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  • Demand surges for Airbnbs during the World Cup in L.A., with prices jumping 56%

    On June 12, Peggy Orenstein’s inbox flooded with booking requests for her Inglewood Airbnb.

    The date seemed random, but after a quick search, the influx of interest became clear. It was exactly a year before one of the biggest events in American soccer history, when the U.S. will kick off its World Cup in a match against Paraguay at SoFi Stadium, and Orenstein had set up the system to only accept booking requests up to a year in advance.

    Orenstein’s rental sits just across the street from the venue. Suddenly, her Airbnb became one of the hottest homes in the Southland.

    She hadn’t adjusted the prices yet to reflect the rabid demand, so she declined the requests and tweaked the rates. Typically, a two-night stay at the house would cost around $1,000. For a two-night stay during the Americans’ opening match June 12, it’ll now cost more than $10,000.

    Roughly 6.5 million people are expected to travel to North America during the 2026 World Cup, and many of them will be heading to L.A., where SoFi Stadium is hosting eight games, including two U.S. matches during the group stage. Airbnb hosts are viewing the games as a gold mine, hoping soccer fans will shell out thousands to stay near the stadium.

    The World Cup rental market will serve as a test case for the 2028 Olympics, when an estimated 15 million people are expected to visit Southern California.

    For the night of the opening match June 12, more than 70% of short-term rentals in Inglewood have already been booked, according to data site Inside Airbnb. That’s a 58% increase compared to typical reservation rates on normal days.

    Rates are rising as well. On June 1, the average booked rate for an Airbnb in L.A. is $245, according to data platform AirDNA. On June 12, when the U.S. plays Paraguay, it’s $382 — a 56% jump.

    In Inglewood, prices are even wilder. Homes that normally rent for hundreds are listed for thousands. The nightly price for a one-bedroom apartment a block from SoFi is typically around $400. On June 11, the day before the game, it’s $713. On June 12, the day of the game, it’s $1,714.

    “It’ll be interesting to see how much people will pay,” Orenstein said.

    Some hosts use an algorithm to determine their nightly rates, but Orenstein sets the prices herself. She arrived at the $10,000 number by looking at nearby hotels, which are mostly sold out for the nights of the eight World Cup matches.

    “The Lum Hotel had a suite available during the World Cup for $1,943. Meanwhile, our house can accommodate eight guests with four bedrooms, plus a kitchen and yard,” she said.

    There are classic amenities such as a grill and hot tub, but the biggest amenity is proximity. Orenstein is banking on visitors ponying up for the convenience of parking at the property and walking to the stadium while everyone else navigates traffic jams and long rideshare waits.

    “It gets crazy out there,” she said. “I’ve had people offer to pay me $40 to use the bathroom while walking by during a Taylor Swift concert. Our neighbor sold parking spots for $1,000 during the Super Bowl.”

    David (pictured) and Peggy Orenstein, run an Airbnb across the street from SoFi Stadium.

    (Robert Gauthier/Los Angeles Times)

    Colin Johnson has been renting out his home near SoFi Stadium for two years. It’s his actual residence, meaning when someone stays there, he has to book a hotel or crash on a friend’s couch. But he said the payouts are worth it.

    “There are so many events and venues around us, why wouldn’t we take advantage?” he said.

    A typical two-night stay in the three-story townhouse runs about $600. For the U.S. opening match, it costs more than $3,000.

    Johnson said demand is roughly 60% Americans and 40% foreigners, but he expects foreign interest to pick up as the games get closer.

    Demand isn’t limited to Inglewood. Luxury rentals across Los Angeles are being booked for eye-popping numbers, according to Mokhtar Jabli, founder of luxury rental platform Nightfall Group.

    He’s booked two so far. The first was rented by a Florida client coming to Los Angeles to see Iran play two matches at SoFi Stadium against New Zealand and Belgium. The modern home in Hollywood Hills, complete with an infinity pool overlooking the city, rented for $33,000 for seven nights from June 15 to 22.

    The second was booked by a New York client coming to see the U.S. play Paraguay. The 7,000-square-foot mansion in Malibu comes with a movie theater, butler, security and full-time staff. For 10 days, it rented for $100,000.

    Jamie Lane, chief economist for AirDNA, expects a surge across L.A. County — not just in demand, but in supply.

    “There’s a lot of interest right now in what you can make as a host,” Lane said. “In most cities, there won’t be enough lodging, so that pushes rates higher.”

    He added that since Airbnb is the official “Alternative Accommodations and Bookings Platform” of the World Cup, the company is urging people to host. AirDNA has hosted multiple bootcamps around the country for people interested in renting out their homes during the World Cup, teaching them how to furnish homes, how to set prices during the games and more.

    Lane expects a boost in listings early next year, which would mirror Paris in the months leading up to the 2024 Olympics, when active listings soared by 40%.

    It’s unclear how proactive Southern California cities will be in cracking down on illegal listings as homeowners look to make a quick buck by renting out their rooms. Many cities have strict short-term rental regulations, but haven’t taken the steps necessary to enforce them.

    Last year, the L.A. Housing Department estimated that 7,500 short-term rentals were violating the city’s Home Sharing Ordinance, but the city only issued 300 citations.

    Orenstein said it won’t be easy in Inglewood.

    “You have to jump through hoops to have an Airbnb,” she said. “Apply for permits, do inspections, pay your taxes every month. It has to be done right.”

    Jack Flemming, Hailey Wang

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  • Southern California is in for a weekend of severe weather, forecasters say: What we know

    Southern California will be under a severe weather threat Saturday, with the most powerful wave of an incoming atmospheric river storm peaking over the weekend in Los Angeles County and bringing a risk of mudflows, debris flows and, possibly, a tornado.

    If rain falls as forecast, this storm could result in downtown Los Angeles seeing its wettest November since 1985. Heavy rain brings the possibility of damaging flooding and landslides, with fire-scarred hillsides from the Eaton and Palisades fires at risk of fast-moving flows of mud and debris.

    The severe weather threat is expected for much of Saturday, from midnight through 9 p.m. A flood watch will be in effect for a wide swath of Southern California from 4 a.m. to 10 p.m. Saturday. Evacuation warnings are in effect through 11 a.m. Sunday in areas near recent burn scars due to the risk of mud and debris flows. The warnings encompass areas near the Palisades, Eaton, Kenneth, Sunset and Hurst fires that burned in January.

    But it remained unclear as of late Thursday which areas would be hit hardest by the storm. Peak rainfall rates Saturday of 0.75 to 1.25 inches per hour are expected along a relatively narrow band of land — about the width of a Southern California county. That’s enough rain to trigger a landslide, which can occur when rain falls at a rate of half an inch or more per hour.

    Forecasters don’t yet know where that peak rain will be focused.

    “The problem is, we just don’t know exactly which county” will be most affected, said Ryan Kittell, meteorologist with the National Weather Service office in Oxnard. “If you look at all of our projections, some of them favor L.A., some of them favor Ventura, some of them favor Santa Barbara County. And so at this point, unfortunately, for that Saturday time period, we just can’t tell with certainty which county is kind of in the bull’s-eye.”

    If the band of most intense rain lines up over L.A. County, it can expect rainfall rates of about 1 inch per hour, Kittell said. If the band is concentrated elsewhere, L.A. could still see a rate of half an inch per hour, and landslides would still remain a possibility.

    The area with the most severe weather could see spinning thunderstorms that could produce damaging wind or a tornado or two, Kittell said.

    “While 99% of the area will not see such conditions, any portion of our area, especially in the coastal and valley areas, could see it,” Kittell said. “Consider changing any plans that you might have for Saturday. Stay home and indoors.”

    In case of lightning, he noted that it’s best to stay inside and away from windows. Those who must go out should never attempt to drive through a flooded roadway.

    There’s still a chance that Saturday’s storm could be less impressive than expected. It is being powered by a “cut-off low,” which is so notoriously difficult to forecast that it’s referred to as “weatherman’s woe.” Because the low-pressure system powering the storm is not pushed along by the jet stream, “it will just spin around like a top and go where it pleases — very difficult to predict,” Kittell said.

    Still, Kittell said, most of the more than 100 different computer forecast projections suggest moderate to heavy rain. In the most likely scenario, downtown L.A. will receive 2.62 inches of rain between late Thursday and Sunday, which would cause flooding on roadways and minor, shallow debris flows.

    (National Weather Service)

    Getting that 2.62 inches of rain through the weekend would vault this month into the category of wettest November since 1985, Kittell said. Downtown L.A. would need to exceed 2.43 inches of rain in November to break that 40-year-old record.

