A Day of Reversals and Flip-Flops All over the World

Housing market flips and prices flop; Ukraine flips war odds on Putin; inflation reverses; Trump flips and flops all over tariffs; Trump allegedly flip-flops on Iran nuclear deal.

Jun 03, 2025

Today was a day of many strange reversals … and, in some cases, even stranger opinions about them.

Housing flips now that no one is flipping houses

Take for example one of the articles below on the housing market. It says, “The housing market was supposed to recover this year.” Then asks, “What Happened?” What happened is that this is what a recovery of the housing market looks like. As I wrote all about in my weekend Deeper Dive, the ONLY way this housing market ever recovers is by going straight through a crash that normalizes prices. There will never be a “recovered” housing market at these prices. The article claims many economists and analysts thought the housing market would recover this year by gaining a lot more sales without losing anything in price. That is beyond laughable to me, but that kind of mental constipation is why I started writing on economics in the first place.

In my Deeper Dive, I provided the mental laxative these economists apparently needed, explaining how and why it was always clear this market had to go through a hard crash before sales could ever possibly return and why the crash took a little longer than expected to form, and it shows how that anticipated crash is clearly happening now. It is the “what is happening now part”—the easy part—that economists apparently cannot get their heads around. They were so sure things were just going to turn rosy again. How?

Anyone needing the laxative will have to read the Deeper Dive to get it. That Deeper Dive also gives a good sense of the scale of peril this housing market has mushroomed into. The timing of today’s news article right after I laid out the inevitability of this holocaust in housing makes me shake my head and wonder, again, at how economists sometimes understand basic economics less than the average person. They never see a housing crash coming or a recession. What is needed is a total reset—creative destruction—and that is what is starting to happen. It has a long way to go.

So, the housing market has finally reversed to where prices are making serious downward strides, and that kind of correction is the only way you finally get to a housing market where sales will have a chance to recover (for the reasons laid out in that Deeper Dive) without insane Fed policies throwing gasoline all over inflation. If you are someone who got sidelined from the American Dream by the insanity in housing that came with the Covidcrash, then this collapse is your dawning hope for a future day when you may be able to get back into the dream. For sellers, as another article says today that I referenced in my Deeper Dive, home sellers need to get real about their prices … and they are finally starting to.

Zelensky stuns the world and Putin with a major turn in the war

The biggest reversal today came in the Ukraine War. While calling it a complete reversal goes too far, Zelensky scored a victory against Putin today so big that many—even inside of Russia—are referring to it as Russia’s Pearl Harbor. Just when Russians, Putin included, were talking like their victory was inevitable, and Zero Hedge was plugging that claim as a constant drumbeat, Ukraine made some surprise attacks DEEP inside of Russia (like 3,000 miles deep) on multiple military bases, wiping out, according to Ukraine’s claims (which videos would tend to back up) about 40% of Russia’s Tupolev bomber fleet. These are the main planes Russia has used for attacking Ukraine relentlessly, and are the main planes they use for delivering nuclear bombs.

While these planes are all antiques from the earliest part of the distant Cold War era, Russia was highly reliant on them:

Russia no longer produces the decades-old Tupolev planes, meaning it has lost a cornerstone of its ability to project military power beyond its borders. Newer Russian planes are more modern and agile but lack vital characteristics of the destroyed bombers, most significantly their range and the quantity of munitions they can carry. The attack also apparently destroyed a rare Antonov plane Russia uses for airborne command-and-control, another capability vital to modern warfare.

They were arrayed by an arrogantly overconfident Russia in straight lines fully visible along runways, and Ukraine didn’t even need to use long-range European or US weapons to take them out. Instead, it trucked small, expendable kamikaze drones in trucks, smuggled them deep across the border and then flew them straight down the airstrip with no Russian resistance, taking out a significant portion of Russia’s bombers.

Ukraine also took out three trains today, two railroad bridges and sections of railroad just inside of Russia along the Ukraine battlefront. At least, one of the trains was reportedly hauling military cargo.

The hit was so big that some commentators inside Russia are strongly urging Putin to respond with a nuclear attack.

