatars collection, the purpose is noble. Alexey Savchenko (UK), former business development manager for Epic and former PR manager for GSC, says: “We thought if we were going to do NFT to help Ukraine, we should do it in the same way we build our game universes, with high production values and the best talents around us. Epic Games, the company that will most likely be the first one to build the ‘real metaverse’, raised $150 million for Ukraine”. Dmitry Tarabanov (Canada), game designer credited for game hits Rainbow Six and Warframe“: “Both game and movie industries allow you to experience universes worth millions in production, at a price of a few bucks, somewhat the opposite to the NFT culture. The stunning art created by these artists is free for all humanity to experience. Yet if there is a historic artwork, like a sketch of the first AT-AT walker from Star Wars, its original is priceless. The artworks in this collection are as historic. No matter the price, all money goes to Ukraine”.

MetaHistory NFT platform helped the team by shaping the NFT technology to their high standards. MetaHistory has a success record as a charity NFT platform officially approved by the Ministry of Digital Transformation of Ukraine, pro-crypto government institution that has already raised millions in crypto for Ukraine, and earlier teamed up with Elon Musk to deliver Starlink to Ukraine. The level of cooperation between crypto industry, electronic entertainment and official institutions has made this NFT collection unprecedented, as well as the circumstances behind it. “We wish there will be no more artworks created in the largest war since WWII. We wish there will be no legendary artists painting while their cities are being shelled. We wish there will be no more than 70 items in this collection, because every day this war has been adding one more artwork. Still, these NFTs are here and now to fulfil their destiny, the noblest cause for this technology that one can think of: to help good prevail, to invest in the future we believe in, and to adopt the right direction of history”, their joint statement says.

Neomi

An author from China with experience covering art, music, culture, tech, and travel. Bitcoin.com News sent her into the metaverse to capture the feeling of a pioneer entering this new reality.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

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Bitriver

Russian Crypto Mining Giant Bitriver Considers Challenging US Sanctions

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Russian Crypto Mining Giant Bitriver Considers Challenging US Sanctions

Russia’s Bitriver, one of the largest operators of crypto mining data centers, may take legal action against the U.S. over the decision to place it under sanctions. The company insists it does not help the Russian government to circumvent international restrictions.

Bitriver Rejects US Accusations as Unfounded, Sees No Legal Ground for Sanctions

Leading Russian mining enterprise Bitriver is considering filing a lawsuit against the U.S. Treasury Department, which recently designated the Swiss-registered company and a number of affiliated entities in a new round of sanctions against Russian businesses and individuals. Russia’s coin minting potential was specifically targeted with the new penalties imposed over the war in Ukraine.

In comments to the RIA Novosti news agency, Bitriver stated that the actions of the department are damaging its reputation and international business since the accusations are unfounded. The company is also convinced there are no legal grounds for the restrictions and intends to demand that American authorities remove it from the blacklist. It also emphasized:

Bitriver is not a government agency, but a 100% private company that in no way helps the Russian Federation to circumvent sanctions.

The Russian group also accuses the Treasury of unfair competition practices and lobbying for the U.S. mining industry, thus violating the rules of the World Trade Organization. Bitriver CEO Igor Runets describes the department’s move as “an attempt to change the global balance of power in favor of U.S. companies and remove the largest Russian player from the market.”

Bitriver claims that despite the restrictions, all its production facilities and offices in the Russian Federation are operating normally. The company also continues to provide services to its international clients who, it says, have confirmed their intentions to further cooperate with the Russian bitcoin mining operator.

Western allies have introduced several sanctions packages against Russia that have limited its access to global finances and foreign reserves. Concerns have been raised that the Russian government and citizens may use cryptocurrencies to evade the restrictions. Officials in Moscow have highlighted Russia’s competitive advantages for mining in terms of cheap energy resources and cool climate. A draft law tailored to regulate the sector was submitted to the parliament in April.

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Bitriver, Company, conflict, Crypto, crypto mining, Cryptocurrencies, Cryptocurrency, Group, Lawsuit, legal action, mining, mining operator, restrictions, Russia, russian, Sanctions, U.S. Treasury, Ukraine, War

Do you think Bitriver can successfully challenge U.S. sanctions against it? Share your thoughts on the subject in the comments section below.

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Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Bitcoin

Independent Russian News Site Meduza Raises Over $200,000 In Crypto

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Independent Russian News Site Meduza Raises Over $200,000 In Crypto

Pressure from the Kremlin and sanctions from the West have forced Russian news outlet Meduza to increasingly rely on cryptocurrency donations to fund its independent journalism. As the restrictions imposed over Moscow’s invasion of Ukraine have prevented its Russian readers from contributing in fiat currency, the Riga-based website now accepts several digital coins.

Meduza Pulls Journalists out of Russia, Seeks Crypto Support

The war in Ukraine has affected Russian-language news site Meduza in more than one way, a report by Bloomberg reveals. Soon after the Kremlin launched its “special military operation,” President Vladimir Putin’s administration clamped down on independent reporting on the conflict and the media outlet has sought help to resettle its 25 journalists in Latvia.

The small Baltic nation of around 2 million, which has a large Russian speaking minority, has become a hub for exiled Russian media. Western sanctions, however, do not allow Meduza’s 30,000 Russian readers who supported it before the conflict to send funds through Stripe, after the payment processor suspended services in the Russian Federation to comply with the penalties.

The war and the sanctions have forced Meduza to turn to its international audience and ask for financial help in U.S. dollars, euros, or cryptocurrency. It now accepts card payments, bank wires, Paypal transfers, and multiple coins including bitcoin (BTC), ether (ETH), the stablecoin tether (USDT), and the privacy-oriented monero (XMR). The report notes that the provided BTC and ETH wallets have already accumulated about $230,000 worth of cryptocurrency.

Commenting on the situation, the news portal’s editor-in-chief Ivan Kolpakov pointed out that Meduza is currently raising only around half of what it needs to develop. While declining to reveal the total amount of donations, he noted that the website is soliciting crypto and relying entirely on money from foreigners for the first time and stated:

We couldn’t predict that the sanctions of Western governments will come first and destroy our crowdfunding.

Independent Russian media outlets have faced unprecedented pressure from authorities in Moscow and as a result some have shut down, while others have been blocked by the Russian state. The Novaya Gazeta newspaper suspended publication in March after receiving warnings about its coverage, and the Ekho Moskvy radio station had its FM frequency handed over to the state-run Sputnik.

Meduza, which was founded in the Latvian capital after Russia’s annexation of Crimea in 2014, during another media crackdown, was labeled last year a “foreign agent” by the Russian government. The designation, which targets Russian media receiving funding from abroad, had already hurt its advertising revenue before the new sanctions effectively ended Russian donations.

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Bitcoin, Crypto, Cryptocurrencies, Cryptocurrency, Dollar, donations, donors, ether, Euro, Fiat, Journalism, Latvia, Media, Meduza, news, news outlet, portal, reporting, Riga, Russia, russian, Sanctions, Ukraine, War, website

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Do you expect other independent Russian publications to turn to cryptocurrency donations to fund their reporting? Tell us in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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