    There’s a 30% chance of a worst-case scenario where downtown L.A. receives 4.81 inches of rain, producing mudflows and debris flows. With debris flows, the fast-moving landslides pour down hillsides and pick up not just mud but other debris that can move cars and crash into homes with deadly force. A total of 4.81 inches of rain would be one-third of downtown’s annual rainfall.

    Both mudflows and debris flows can be triggered with rain falling at a rate as low as half an inch per hour. But it depends on the burn scar, Kittell said. It would take rain falling at twice that rate — an inch per hour — to trigger flows in some burn scars, he said.

    The National Weather Service office in Oxnard said that on Saturday there’s about a 70% chance that the Eaton and Palisades fire burn scars will see rain fall at a rate of 0.5 inches or more per hour. There’s a 38% chance of a rainfall rate of 1 inch or more per hour in those areas.

    Rain is expected to start falling by Friday morning in Los Angeles, Orange, Riverside, San Bernardino and San Diego counties. Precipitation was forecast to begin Thursday in Ventura, Santa Barbara and San Luis Obispo counties.

    The heaviest rain for Southern California is expected late Friday into Saturday.

    Document shows precipitation chances and timing

    (National Weather Service)

    Although tornadoes aren’t usually associated with California, they do happen. For the most part, “they’re weak, they’re brief, and usually don’t cause a whole lot of issues,” Kittell said. “But we do get quite a few of them.” Sometimes they form on land, or they begin as waterspouts — a tornado over the ocean — and move onto land.

    “They are not like the kind that you typically hear about in the Midwest that last for 15, 30 minutes, or even an hour or two, and are a mile or two wide and cause destructive damage,” Kittell said. “We just don’t have the environment for that,” yet they still pose a threat.

    A tornado lasting for five minutes touched down in Santa Cruz County last December, injuring three people, downing trees and power poles, stripping trees of branches, overturning vehicles and damaging street signs.

    This weekend’s atmospheric-river-powered storm created a long band of rainfall that on Thursday was stretching across the Pacific Ocean to San Francisco. It was set to move south and east as it headed to Southern California.

    The storm downed trees in the San Francisco Bay Area on Thursday and flooded low-lying streets. A tree split and fell in San Francisco’s Western Addition neighborhood, crashing onto a vehicle, local news outlets reported. A tree also fell on a fence in Santa Rosa. Rising waters inundated a section of roadway just west of the Charles M. Schulz-Sonoma County Airport, firefighters said.

    Solo vehicle crashes were reported on Highway 1 in Santa Cruz County, the California Highway Patrol said. A pickup truck overturned along Highway 152 between Watsonville and Gilroy, and all lanes of Highway 17 connecting Santa Cruz and San Jose were shut down for some time Thursday night following a crash involving a CHP cruiser; a CHP officer sustained minor injuries.

    Rainfall totals were impressive for the region, with San Francisco seeing 1.28 inches — that’s more than half the average monthly rainfall for November for the city. Napa received 1.45 inches; San Francisco International Airport, 1.5; and San Rafael, 2.3 inches.

    Through Sunday, Long Beach is expected to receive 2.38 inches of rain; Redondo Beach, 2.48; Oxnard, 2.49; Thousand Oaks, 2.63; Santa Clarita, 2.77; Covina, 2.89; and Santa Barbara, 4.21.

    San Diego could get 2 to 2.5 inches of rain; Riverside, San Bernardino, Escondido, and San Clemente, 2.5 to 3 inches; and Anaheim and Irvine, 3 to 4 inches, according to the weather service.

    Even the deserts could tally impressive rainfall. Palm Springs may get 1 to 1.5 inches of rain, and Joshua Tree National Park could receive 1.5 to 2 inches.

    This storm will not be much of a snow maker for Southern California’s mountains. Snow levels are expected to remain at around 10,000 feet for most of the storm’s duration, said Dave Munyan, a forecaster with the National Weather Service’s San Diego office. By Sunday morning, snow levels will fall to about 7,000 to 7,500 feet, but by then, there won’t be much more moisture left in the storm. Big Bear is forecast to receive around an inch of snow, and Idyllwild is expected to remain snow-free, Munyan said.

    “You’re going to get your accumulating snowfall — hefty accumulating snowfall — on the highest peaks of the mountains,” Munyan said.

    Winds from the southeast and east are expected to trigger delays at Los Angeles International Airport on Friday and Saturday.

    Looking to next week, a storm could return to Southern California on Monday and Tuesday, with another rolling in Thursday and Friday. Both storms are likely to have minor effects. But forecasters are closely watching the second of the two storms, which could develop into something more significant, Kittell said.

    Rong-Gong Lin II

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  • 4 found dead inside Fullerton home after friend reported mass drug overdose, police say

    Fullerton police said they discovered the bodies of four people inside a residence after a friend reported they had overdosed and were not breathing.

    Authorities said they were called to an apartment in the 100 block of Wilshire Avenue at 11:01 a.m. on Tuesday and the bodies were discovered.

    “There is no immediate threat to the public,” the police said in a statement.

    Two women console each other after learning of the deaths of four softball teammates.

    (KTLA-TV Channel 5)

    Detectives have launched a death investigation. Authorities have not confirmed the identities of the deceased, but a friend of the group told KTLA-TV Channel 5 that they were all part of the same softball team.

    Police did not confirm the deaths were a result of a drug overdose and could not immediately be reached for additional comment on Wednesday.

    But drug use has become a growing concern in the county in recent years.

    In Orange County, the rate of death due to opioid overdose nearly tripled from 2017 to 2021, from 7.9 deaths per 100,000 to 23.2. The largest increase occurred during the first year of the COVID-19 pandemic, with the overdose rate rising 88% between 2019 and 2020, according to the Orange County Health Care Agency.

    Hannah Fry

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  • California surgeon general sets goal of reducing maternal mortality by 50%

    California surgeon general sets goal of reducing maternal mortality by 50%

    California’s surgeon general has unveiled a new initiative to reduce maternal mortality and set a goal of halving the rate of deaths related to pregnancy and birth by December 2026.

    Health officials say that more than 80% of maternal deaths nationwide are preventable. California has achieved a much lower rate of such deaths than the U.S., but maternal mortality resurged in recent years amid the COVID-19 pandemic, state data show.

    “We have the lowest rate in the country. Now we can do better,” California Surgeon General Dr. Diana E. Ramos said in an interview.

    Ramos was joined in announcing the effort Tuesday by First Partner Jennifer Siebel Newsom, the wife of Gov. Gavin Newsom.

    In California, leading causes of such deaths include heart disease, bleeding, “behavioral health” issues such as mental illness and substance use, and infection. More than a fifth of pregnancy-related deaths in California occur the day of delivery, but the majority happen in the days, weeks and months that follow, according to state data.

    The crisis has been especially stark among Black women, who have faced a maternal mortality rate more than three times that of white women in California. In Los Angeles County, there has been a public outcry in recent years over the deaths of women like April Valentine, 31, and Bridgette Burks, 32 — Black mothers who left behind devastated families.

    Health researchers have faulted numerous factors for the higher rates of maternal mortality among Black women, including the physical effects on the body of enduring years of racism; higher rates of diabetes and other chronic conditions that increase risk; and inequities in the care received by Black patients.

    California officials said they are also concerned about rising rates of maternal mortality among Latinos and Asian/Pacific Islander communities in the state.

    The “Strong Start & Beyond” initiative, officials said, would help patients understand potential risks before they become pregnant and prompt earlier action to address hazards such as heart disease. It would also alert Californians to doula services and other programs intended to support people before, during and after birth.

    Ramos said California had reached the lowest rate of maternal mortality in the nation through its system of reviewing maternal deaths and other efforts centered on hospitals, physicians and other healthcare professionals. Up until now, “the focus has been primarily on the healthcare setting,” she said.

    But “if we keep on doing the same thing — just focusing on the healthcare team — we’re going to get the same results,” Ramos said. Health officials and experts decided they needed to bolster that work, “and that’s why we’re bringing in the patient.”

    “It seems so simple, but oftentimes, the pregnant person doesn’t feel like they have a voice or they have the information they need to make informed decisions,” Ramos said.

    U.S. Secretary of Health and Human Services Xavier Becerra said in a statement accompanying the launch of the new effort that “reducing maternal mortality isn’t a ‘should,’ it’s a ‘must.’ California gets it.”

    The planned strategies outlined in the California Maternal Health Blueprint, released Tuesday, include a new questionnaire that patients can take at home to assess their risk of pregnancy complications and get recommendations for next steps based on their results.

    As an obstetrician-gynecologist, Ramos said she found that it was often at their first prenatal appointment that a patient would first hear, “You’re going to be a high-risk patient.’ And more times than not, patients would say … ‘I wish I would have known that I could have done X, Y or Z to decrease my risk.’”