While the Kremlin tried to label it a “terrorist” attack, Ukraine’s Lt. Gen. Vasyl Maliuk, head of the nation’s main security and intelligence agency, the SBU, said the order to destroy the warplanes came directly from President Volodymyr Zelensky and added a note of justice:

The enemy bombed our country from these planes almost every night, and today actually felt that ‘payback is inevitable.’

The other plane mentioned, the Antonov, is one of Russia’s few remaining high-tech surveillance planes. Down to a fleet of 3-4 before that plane was taken out, Russia may have only two of those critical eyes left in the skies, crippling its ability to attack Ukraine and still defend its own airspace.

Russia now will need to devote more resources to protecting bombers and other valuable military assets. The country has a vast air-defense system that it has expanded in recent years, but it lacks sufficient equipment to cover the entire country and protect against all dangers, from long-range missiles to small, slow drones like those used Sunday.
Zelensky said Sunday that the attacks on four bases had been prepared and launched inside Russia.

Inflation reverses for the better … or does it?

Another reversal that Zero Hedge crowed about because it appears to support their claims for months that everyone who has said the Trump Tariffs will cause high inflation are WRONG. That, too, is an ignorant point of view that comes from drumming a point so long and becoming so vested in it for political reasons (such as pandering to your pro-Trump audience and your large Russian audience).

Yes, inflation reversed itself last week and went back down significantly, but there are no straight lines in economics for very long, so a one-time jolt back down doesn’t prove there is no inflation coming from tariffs. However, ZH’s ignorance comes in being too quick to claim (in order to prove themselves right) that inflation from tariffs should even be showing up this soon.

I’ve said repeatedly in my predictions that we should NOT expect to see the inflation that comes from tariffs until summer when products hit the shelves and not until August in reports because inflation won’t hit until products imported under tariffs make it across the ocean, through ports, then through warehouses and get priced on the shelves. Then there is a one-month lag until the reports come out. ZH got ahead of themselves to try to score a success because there was almost no way tariff inflation would hit this quickly. Sure, there has been some clear tariff inflation reported already—probably mostly from products where inventory was already about out and that got shipped extra quickly.

Now, with the US trade court having just ordered a lot of those tariffs removed, the arrival of items arriving under tariffs will be spotty. There will be some things ordered and arriving when there were tariffs. Some when there are not. They will sometimes be the same item, shipped at different times. So, prices may bounce around. Trump’s constant on-again/off-again nature as to whether those tariffs actually get charged and at what level when they hit US shores will also make the inflation erratic. Trump may have to pull the work-arounds that he threatened in response and may even have to refund any tariffs collected up to the present; but that will take more time. So, the arrival of tariff-caused inflation will drag out in fits and spurts.

The timing for the inflation will now also depend on how the court’s order is or is not obeyed by Trump and will depend on how his appeal plays out. So long as the tariffs eventually arrive, the inflation will arrive with them; but there are so many convolutions in the scheduling of the tariffs now that it has become impossible to say when the inflation will arrive in full force.

The king of tacos toughens up

Trump, himself, has been the author of reversals on his own tariffs so many times, taking most of them off within mere hours of when he implemented them that he has earned himself the monicker TACO, as I mentioned last week, for Trump Always Chickens Out, which became the basis of a stock trade made profitable by always betting against his tariffs.

Subsequent to my mentioning the TACO trade, news emerged that the new nickname angered Trump. Today, it appears it has wounded his ego enough to make him more resolved to launch new tariffs and to imply he will stick to them.

Not only did he announce, after earning the TACO moniker, that he was doubling the tariffs on European steel from 25% to 50% (and those tariffs did not get removed by the court), but he also announced he would no longer be “Mr. Nice Guy” with China. Friday, he accused China of turning against their agreement with the US, and he implied tariffs would be going back up because of that.

“China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!” Trump wrote on Truth Social.

That sounds like it could quickly become another reversal by Trump on his tariffs (this time taking Chinese tariffs back up). I don’t know how else he would show he is no longer Mr. Nice Guy and show he is no TACO, other than by making more Chinese products completely contraband. He’s said it is China’s fault like he’s about to make a turn. They disagree, of course, and say America reneged on the deal.

