 |
| Housing Review |
The US Home Construction's overall trend, revealed by trends of price, leverage, and time, are defined in The Matrix for subscribers.
Subscriber Comments
When We Said Here Comes The Economic Shit Show, We Meant It
We’re not here to distract you with meaningless political nonsense for clicks and division. The real economy is a complete disaster, just as expected. We called it an economic shit show, so you'd remember. Do you believe us now? If economic cheerleading and hopium is the only thing that sells, we'll go out of subscription business fast. This doesn't mean we won't make money.
Click to Read
Use your Subscription Level Access Code to access the full review.
Home Depot’s stock hasn’t crashed; it’s been bleeding out slowly for weeks, while the US government shutdown over politics and posturing. The quiet, relentless decline that’s actually more telling than a single-day plunge. We’ve been saying for a long time that the Economic Activity Composite cycle, a trend discussed regularly in the Economy & Stock Report, is a runaway freight train of pain that even Superman can't catch. Yesterday’s earnings report confirmed what we knew was coming. CEO Ted Decker essentially admitted the big demand rebound they’d been hoping for never showed up, customers are disappearing, and the toxic mix of uncertainty plus the continuing chokehold on housing is crushing discretionary home improvement spending. That’s a big deal. Home Depot is the place where confidence sparks spending.
The housing market is frozen, consumers are spent, and when homes aren’t changing hands, nobody’s ripping out cabinets or laying new floors. The Housing Report which launched in February 2025 wasn't a subscription grift. It was launched because the Housing Oscillator's decline to the May 2025 low, the lowest reading since 2006, was too significant to ignore (see Chart). We expect that not only does the majority underestimate the ramification of this trend but also subscribers. US construction spending is a cornerstone for the U.S. economy. When that turns, everything downstream in the economy feels it. The Housing Oscillator has not been updated since late September.
Chart: Housing Oscillator from Housing Report
Home Depot reported a 2.8% increase in sales, but once you back out the GMS acquisition, year-over-year growth was essentially flat. U.S. same-store sales rose a mere 0.1%. Taken together, these numbers point to economic deterioration. During the earnings call, management effectively confirmed the cycle by cutting full-year EPS guidance to down 5–6%. It was clear acknowledgment that the downturn isn’t “transitory” as forecasted by the numerous talking heads.
Home Depot ($HD), part of the U.S. Home Construction Sector ($ITB) tracked in the Matrix, typically serves as an early indicator for the broader economy. We’ve emphasized this so many times that we worry subscribers likely tuned out the warning, as if it’s just another “boy who cried wolf.” A slowdown in U.S. home construction carries weight: big-ticket purchases get postponed, homeowners choose repairs over replacements, contractors face thinner project pipelines, and housing-market weakness begins to seep into everyday consumer behavior. Forget the idea that trade schools are a safe haven from AI when consumers economy turns down. Trade jobs will be slashed from 2026 to 2028.
Home Depot is not just a warning shot across the bow, it's a loose cannon on the deck of the economy.
Follow me on 𝕏 or Facebook for further discussion.
----------------------------------
The Matrix provides market-driven trend, cycles, and intermarket analysis.