    California officials also want all medical facilities in the state to use an existing screening tool for gauging the risk levels of pregnant patients.

    Ramos said those results could help guide where patients go for births. Hospitals with limited resources could refer patients with a higher risk of complications — such as someone who “is going to be at risk for hemorrhage, is going to be at risk for ICU admission” — to the medical facilities best equipped to handle them.

    The new effort comes as pregnant patients may face dwindling choices for hospital births: Nationally, roughly 1 in 25 obstetric units closed in 2021 and 2022, according to a March of Dimes report.

    Under “the modern fee-for-service healthcare model … hospitals must fund round-the-clock capacity but are only reimbursed when their facilities and staff are in action,” wrote Dr. Anna Reinert, an assistant professor of clinical obstetrics and gynecology at USC’s Keck School of Medicine, in a recent op-ed.

    “So if not enough deliveries are happening, expenses outweigh reimbursement. This drives hospitals to get out of the baby delivery business altogether,” Reinert wrote.

    California has faced a wave of such closures in the last decade, including at many hospitals in Los Angeles County. A CalMatters analysis found that such closures had disproportionately affected Black, Latino and low-income communities. Among the latest hospitals to announce it would shut down a labor and delivery unit is USC Verdugo Hills Hospital in Glendale, which plans to halt maternity care on Nov. 20.

    Emily Alpert Reyes

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  • $10-billion climate bond will go before voters in November

    $10-billion climate bond will go before voters in November

    California voters will get to decide in November if they want the state to borrow $10 billion to pay for climate and environmental projects — including some that were axed from the budget because of an unprecedented deficit.

    The 28-page bill to put the Safe Drinking Water, Wildfire Prevention, Drought Preparedness, and Clean Air Bond Act of 2024on the ballot was approved by both the Senate and Assembly late Wednesday.

    This was the last day lawmakers had to approve the climate bond proposal to get the measure on the Nov. 5 ballot.

    Senate President Pro Tem Mike McGuire (D-Healdsburg) was acting as governor Wednesday because Gov. Gavin Newsom was in Washington. McGuire is a supporter of the proposed climate bond and was expected to sign the legislation Wednesday night.

    “Ensuring that our communities have the resources to protect themselves from wildfires, drought and floods is critical to the long-term success of the Golden State,” McGuire said in a press release Monday.

    The language of the bill had been negotiated in secret over the last several months but did not become public until 9:57 p.m. Saturday.

    California taxpayers would pay the bond back with interest. An analyst for the Assembly estimated that the $10 billion bond would cost the state $650 million a year for the next 30 years or more than $19 billion.

    Scott Kaufman, legislative director at the Howard Jarvis Taxpayers Assn., said the cost could be much higher if the interest rate on the bonds turns out to be higher than the 5% rate the analyst used.

    “These bonds will be paid by people decades from now that didn’t even get to vote for their authorization,” Kaufman wrote to the bill’s author in a letter opposing the measure.

    Earlier this year, Sacramento legislators had proposals to place tens of billions of dollars of bonds on the November ballot for efforts as varied as stopping fentanyl overdoses and building affordable housing.

    But those plans were deflated in March when a $6.4-billion bond measure promoted by Newsom to help homeless and mentally ill people got 50.18% of the vote, barely enough to win approval.

    In a recent survey by the Public Policy Institute of California, 64% of likely voters said it was a “bad time” for the state to issue bonds to pay for state projects and programs.

    Dozens of environmental groups, renewable energy companies, labor unions, water agencies and social justice advocates have been lobbying state lawmakers to place the climate bond on the ballot.

    The lobbying intensified after Newsom proposed spending $54 billion on climate efforts in 2022 but then cut that funding to close recent massive budget deficits.

    According to the bill, $3.8 billion would be allocated to water projects, including those that provide safe drinking water, recycle wastewater, store groundwater and control floods.

    An additional $1.5 billion would be spent on wildfire protection, while $1.2 billion would go toward protecting the coast from sea level rise.

    Other money would be used to create parks, protect wildlife and habitats and address extreme heat events.

    The language requires that at least 40% of the money go to projects that provide benefits to disadvantaged communities, defined as populations where the median household income is less than 80% of the area average or less than 80% of the statewide median.

    Some legislators pulled their support of the bond, saying this provision had recently been weakened so that more money would go to people who were not financially disadvantaged.

    Jasmeet Bains (D-Delano) said before the Assembly vote that the definition of vulnerable populations had been diluted. “It’s fundamentally unjust,” she said.

    Hundreds of millions of dollars from the bond would benefit private industry. For example, it would provide $850 million to clean energy projects, including the proposed offshore wind farms. Those planned wind projects are already benefiting from subsidies in President Biden’s Inflation Reduction Act.

    Governments often take out long-term debt to pay for infrastructure projects that are expensive to build but will last for decades. Yet some of the planned climate bond spending would go to operate programs that could long be over by the time the bonds are paid off. For instance, a portion will go to “workforce development” or the training of workers.

    And up to 7% of the money or $700 million can go to administration costs.

    “We are already seeing the devastating effects of climate change — more extreme heat waves, catastrophic fires and floods, coastal erosion, and severe droughts,” Sen. Ben Allen (D-Santa Monica) said in a press release. “Every part of our state is affected, and unless we take action now, the cost to address these impacts will become increasingly overwhelming.”

    Melody Petersen

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  • Drownings rose among young children after decades of decline. It’s ‘highly concerning,’ CDC says

    Drownings rose among young children after decades of decline. It’s ‘highly concerning,’ CDC says

    During the pandemic years of shuttered pools and difficult-to-find swim lessons, the drowning rate of very young children increased significantly in the U.S., following decades of declines, according to a new federal report.

    Drowning rates among children 1 to 4 were about 28% higher in 2021 and 2022, compared to 2019, according to the U.S. Centers for Disease Control and Prevention. In 2022, 461 children ages 1 to 4 died in a drowning accident, which is the number one cause of death among babies and toddlers. Rates are not yet available for 2023 or 2024, so it’s unknown whether deaths have declined since then.

    Reading by 9’s guide to reading readiness. Find expert tips, book recommendations and resources for parents of kids under age 5.

    But children ages 1 to 4 already had the highest rates of drowning, even before the pandemic. The recent increase is “highly concerning,” said Tessa Clemens, a health scientist in the CDC’s Division of Injury Prevention and lead author of the new report.

    While the exact reason for the increase is unknown, the shutdown likely played a role, she said.

    “Many public pools closed during the COVID-19 pandemic, which limited the availability of swim classes. Once pools reopened, many facilities faced shortages of trained swimming instructors and lifeguards,” said Clemons. For many families, swim lessons and safe swim areas remained difficult to come by.

    In Los Angeles, lifeguard shortages have continued to be a problem. Last summer, some public pools cut their hours and swim lessons were canceled because lifeguards were so difficult to find. Pandemic shutdowns fueled the so-called “great resignation,” in which many college-aged lifeguards quit to return to school or seek work in other industries. Many never came back.

    Facing another likely shortage as summer approaches, the Los Angeles County Department of Parks and Recreation has increased lifeguard wages by 20% this year.

    Experts say water safety should be top of mind for families, especially in Los Angeles County, home to about 250,000 swimming pools, 96% of which are attached to single-family homes, according to a 2016 analysis.

    Cecilia Prillwitz drops her 7-year-old son at school.

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    The CDC recommends that families begin swim lessons early — even while their children are babies.

    “It’s never too young to really have that exposure to water to get comfort with it,” said Dr. Debra Houry, the CDC’s chief medical officer. “What I would say though, is even at that age if they do know how to swim, it’s still really important to have close parental supervision.”

    The CDC also recommends:

    • Building and revitalizing public pools to increase access to swimming for all people, including those with disabilities
    • Promoting affordable swimming and water safety lessons
    • Building fences at least 4 feet tall that fully enclose and separate the pool from the house
    • Not drinking alcohol before or during swimming, boating or other water activities.

    Overall, more than 4,500 people of all ages died due to drowning each year from 2020 to 2022 — 500 more per year compared to 2019. That’s one person every two hours. Native Americans and Black Americans have long been at greatest risk, the result of decades of segregation at public and private pools. Those disparities grew even worse during the pandemic.

    Almost 40 million adults (15.4%) in the United States do not know how to swim and over half (54.7%) have never taken a swimming lesson.

    “It’s never too late to take that swim lesson, to get those water safety skills, particularly as we’re going into the summer,” said Houry. “It can save your life, it can save your family member’s life.”

    This article is part of The Times’ early childhood education initiative, focusing on the learning and development of California children from birth to age 5. For more information about the initiative and its philanthropic funders, go to latimes.com/earlyed.