If the TACO trade has stiffened Trump’s spine to show what he’s made of—that his tariffs will finally stand up better than the paper they are written on, ending the 24-hour flop they have become known for, he may be less inclined to back down again when those tariffs throw stock and bond markets back into turmoil. Still, we know he is much concerned about those markets, especially the bond market.

As a result of this new threat, the stock market reversed its post-tariff rally this morning, with the Dow down 200 points, but then it reversed itself again and eventually clawed its way back to a small gain by the end of day.

The endless reversals on tariffs are driving businesses and investors nuts, and the make the US look unstable for business or agreements. Economists are saying, and I fully agree with them on this much, the doubled tariffs on European steel will raise the price of steel considerably in the US, effecting every product made in the US that uses US steel.

That is, of course, only if they they don’t get reversed back down to 25% tomorrow with Trump saying the next reversal is because “Europe now looks ready to deal,” as he’s said with all the other reversals. This has been the most spasmodic presidency I’ve ever witnessed, but that, I guess, is supposed to be the art of the deal. Always keep them guessing. It’s no way, however, to run an entire nation. No wonder so many of Trump’s past deals ended in bankruptcy, which Trump filed for often enough that he said in his own writings that bankruptcy is just another form of finance.

Iran deal bombs with conservatives

One flip by Trump—or, at least, an apparent flip—has conservatives irate today: It just got reported that the White House’s new nuclear deal in the works with Iran will allow uranium enrichment. Conservatives say they find it difficult to distinguish the Trump deal from the “lousy Obama deal” with Iran, which Trump tore up years ago. Their strident objections may not matter, though, because Iran has already indicated it will reject the deal because it says it does not allow enrichment. (Maybe why that just got added?)

A reporter claimed today the deal does now include allowance for enrichment. Conservative are in an uproar because they feel Trump has flip-flopped on his assurances to Israel and to his base. The White House simply commented today that it refuses to clarify that point because the deal is still in negotiation. So, we don’t know.

What we do know is that Trump has said that, if Iran doesn’t accept a deal very soon, then the US will move to war for the answer. So, we may soon find out if he holds to both his threats of no enrichment and war if no deal, or if he’ll reverse himself with a claim that a deal is now nearer than ever, even though Iran rejects this one. Will it be “no more Mr. Nice Guy” with Iran, too?

What Trump might do is just green light Israel to move ahead with an attack and then step in to support Israel where needed. Reports have said Israel appears to be getting ready to make such an attack in the last few days. Is that just to put pressure on Iran to make the deal, or is it a path to end all further negotiation if Iran refuses this deal? Israel doesn’t like a resolution by deal-making anyway.

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Real-Estate Rubble (housing, commercial & global real-estate bubble trouble)

The Housing Market Was Supposed to Recover This Year. What Happened?

'Sellers Need To Wake Up—This Isn't 2021 Anymore,' A Real Estate Agent Says, Claiming Homes Are Sitting For Weeks After Price Cuts

Sellers Outnumber Prospective Homebuyers by Nearly 500K

More office space is being removed than added for the first time in at least 25 years

Money Matters (monetary policy, metals, cryptos, currency wars & going cashless)

Trump Does 180 and Sets up Infrastructure for a Central Bank Digital Currency

Inflation Factors (from too much money chasing too few goods due to weather, sanctions, tariffs, quarantines, etc.)

Despite Tariff-flation Fearmongering, Fed's Favorite Inflation Indicator Tumbles To Four-Year Low

Deep Domination (globalism, unelected government, unconstitutional government & censorship)

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Trump Taps Palantir to Create Master Database on Every American

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Doomer Humor

No Tax On Tips Passes Senate Unanimously After Clarification That Bribes Can Count As Tips

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The Watchman

Good one, David. Linking as usual @https://nothingnewunderthesun2016.com/

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1 reply by David Haggith

Charles McRae

Better than most of your articles of late, covered real issues. I get tired of the Trump hate, every political leader does some stupid things. Tariffs are a non-event, the debt problem is going to sink the country. David you like to beat up Trump, I only see one place where he's wrong. We can't grow out of the debt. Get away from the news of the day.

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