    Jenny Gold

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  • Did you buy a home with a high interest rate and intend to refinance later?

    Did you buy a home with a high interest rate and intend to refinance later?

    Ever since mortgage interest rates jumped in 2022, some Californians have had a strategy: Buy now and, once rates drop, refinance to save hundreds of dollars each month.

    The idea — pushed by some real estate agents — was supposed to be a trade-off. The buyer could pick up a home in a slower market, and though interest costs would be high, they wouldn’t stay that way.

    The strategy may still work, but so far, high borrowing costs are here to stay. In recent weeks, rates have climbed higher, surpassing 7% for the first time since last year.

    If you bought a home with this strategy, The Times would like to speak with you about how it has worked out.

    Andrew Khouri

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  • All-cash offers, wealthy buyers push Southern California home prices to a record

    All-cash offers, wealthy buyers push Southern California home prices to a record

    Southern California home prices hit a record in March amid sky-high mortgage interest rates, a combination that’s creating the most unaffordable housing market in a generation.

    The average for the six-county region reached $869,082 in March, according to Zillow. That’s up 9% from a year earlier and 1% higher than the previous all-time high in June 2022.

    With rates hovering in the upper 6% range, the mortgage payment on the average home now tops $5,500 — if you can put 20% down.

    “It’s bananas,” Tommy Kotero, a 43-year-old refinery worker, said last weekend after touring a dated, $899,000 house in north Torrance with visible cracks in the ceiling and walls. “The asking prices for what we are getting is crazy.”

    How home prices hit a record despite the high cost of borrowing is a tale of too few homes for sale, combined with a wealth gap that has equipped some buyers with reams of cash that negate the effect of high rates.

    When interest rates first soared in 2022, buyers backed away en masse, inventory swelled and home prices dropped.

    Then potential sellers all but went on strike, with many deciding they didn’t want to move and trade their sub-3% mortgages for a loan at more than double that rate.

    Inventory plunged and enough buyers returned to send home prices back up. Many of these buyers are well-heeled first-timers who aren’t ditching a low-cost mortgage.

    Others are holding on to their old home and buying another. Still more are selling their old home and turning their considerable equity into hefty down payments well over 20%.

    “People who have cash are not paying too much attention to interest rates,” said Alin Glogovicean, a real estate agent with Redfin who specializes in northeast L.A.

    He estimates that in about one-third of his deals a buyer is paying all cash. Another third put down at least 50%, with a mortgage on the rest.

    At least two-thirds of the buyers with down payments of at least 30% aren’t investors but people who want to live in the home, he said. They are professionals such as architects and Hollywood types who have saved, liquidated stock portfolios, built up equity or received help from family.

    Some are willing to dip into retirement savings — a strategy many financial experts advise against.

    Nationally, similar trends are afoot, according to a Zillow survey, with the share of home buyers putting at least 20% rising, as well as those who received help from family and friends.

    In all, 23% of L.A. County homes sold in February were bought with all cash, up from 16% in 2021, according to Redfin.

    For those without access to a spare half-a-mill, times are tougher.

    According to the California Assn. of Realtors, only 11% of households in Los Angeles and Orange counties could reasonably afford the median-priced house during the fourth quarter, the smallest number since the housing bubble of the mid-aughts.

    At that time, risky lending practices allowed people to buy homes they couldn’t really pay for. Today, lending standards are far tighter, which economists say should prevent a similar collapse in prices if there’s another recession.

    Across the region, home prices have now set records in Orange, San Bernardino, San Diego and Ventura counties. In Los Angeles and Riverside counties, prices are less than 1% from their all-time highs.

    Agent Alicia Fombona of United Real Estate Pacific States works across the Southland — from the coast to the Inland Empire. Amid high rates and high prices, she said, one strategy that’s growing more popular is co-borrowing: family and friends coming together to buy a house or duplex to keep payments somewhat affordable.

    “Everybody needs a place to live and there is not enough housing for everybody,” Fombona said.

    More homes are starting to come onto the market, but inventory is still tight and expected to remain so, according to forecasters. Rates may drop somewhat but are expected to remain elevated.

    That combination could create a scenario in which prices don’t soar but also don’t drop much — if at all, especially because incomes for many households are growing.

    “We are going to continue to see robust price growth, but nothing near where we were in the pandemic,” said Orphe Divounguy, a senior economist with Zillow.

    If rates fell considerably, it would immediately make homes more affordable, but a new crop of buyers probably would flood the market and could put even more upward pressure on prices.

    To help housing truly become more affordable, Divounguy said, there must be continued income growth and more housing construction.

    “The way out of this is not going to come from mortgage rates,” he said.

    In California, construction headed in the wrong direction in 2023, with building permits falling from the previous year, though lately there are signs of a rebound in single-family construction, which is mostly for-sale homes.

    Some Californians, however, are on a timeline.

    Kotero, the buyer looking in Torrance, currently rents a house in the city with his wife, Rikah, and their four children. But he said they need to find a new place by summer because the landlord is moving back in.

    They’d like to buy and stay in Torrance for the schools but so far have struck out — even though Kotero makes $160,000 as a manager at a local oil refinery.

    He said he and his wife were recently outbid, despite stretching their budget to offer $1 million for a house listed for $900,000.

    Unlike others, the Koteros don’t have hundreds of thousands in cash to meaningfully offset high rates. Instead, Rikah, who currently stays home with the children, is thinking of looking for a job.

    “If we are realistically looking to buy a home in Torrance, there’s no way around it,” Kotero said.

    Andrew Khouri

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  • Part of Palos Verdes Drive South damaged by landslide will close temporarily for repairs

    Part of Palos Verdes Drive South damaged by landslide will close temporarily for repairs

    Rancho Palos Verdes officials are preparing to close a section of Palos Verdes Drive South for repairs after the two-lane roadway suffered damage from an accelerating landslide complex that continues to wreak havoc on the coastal city.

    Palos Verdes Drive South is a major two-lane road that spans a 15-mile stretch of the California coast along which 15,000 vehicles pass every day, officials said. At the moment, visible cracks in the asphalt can be seen where the road has fallen into disrepair due to shifting sediment.

    “We’re doing short-term repairs right now,” said City Manager Ara Mihranian. But an “imminent road closure” will take place over the next month to address a “severe drop” in the roadway that locals call “the ski jump,” he said.

    Caltrans officials are recommending that this section of roadway be flatted out to some extent, Mihranian said. The section runs about a quarter of a mile between Narcissa and Peppertree drives. Details of the planned road closure and its repairs will be presented to the City Council on April 2.

    The Portuguese Bend Landslide Complex that underlies much of the city has been slowly shifting for decades, but over the last few months, the movement has increased alarmingly. Heavy rains over the past two winters have contributed to the problem.

    The land in some areas is descending towards the Pacific Ocean at a rate of about half an inch per day, according to Michael Phipps, a geologist working for the city. The landslide has already damaged some homes and recently forced the closure of the historic Wayfarer’s Chapel, a popular wedding site perched on a hillside overlooking the ocean.

    In a recent report presented to the City Council, Phipps found that the current pace is three or four times the rate recorded in 2023.

    A particular type of soil makes the Portuguese Bend especially vulnerable to landslides, Phipps said. Millions of years ago a volcanic eruption deposited ash that became bentonite clay. “When [bentonite] gets wet, it becomes even weaker,” said Phipps. “So we’ve really got the worst of all situations.”

    The city is using underground pumps called dewatering wells to drain the water table to help stabilize the land, officials said. The city has also halted development in certain affected areas. So far, Mihranian said, only two damaged homes have been marked as uninhabitable.

    The Federal Emergency Management Agency has awarded Rancho Palos Verdes $33 million dollars to help with remediation efforts. Now the city is proposing that $8 million of that money be allocated for emergency hydraugers, drains that would be bored into hillsides to release excess water.

    “There’s other discussions about trying to intercept the water that’s coming down to natural canyons up into the head of the landslide,” Phipps said. But all the city’s measures will at best only slow the landslide to imperceptible movement, not completely stop it, he said.

    Jireh Deng

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  • California’s home insurer of last resort sees enrollment surge, raising concerns over its finances

    California’s home insurer of last resort sees enrollment surge, raising concerns over its finances

    With home insurers scaling back coverage in the state, enrollment is surging in California’s backstop insurance plan — as is the plan’s risk of sustaining losses that it can’t cover.

    Victoria Roach, president of the FAIR Plan Assn., told lawmakers this week that property owners even in areas with low wildfire risk were finding it difficult to keep their homes insured as companies increased rates, limit coverage or left areas susceptible to natural disasters amid climate change.

    That has prompted thousands of Californians to purchase coverage through the state insurer as a last resort. Funded by the insurers doing business in California, the Fair Access to Insurance Requirement plan provides a limited policy as a fallback for property owners unable to find conventional coverage they can afford.

    Roach said the Fair Plan set a new record last month when it added 15,000 new policyholders.

    The FAIR plan has about 375,000 policyholders, and the insurer’s total risk exposure was $311 billion as of December 2023; it was $50 billion in 2018.

    “We’re one of the largest writers in the state right now in terms of new business coming in,” Roach said. “As those numbers climb, our financial stability comes more into question.”

    Roach said homeowners and businesses are typically insured by any of the state’s 118 standard insurers or 132 surplus line insurers, which specialize in high-risk insurance.

    “Unfortunately, as you know with the current state of the market, I think this is often reversed because there’s not a lot of options out there for people,” Roach told lawmakers during Wednesday’s Assembly Insurance Committee. “Instead, the FAIR plan is quickly moving to be the first resort for a lot of people.”

    She said consumers who would never have sought insurance through the FAIR plan in years past were now among the new policyholders, many of whom were not living in wildfire areas.

    The insurer’s expansion is the latest wrinkle in California’s ongoing insurance crisis, and it mirrors a similar trend across the country of major companies dropping customers in areas prone to wildfires, flooding and hurricanes.

    Florida’s state insurance of last resort, known as the Citizens Property Insurance Corp., has become the largest property insurer there, adding about 11,000 new policies in the last two weeks, according to local reports.

    In Louisiana, state officials have been trying to address an insurance crisis following a series of hurricanes in 2020 and 2021 that caused insurance companies to stop renewing policies or leave the state.

    Since 2022, at least eight insurers, led by State Farm and Allstate, have announced plans to stop offering home insurance to new customers or withdraw from the state entirely. Some blamed a spike in the cost of reinsurance — insurance policies that insurance companies buy to cover their big losses — and financial strains caused by inflation that have made materials and labor for home repair and rebuilding costly.

    The potential loss of insurers prompted Gov. Gavin Newsom to issue an executive order commanding the insurance commissioner to take action to address issues with the insurance market and expand coverage options for consumers.

    Insurance Commissioner Ricardo Lara’s response to the crisis is a set of new rules still being implemented that would allow insurers to raise rates to cover reinsurance costs and projected losses from catastrophic fires, but also require them to provide coverage for more homes in the canyons and hills. The proposals, which aim to move people off the FAIR plan and slow the increase in premiums, have won support from insurance industry trade groups and some consumer groups, but criticism from other consumer advocates.

    Under the existing system, insurers need to apply to the Department of Insurance to raise their average rates across the state and prove that the price hike is justified. The process allows consumer advocates to intervene to contest the insurer’s claims.

    This system was created when California voters approved Proposition 103 in 1988, but the insurance department went a couple of steps further than the ballot measure. Its rules barred insurance companies from including the cost of reinsurance in their rates and allowed the use only of historical loss data, rather than forward-looking simulations, to support a hike in premiums.

    Insurance industry representatives have been trying to lift both of those restrictions for years, but their calls have intensified as insurers have pulled back coverage in California.

    On Thursday, Lara proposed a regulation that would allow insurers to use catastrophe modeling that takes into account the projected impacts of climate change and other shifting factors when asking to raise rates.

    “We can no longer look solely to the past as a guide to the future,” Lara said in a statement. “My strategy will help modernize our marketplace, restoring options for consumers while safeguarding the independent, transparent review of rate filings by Department of Insurance experts, which is a bedrock principle of California law.”

    The proposed regulation comes a week after the Los Angeles County Board of Supervisors approved a motion demanding that Lara investigate the compliance measures that insurance companies require from homeowners to keep their coverage.

    “It’s no secret that insurance providers have become more conservative due to increased wildfire threats statewide,” said Supervisor Kathryn Barger, who introduced the motion, in a statement. “As a result, homeowners are increasingly being put in a very tough position: pay higher premiums and comply with varied, costly, and inconsistent mitigation requirements or lose your insurance.”

    She added: “I’ve heard from many of my constituents district wide who are facing steep cost increases or being dropped altogether by their insurance carriers and left to fend for themselves. That’s simply unacceptable.”

    In response to proposed expansion of catastrophe models, Consumer Watchdog, a consumer advocacy group that often intervenes in proposed rate hikes, said Lara’s proposed regulation limits transparency.

    “Black box catastrophe models are notoriously contradictory and unreliable, which is why public review and transparency are key before insurance companies are allowed to use them to raise rates,” the group wrote in a statement. “Commissioner Lara’s proposed rule appears drafted to limit the information available to the public about the impact of models on rates in violation of Proposition 103.”

    The group contends that the rule fails to spell out how the Department of Insurance would assess a model’s bias or accuracy and instead creates “a pre-review process that appears primarily focused on determining what information companies must disclose and what they may conceal from public view.”

    “California needs a public catastrophe model to ensure climate data is transparent and to prevent insurance price-gouging and bias.”

    Staff writer Sam Dean contributed to this report.

    Ruben Vives

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  • Recession Risks Fading, Business Economists Say, But Political Tensions Pose Threat To Economy – KXL

    Recession Risks Fading, Business Economists Say, But Political Tensions Pose Threat To Economy – KXL


    WASHINGTON (AP) — Just a quarter of business economists and analysts expect the United States to fall into recession this year.

    And any downturn would likely result from an external shock — such as a conflict involving China — rather than from domestic economic factors such as higher interest rates.

    But respondents to a National Association of Business Economics survey released Monday still expect year-over-year inflation to exceed 2.5% — above the Federal Reserve’s 2% target — through 2024.

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    Grant McHill

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  • Powell surprises with dovish turn; economists mull how many Fed rate cuts in '24

    Powell surprises with dovish turn; economists mull how many Fed rate cuts in '24

    Federal Reserve Chairman Jerome Powell startled economists with a press conference Wednesday that was viewed as much more dovish than expected.

    It was “12 doves a-leaping,” said Michael Feroli, U.S. economist at JPMorgan Chase.

    “The Fed can’t believe its luck. The data is going their way,” said Krishna Guha, vice chairman of Evercore ISI.

    The first dovish signals came in the Fed’s statement and economic forecasts at 2 p.m. Eastern. First, the Fed penciled in three rate cuts in 2024 instead of two that were projected in September. The Fed also softened its tightening bias by saying they were mulling the need for “any” more hikes.

    Then, half an hour later at his press conference, “Chair Powell did nothing to undo the impression of those signals,” said Feroli, in a note to clients. Powell said Fed officials were starting to discuss when to cut rates.

    “The question of when it will be appropriate to begin dialing back the policy restraint” was clearly “a discussion for us at out meeting today,” Powell said. Fed officials think the Fed is “likely at or near the peak rate for this cycle.”

    While Powell didn’t take rate cuts “off the table,” they are “collecting dust,” said Michael Gregory, deputy chief economist at BMO Capital Markets.

    Markets reacted with the 10-year Treasury yield
    BX:TMUBMUSD10Y
    falling to 4.025%.

    Traders in derivative markets now see an 80% chance of the first rate cut in March, and now see five quarter-point cuts next year.

    Matt Luzzetti, chief U.S. economist at Deutsche Bank, said the main thing learned from Wednesday’s press conference was that Fed Gov. Chris Waller’s dovish comments a few weeks ago were a reflection of the mainstream view at the central bank, rather than a dovish outsider.

    In a speech late last month, Waller raised the possibility of a rate cut by spring if inflation keeps slowing.

    Some economists think that March is too soon for a rate cut.

    “We still judge rate cuts will commence later rather than sooner, still by the end of the third quarter of 2024,” Gregory of BMO Capital Markets said.

    Feroli said he now sees the first rate cut in June, instead of his prior forecast of July, and predicted that the Fed will cut five times by the end of 2024.

    Luzzetti of Deutsche Bank sees six rate cuts next year, but not beginning until June as the economy falls into a mild recession.

    The Fed doesn’t forecast a recession. Its rate cuts are purely a story of weakening inflation. If there is a recession, the Fed will cut very fast, Luzzetti said.

    Diane Swonk, chief economist at KPMG, said the odds of a recession are lower now that the Fed has signaled it will actively take steps to try to avoid one.

    The Fed wants the economy to cruise at a lower altitude, and no longer wants a landing, Swonk said in an interview.

    That is a 180-degree turn from Powell’s speech in Jackson Hole, Wyo., in the summer of 2022 when he spoke for less than 10 minutes but warned of “pain” and the unfortunate costs of fighting inflation. That speech, “a bucket of ice water,” Swonk said, sent the stock market reeling at the time.

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  • DeSantis bragged about a COVID study during Newsom debate. Not so fast, lead author says

    DeSantis bragged about a COVID study during Newsom debate. Not so fast, lead author says

    During the Fox News debate between Florida Gov. Ron DeSantis and California Gov. Gavin Newsom, a study published in the scientific journal the Lancet was highlighted as vindication for the Sunshine State’s loose pandemic policies.

    As the two traded barbs over who was a “lockdown governor,” DeSantis crowed about his state reopening quickly and said: “In fact, the Lancet just did a study: Florida had a lower standardized COVID death rate than California did” when adjusted for how Florida’s population skews older and has higher rates of underlying illness, such as cancer and heart disease.

    With that adjustment, Florida ranks as having the 12th-lowest standardized death rate nationally among states, compared to the 14th-highest raw death rate.

    Some critics of the tough public health measures implemented in many states in response to the pandemic have seized on that finding as proof that strict practices such as stay-at-home orders, masking, limited vaccine mandates and social distancing weren’t needed to control COVID-19.

    But the study’s lead author says that’s the wrong takeaway.

    “If [DeSantis] is using the study as an example to support the message that masks, or staying at home, or vaccines did not matter in this pandemic, then that would be using the study inappropriately — because that is not what it shows,” said Thomas J. Bollyky, director of the global health program at the Council on Foreign Relations, a nonpartisan think tank.

    “The governor aggressively promoted those behaviors early. And the reality is even when he started to turn away from those behaviors in 2021, Floridians continued to adopt them, and at rates that exceeded the national average,” Bollyky said in an interview.

    Through mid-2022, Floridians ranked in the top half of states in vaccine coverage and mask use, and in the top quartile of states for reduced mobility (how often people stayed home compared to pre-pandemic times).

    Mobility statistics came from four sources of cellphone GPS data, which was used to calculate daily mobility relative to before the pandemic.

    Gov. Ron DeSantis, standing in mask, right, watches as a COVID-19 vaccine dose is administered at Jackson Memorial Hospital in Miami on Jan. 4, 2021.

    (Wilfredo Lee / Associated Press)

    In a follow-up analysis written by Bollyky and two co-authors on the website Think Global Health, there are several explanations as to why Florida did comparatively well relative to other states. Among them: The state “adopted early aggressive nursing home policies, testing, and gathering restrictions to slow the spread of the virus — at a higher rate than even most states led by Democratic governors — and promoted vaccination among the elderly.”

    “Early on in the pandemic, the governor was quite aggressive trying to reach out to the elderly population about the need to be cautious,” Bollyky said. “And those messages took hold.”

    The analysis — which covered the period from the start of the pandemic through the end of July 2022 — found that Florida’s early policies encouraged residents to continue to stay home, get vaccinated and wear masks at a higher rate than most other states, even after health mandates were lifted.

    Among the strict steps DeSantis undertook, the analysis said, was isolating COVID patients in nursing homes and banning visitors; closing schools in March 2020 and keeping them shut for the rest of the academic year; and telling residents to avoid gatherings that could turn into super-spreader events.

    People wear masks at Jackson Memorial Hospital in Miami.

    People wearing masks walk toward Jackson Memorial Hospital in Miami to receive the COVID-19 vaccine in January 2021. Florida was one of the first states to throw open vaccine eligibility to members of the general public over 65.

    (Lynne Sladky / Associated Press)

    “DeSantis was one of only four governors to reopen schools in the fall of 2020, but Florida was still otherwise slower to lift gathering restrictions and bar and restaurant closures than most Republican-led states,” the analysis said.

    And DeSantis was an early champion of COVID-19 vaccines for seniors, saying in January 2021, “we want the shots to go in the arms.” That’s at odds with his latest denigration, suggesting Floridians who got the recently updated vaccinations were “guinea pigs” for “shots that have not been proven to be safe or effective,” despite strong evidence to the contrary from the U.S. Centers for Disease Control and Prevention.

    News articles in late 2021 noted efforts by some local governments and residents to take precautions, including masking up. Miami-Dade County officials ordered county employees to either get vaccinated or submit to regular testing in response to the Delta wave in mid-2021. Public schools in Miami-Dade, Broward and Palm Beach counties had mask mandates in place through November 2021.

    During the first Omicron wave in late 2021, jury trials were paused in Miami-Dade County courts, and some concert promoters canceled events.

    Health-cautious behaviors persisted among a number of Floridians even as, between the Delta and initial Omicron surges in 2021, DeSantis moved to prohibit vaccine mandates and strike down mask mandates.

    In one notable example of the change in approach, the governor scolded students for wearing face masks during an indoor news conference in early 2022. “You do not have to wear those masks. I mean, please take them off. Honestly, it’s not doing anything. And we’ve got to stop with this COVID theater. So if you wanna wear it, fine, but this is ridiculous,” DeSantis told them. Some students took them off, while others kept them on.

    In early 2021, DeSantis began emphasizing a “medical freedom” agenda, the analysis noted, with his appointed surgeon general later defying federal recommendations and discouraging COVID-19 vaccinations. The analysis found Florida’s rates of overall vaccinations for schoolchildren fell to a 10-year low, and flu shot uptake for adults fell during the pandemic, even as they rose nationally.

    “If these trends persist and extend to other public health measures, the state will be less safe,” the report said.

    During last autumn and winter — a period not covered by the Lancet study — COVID-19 booster rates among Florida’s seniors lagged badly. As of late spring, only 31% had received the updated shot, below the national rate of 43%, and California’s rate of 48%.

    Complicating any comparison between Florida and California, however, is the multiple number of ways to calculate COVID death rates.

    There’s the crude death rate, to which Newsom alluded during the Nov. 30 televised faceoff with DeSantis. He said Florida had a 29% worse per capita death rate compared to California. A spokesperson later said that’s based on statistics from the CDC’s online COVID Data Tracker, which lists 110,208 deaths for California and 81,238 for Florida.

    When adjusted for population — 39 million for California and 22 million for Florida, per U.S. Census estimates in mid-2022 — the rates equal 365.2 COVID deaths for every 100,000 Florida residents and 282.4 COVID deaths for every 100,000 California residents.

    There are also age-adjusted statistics, which account for the fact that California’s population is relatively younger demographically than Florida’s. According to the CDC, Florida has an age-adjusted rate of 253 deaths per 100,000 residents, nominally higher than California’s 249 deaths per 100,000 residents.

    For 2021 — the deadliest calendar year of the pandemic nationally — the agency calculates Florida’s age-adjusted death rate at 111.7 for every 100,000 residents, about 12% worse than California’s.

    But then there is the Lancet study’s standardized rate cited by DeSantis, which was adjusted not only for age, but also for how Florida has higher rates of chronic illness. By that metric, Florida had a rate of 313 deaths per 100,000 residents — California’s was 34% worse, at 418 per 100,000 residents.

    Some contend that California’s pandemic policy was based in science and saved many lives; others assert Florida did a better job without curtailing rights; and still others say it’s foolhardy to compare the two, given vast differences that politicians and policymakers had no control over.

    In some camps, the narrative has become: “Florida did better than you might expect overall, but they did badly on vaccination when the Delta wave came up,” Bollyky said. But even that more nuanced take doesn’t provide a complete picture, he said.

    “Our study covered 2½ years. So to say [Florida] did bad for a three-month period of time of that is like saying they didn’t do well in the sixth inning, but did pretty well overall in the game,” Bollyky said. “That’s true, but also doesn’t really get at what the Florida story should be telling people — which is … that [officials] did their work early, and then the population continued to do its work.

    “And in some ways, the governor has failed to give himself credit for what he did early — for political reasons, presumably — and failed to give Floridians credit for what they did throughout the pandemic.”

    The original Lancet study also rebuts the perception that states that prioritized lives did so by sacrificing the economy and education. Virtually all states — whether led by Republicans or Democrats — instituted health mandates in the first months of the pandemic, Bollyky said. The big divide occurred after the Delta wave hit in summer 2021, when Democratic-leaning states were more likely to impose new pandemic policies.

    Notably, the Lancet study did not find any association between a higher or lower state gross domestic product and higher or lower coronavirus infections or deaths.

    “With the exception of restaurant closures, none of the policy mandates that we studied — stay-at-home orders, gathering restrictions, school closures, gym or pool closures, mask mandates, vaccine mandates — were associated with lower GDP or employment at the state level,” Bollyky said.

    In terms of the overall strength of the economy, “there was no choice between public health and the economy to be made. At least that’s not what our data shows,” Bollyky said. “You don’t see some nationwide association between ‘lockdown’ and ‘free’ states and better economies.”

    The pandemic coincided with declines in U.S. educational performance, the Lancet study said, but the data analyzed don’t indicate learning losses were systematically associated with primary school closures at the state level.

    “California, a state with long school closures during the pandemic, had test score declines similar to or smaller than those in Florida and Maine, states with low rates of school closures,” the study said.

    Rong-Gong Lin II

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  • Southern California home values near record despite the high cost of borrowing

    Southern California home values near record despite the high cost of borrowing

    Southern California home prices are nearing a record high at a time of sky-high mortgage rates, a double blow that’s hammering housing affordability across the region.

    In October, the average home price for the six-county region climbed 0.12% to $831,080, according to data from Zillow. It was the eighth consecutive monthly increase, leaving prices just 1% below the all-time high reached in 2022.

    “I don’t understand how people are affording these insane mortgages,” said Nicholas Uribe, a 31-year-old property manager who is trying — so far unsuccessfully — to buy a single-family home in the San Fernando Valley.

    Although prices are slightly lower than during the peak, a home is drastically more unaffordable. In October, the monthly payment on the typical L.A. County home was $4,830, according to Zillow. In June 2022, when prices peaked and rates were lower, the typical payment was nearly $900 less.

    Some experts say they don’t expect prices or mortgage rates to drop considerably in the near future — a forecast that, if realized, could dash the hopes of people like Uribe.

    In theory, he should be better off than he is. In 2019, he paid $329,000 for a Sylmar townhome that his agent now estimates is worth about $500,000.

    He’s also making more money. But despite his higher paycheck and home equity, he feels stuck.

    With interest rates roughly double what they were in 2019, Uribe said he could barely afford to buy a comparable townhome at today’s prices, let alone the single-family home he’d like to trade up to.

    With today’s rates, the top of his budget is about $500,000, which he said “gets you nothing in the San Fernando Valley.”

    On a recent afternoon, only three San Fernando Valley houses were for sale on Redfin priced at $500,000 or less. One was accepting only cash. All three were one- or two-bedroom abodes that were smaller than Uribe’s townhome and appeared run-down.

    The trend of declining affordability is playing out across the country. How the nation and Southern California arrived at this moment, experts say, is a tale of under-building, pandemic trends and federal monetary policy.

    During the height of the pandemic, people rushed to purchase a home, motivated by stay-at-home policies and mortgage rates driven to record lows by the Federal Reserve’s easy money policies. That demand surge collided with a shortage of homes for sale and caused prices to skyrocket.

    But as inflation soared, the Federal Reserve reversed course, tightening policy in a switch that helped send mortgage rates sharply upward. From November 2021 to November 2022, rates climbed from below 3% to 7%.

    Initially, prices in Southern California fell as shocked buyers backed away and inventory swelled. Then the flow of homes hitting the market ground to a near-halt.

    Increasingly, homeowners chose not to sell and give up their rock-bottom mortgages. Some like Uribe couldn’t afford to move. Others could but thought it a bad deal to pay so much in interest.

    When rates dropped into the 6% range and then stayed there for much of this year, it wasn’t enough to entice back many sellers. It did bring back a fair number of well-heeled buyers — especially first-timers without a mortgage — who decided they had put off their home purchase long enough.

    According to a Zillow survey done earlier this year, half of recent home purchasers were first-time buyers, which the real estate firm said is probably the highest share since around 2010 when a first-time buyer tax credit juiced demand.

    Demand for housing remains weaker than during the pandemic, but the combination of a little more demand and a lot less supply has been enough to push prices up.

    In Southern California, home prices bottomed in February. The median price has risen 8% since then to come in just under the all-time high of $839,674.

    In recent months, mortgage rates have surged past 7%, further crimping the budgets of potential buyers.

    According to the California Assn. of Realtors, only 11% of households in Los Angeles and Orange counties could afford the median-priced house in the third quarter, the lowest level since the mid-2000s housing bubble.

    Looked at another way, a median-income household in those two counties would need to fork over 76.5% of its income to afford the average-priced house in September, according to Intercontinental Exchange, a financial services firm.

    The September payment-to-income ratio is the highest level in a data set that starts in 1992 and contrasts with a long-term average of 35.6%.

    Andy Walden, vice president of enterprise research with Intercontinental Exchange, called today’s current levels of affordability unsustainable, but said that doesn’t mean prices will fall.

    “Sometimes a correction means home prices grow at a lower rate than incomes,” he said.

    That process could be underway. While prices rose in October from September, the increase was the smallest since values resumed their climb earlier this year.

    Nicole Bachaud, a senior economist with Zillow, said part of the current downshift is seasonal.

    Overall, Zillow predicts home prices across Los Angeles and Orange counties will dip 1.5% over the next year. In the Inland Empire counties of Riverside and San Bernardino, prices should rise 0.2%.

    Bachaud said home prices should be more or less flat because the lack of affordability will serve as a ceiling, while tight inventory will serve as a floor.

    A substantial increase in inventory could ease the experience for buyers, and there have been minor signs of improvement.

    In Los Angeles County, Redfin data show the number of new homes hitting the market each week is now 2% below year-ago levels, compared with 30% declines seen earlier this year.

    Experts said more homeowners may finally be done waiting and are choosing to sell. But buyers shouldn’t expect a surge of additional options any time soon.

    More than 60% of all U.S. homes with a first-lien mortgage have rates below 4%, according to Intercontinental Exchange data, and the gap between the rate homeowners have and the rate they’d get in today’s market is the largest since 1980.

    That gap — and the disincentive to sell that it brings — should shrink over time as more people decide they must move and rates retreat a bit, Walden said.

    “But it’s going to take years for that to take place,” he said.

    In the meantime, people wait.

    Shawna Jamison is one of them. She hoped to be out of her 565-square-foot San Diego condo by now, but a combination of personal and market factors have kept her there.

    The 37-year-old bought her San Diego unit nearly a decade ago, then a few years later moved to Orange County for a job promotion and rented the one-bedroom out.

    The plan was to transfer back to the San Diego office in several years and buy a bigger place in the city she loved. But the pandemic delayed office transfers and permanent work from home policies weren’t established, giving the software analyst pause about moving back south.

    It wasn’t until late 2022 that she got the OK to transfer to San Diego. She returned to her condo, but by then mortgage rates had surged.

    She’s searched for a larger home ever since, but can’t find anything within her budget.

    “I was waiting for my personal situation to align,” she said. “But as soon as my personal situation aligned, the interest rate situation is a disaster.”

    Andrew Khouri

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  • This former Fed insider has 3 big takeaways from Powell’s press conference

    This former Fed insider has 3 big takeaways from Powell’s press conference

    This former Fed insider has 3 big takeaways from Powell’s press conference

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  • U.S. economy seen growing at about a 2.2% annual rate in the July-September quarter, according to real-time New York Fed estimate

    U.S. economy seen growing at about a 2.2% annual rate in the July-September quarter, according to real-time New York Fed estimate

    The U.S. economy could expand at about a 2.2% annual rate in the current quarter, according to a revamped real-time estimate from the New York Federal Reserve released Friday.

    According to the weekly New York Fed’s Staff Nowcast, the economy has been on an upward trend since late July.

    The regional Fed bank had discontinued the real-time estimate during the pandemic. The New York Fed said the series will now be available weekly.

    The New York Fed’s estimate is much lower than the Atlanta Fed’s GDPNow model, which shows growth could expand at a 5.6% annual rate in the current quarter.

    Economists say the strength of the economy will be critical going forward in deciding whether the Federal Reserve needs to continue to raise its policy interest rate to cool inflation.

    The Fed has been expecting the economy to slow in the second half of the year. Fed officials forecast only 1% growth for 2023. In the first six months of the year, U.S. gross domestic product is averaging about a 2% growth rate.

    If the economy reaccelerates, it is likely that inflation will also move higher. Fed officials had been hoping that slower economic growth would continue push down inflation.

    Faster growth means “you are probably going to get some inflation numbers that aren’t going to be as good as people were anticipating,” said James Bullard, the former president of St. Louis Fed president and now dean of Purdue’s business school.

    “There is some risk that the Fed will have to go a little bit higher” even than the one more interest rate hike that the central bankers have penciled in this year, he said, in a recent CNBC interview.

    The first official government estimate of third-quarter growth won’t be released until Oct. 26.

    The picture of the health of the economy painted by U.S. GDP statistics can change quickly.

    The growth estimates for the first half of the year could be revised at the end of September when the Commerce Department releases benchmark updates to GDP data.

    The sharp revisions are one of the reasons why the Fed typically pays more attention to the unemployment rate and the inflation data.

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  • Fed’s Williams says monetary policy is in a ‘good place,’ recession talk ‘has vanished’

    Fed’s Williams says monetary policy is in a ‘good place,’ recession talk ‘has vanished’

    New York Fed President John Williams on Thursday sounded content with the current level of interest rates, but said he will be watching data closely to make sure the level of rates is high enough to keep inflation moving down.

    “We’ve done a lot,” Williams said during a discussion at a conference sponsored by Bloomberg News.

    “Right now, we’ve…

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  • Jackson Hole recap: Fed rate hikes likely on hold for ‘several meetings’

    Jackson Hole recap: Fed rate hikes likely on hold for ‘several meetings’

    Federal Reserve Chair Jerome Powell set a high bar for additional interest-rate hikes, economists said Sunday in their commentary on all the talk at the U.S. central bank’s summer retreat in Jackson Hole, Wyo.

    Michael Feroli, chief U.S. economist for JPMorgan Chase, said that the Fed chair certainly did not give a clear signal that more tightening was coming soon. He noted that Powell stressed the Fed would “proceed carefully” and balance the risks of tightening too much or too little.

    “We remain comfortable in our view that the FOMC will stay on hold for the next several meetings,” Feroli said.

    Read: Powell unsure of need to raise interest rates further

    The caveat to this forecast is if inflation surprises to the upside or the labor market does not continue to soften.

    Ian Shepherdson, chief economist at Pantheon, said that Powell’s speech seemed hawkish to some, particularly because the Fed chair made threats to hike again.

    But Shepherdson said he thought the Fed “is likely done.”

    “Behind the caveats, Mr. Powell’s speech fundamentally was optimistic, though cautious,” Shepherdson said.

    Boston Fed President Susan Collins also emphasized patience in an interview with MarketWatch on the sidelines of the Jackson Hole summit.

    Read: Fed has earned the right to take its time, Collins says

    Other regional Fed officials who spoke “hinted that further action may be needed, but also observed that inflation is moving in the right direction and that the surge in yields would help cool down the economy,” said Krishna Guha, vice chairman of Evercore ISI, in a note to clients.

    Traders in derivative markets expect a rate hike in November, but it is a close call, with the odds just above 50%.

    The Monday following Jackson Hole has historically been an active one in the markets, across asset classes.

    The 10-year Treasury yield
    BX:TMUBMUSD10Y
    ended last week just above 4.2%.

    Read: Market Snapshot on Powell’s stance

    The first test of the careful and patient Fed will come this coming Friday, when the government will release the August employment report.

    Economists surveyed by the Wall Street Journal expect the U.S. economy added 165,000 jobs in the month. That would be the weakest job growth since December 2020.

    In his speech on Friday, Powell emphasized that evidence that the labor market was not softening could “call for a monetary policy response.”

    Economists at Deutsche Bank think an upside surprise in the employment data could provide enough discomfort for the Fed, and raise expectations for further tightening.

    Other top global central bankers spoke at Jackson Hole, including European Central Bank President Christine Lagarde, Bank of Japan Gov. Kazuo Ueda and Bank of England Deputy Governor Ben Broadbent.

    Guha of Evercore said he detected a careful effort by the officials not to surprise markets.

    The exception to this rule might have been Bundesbank President Joachim Nagel, who said in a television interview that it was too early for the ECB to think about a rate-hike pause.

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  • Hate to spoil the party but there’s a new risk in town — a ‘no landing’ economy

    Hate to spoil the party but there’s a new risk in town — a ‘no landing’ economy

    For the last 18 months, all you’ve heard from the markets is that the U.S. economy is three months away from a recession. Now, the popular analysis is that that inflation is on a smooth glidepath down and the economy will never have a downturn again.

    Worries about a recession have evaporated, and all the talk is about a “soft landing,” with the Federal Reserve not having to hike interest rates more than once more, at most.

    But behind the scenes, in some economic circles, there is growing concern about another risk for the economy, dubbed a “no landing” scenario.

    What does “no landing” mean? Essentially it’s marked by economic growth that’s too strong to allow inflation to fall all the way to 2%, where the Federal Reserve aims for it to be, and therefore an economy that will need more Fed rate hikes, according to Chris Low, chief economist at FHN Financial.

    So instead of the U.S. central bank starting to cut rates early next year, there may be more rate hikes in store.

    “There is still considerable work to do before the inflation beast is fully tamed,” Low said.

    Former Fed Vice Chair Richard Clarida described the risk in crystal-clear terms. “If the Fed finds itself  in March 2024 with an unemployment rate of 4% and an inflation rate of 4% with some of that temporary good news behind them, they are in a very tough spot,” Clarida said in a recent interview with Bloomberg News.

    “It is a risk. It is not the base case. But if I was still there [at the Fed], I would be assessing it,” he added.

    So why does this matter? Why would the Fed be in such a tough spot? Two words: presidential election.

    A Fed that is dedicated to bringing inflation down might have to slam the brakes on the economy forcefully to get the job done. That gets tough during an election year, especially one that already seems poised to be filled with acrimony.

    “The Fed does not play politics with monetary policy. The FOMC will do what is right for the economy, election year or not. Nevertheless, FOMC participants are already sensitive to triggering a recession. Doing it in an overt way when Congress, a third of the Senate, and the White House are up for grabs would be reckless,” Low said.

    Andrew Levin, professor of economics at Dartmouth College and a former top Fed staffer, said “raising interest rates sharply in the midst of an election cycle could be a delicate matter. Even the vaunted inflation fighter, Paul Volcker [the Fed’s chairman from 1979 to 1987], decided to ease off the brakes midway through the 1980 presidential campaign.”

    Ray Fair, a Yale economics professor, thinks that, whether or not the Fed successfully lowers consumer-price inflation to the vicinity of 2% will be what really matters for the 2024 presidential election. If inflation does not go gently and the Fed is still fighting next year, it would likely be negative for President Joe Biden and the Democratic Party, he said.

    See: Inflation could rebound later this year. And that might be a good thing.

    To avoid hiking rates next year, the Fed, in Low’s view, will raise interest rates to 6% by the end of this year. That is an out-of-consensus call. Financial markets think the Fed is done hiking with its benchmark policy interest rate in a range of 5.25% to 5.5%.

    Many economist and the financial markets are talking more about prospective Fed rate cuts in early 2024 than any more hikes.

    Asked during a recent radio interview if he thought a “no landing” scenario was taking shape, Philadelphia Fed President Patrick Harker replied: “I don’t think so.”

    Harker said the economy was likely on track to return to the low-interest-rate and low-inflation environment of 2012-19.

    “I think about this a lot, and I asked myself what’s different fundamentally about the U.S. economy now then the way it was before the pandemic,” Harker said. He concluded that there wasn’t much difference.

    The big trend Harker mentioned was demographics, with baby boomers still moving in large numbers into retirement. “I don’t think we have to stay in a high-inflation regime. I think we can get back to where we were,” he said.

    Steve Blitz, chief U.S. economist at research firm GlobalData.TSLombard, said he puts the probability of a “no landing” scenario at about 35%.

    Blitz added it was a common mistake for economists, policy makers, traders and journalists “to presume that the expansion to come is going to look like the expansion that was.”

    “At least in the United States, that was never the case,” he added.

    Blitz said that if the U.S. economy were growing at a rate below 2% with an inflation rate higher than 3%, the Fed would have to raise the policy rate to about 6.5%. But if the economy is humming along with 3% growth and inflation over 3%, that would be a trickier spot. “Does the Fed really want to slow that down?” he asked.

    See: The U.S. economy is aiming for a three-peat: 2% GDP growth

    The range of possible outcomes for the economy remains wide. Some economists still believe that a recession early next is the most likely outcome.

    Other economists, like Michelle Meyer, chief U.S. economist at Mastercard, think the economy will continue to grow, with inflation coming down. Meyer described that outcome as “a soft landing with bumps.”

    Stephen Stanley, chief economist at Santander U.S., said he thinks the U.S. economy will “muddle through” next year with subpar growth in the range of 1% for several quarters and inflation slowing gradually.

    “Obviously, that optimism melts away if we’re back to readings of 0.4% and 0.5% on core CPI in three months or six months,” Stanley said.

    Economic calendar: See what’s on the U.S. economic-data docket in the coming week

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  • Some Fed officials pushed for June rate hike, minutes show

    Some Fed officials pushed for June rate hike, minutes show

    There was support from an unspecified number of Federal Reserve officials for an interest rate hike at the central bank’s policy meeting in June, according to a summary of the discussions released Wednesday.

    “Some participants indicated that they favored raising the target range for the federal funds rate 25 basis points at this meeting or they could have supported such a proposal,” the minutes of the June 13-14 meeting said.

    These…

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