Refocusing Our Priorities

Wallet Hub, a financial education and services website, published an article ranking the 50 states based on each state’s economy.  They compared the 50 states and the District of Columbia across 28 key indicators of economic performance and strength.  Their data set ranges from GDP growth and the unemployment rate to startup activity and the share of jobs in high-tech industries.  This is not another story of Hawaii coming in last, because we didn’t.  We came in 7^th from the bottom.

 

A strong economy is not only good for the state and the businesses which reside in them, a strong economy is vital to the health and wellbeing of its residents.  Chip Lupo, an analyst for Wallet Hub summed it up this way “…Factors like a low unemployment rate and high average income help residents purchase property, pay down debt and save for the future.  The best state economies also encourage growth by being friendly to new businesses and investing in new technology that will help the state deal with future challenges and become more efficient…”

 

But as I read through what each state at the top had in common, one factor was clear in every state with a strong economy:

 

Massachusetts

Massachusetts has the best state economy, and it invests a lot more in both industry and academic R&D than most other states, which leads to big payoffs in economic growth.  The Bay State has a lot of workers in industries that propel the economy forward, too.  It has the highest share of jobs in high-tech industries and the third-highest share of STEM professionals.

 

Washington

Washington has the second-best state economy in the country, and it has the second-highest amount of industry R&D investment per capita, which allows it to be at the forefront of new tech.  In fact, Washington has the second-highest share of jobs in high-tech industries and the second-highest share of STEM (Science, Technology, Engineering & Math) professionals.

 

Utah

Utah has the third-best state economy, and at over $91,600, the median annual household income in the state is the highest in the country after adjusting for the cost of living.  The state also has the seventh-highest share of STEM professionals, reflecting a highly skilled workforce.

 

 

Unfortunately, Hawaii’s economic focus is to play host to visitors from economically vibrant states, instead of being one.  You might wonder how Hawaii could compete with these other states for R&D jobs, but that’s where we’ve been misled.  Hawaii could be at the forefront of many industries our leaders continuously ignore.  Ironically, because of our geographic remoteness and unique issues, we could be a driving force for new breakthroughs in many industries.

 

Energy:

We could lead the world in geothermal energy, wave energy, along with advances in wind and solar.  All that energy needs to be stored somehow, and that means cutting edge battery technology is needed as well.

 

Bioengineering:

Bioengineering is the ability to manipulate the DNA of plants and animals for a desired outcome.  A meatier chicken is not an issue important to Hawaii.  We have serious problems with invasive species that need bioengineers to determine a way to eradicate them.

 

The Coconut Rhinoceros Beetle is not going away.  It will destroy every coconut tree in the state.  And when they are done with coconut trees, they’ll move onto other agriculture.

 

Invasive plants, like the Albizia trees need eradication.

 

Molokai’s ranchers are nearly extinct because there’s no easy effective way to test for bovine tuberculosis.

 

 

Farming:

Hawaii is a unique place in that we sit in the middle of the biggest ocean “farmland” in the world (the Pacific Ocean).  Attempts have been made in the past to raise expensive prized tuna in large ocean netted enclosures.  More needs to be done to make ocean farming viable.

 

If the Molokai deer can be eradicated of TB, we could have a thriving venison industry.

 

We could also raise sheep for meat and wool.

 

Hawaii currently provides less than 10% of the beef we consume in the state.  Advances in farming could increase that figure and make us less reliant on mainland imports.

 

 

The Solution:

What Hawaii lacks is the facilities and people to find solutions to our economic problems.  Ironically, if we can solve Hawaii’s problems, those solutions are viable in areas around the world.  But it all starts with having the people required to take on these tasks.  These people need to come from Hawaii’s school system.  We need to beef up the funding for STEM in the public school system.  The University of Hawaii system needs more funding to garner more research dollars from the federal government and the private sector.  And not unlike what we do for the film industry, we should offer tax credits to private companies that will open here in Hawaii to tackle these problems.

 

If you want to read further how Hawaii fared against the other 49 states, here’s a link to the article:

 

https://wallethub.com/edu/states-with-the-best-economies/21697

 

 

 

 

Pizza Sadness

Here’s a quick fact most of us already know.  Pizza is supposed to be cheap and family friendly – and that isn’t the case here in Hawaii.  What I didn’t know is just how much more expensive it is here than in other parts of the country.

 

Yes, this is another story where Hawaii comes in at #1, when being at the top is not the place you want to be.

 

https://www.netcredit.com/blog/pizza-cost-by-state-and-city/

 

 

 

My Love is like a Mango

That’s what Mana’o Company sang, and that song runs through my head every mango season.  Except this year there’s something different.  I’m not sure if it’s the economy or a change in common decency, but I’ve noticed more theft this year than any other.

 

They come in the middle of the night.  One day you’re watching the perfect mango ripen, and the next day it’s gone.

 

Have things gotten so bad here that stealing neighborhood mangos is now a cottage industry?  Auwe!

 

 

 

 

And now the week’s economic news…….

 

Higher Inflation

Mortgage markets remained highly sensitive to movements in energy prices this week.  While the latest inflation reports reflected the impact of rising oil costs, investors largely anticipated the increase, and the reaction was minor.  Mortgage rates ended the week slightly lower.

 

The Consumer Price Index (CPI), one of the most closely watched inflation indicators, showed that prices rose 0.5% in May from the previous month, matching expectations.  CPI was 4.2% higher than a year ago, up substantially from an annual rate of 3.8% last month to the highest level since April 2023.  Of note, the annual increase in average hourly earnings in May was 3.4%, meaning that wage gains are no longer keeping pace with inflation.

 

To reduce short-term volatility and get a clearer picture of underlying inflation trends, investors look at core CPI, which excludes food and energy.  In May, Core CPI was 2.9% higher than a year ago, up from 2.8% last month and the highest level since September 2025.  Shelter (housing) costs were up 3.4% on an annual basis and continue to be a primary reason why bringing inflation down to the 2% target of the Fed remains challenging.

 

A different inflation report released this week, which measures wholesale costs for producers, also reflected the rise in energy prices.  The May Producer Price Index (PPI) rose a massive 1.1% from April, far above the consensus forecast for an increase of 0.7%.  A record monthly surge of 2.8% in the price of goods, which are mostly products related to energy, accounted for roughly 80% of the rise in the index.  PPI was 6.5% higher than a year ago, up sharply from an annual rate of 5.7% the prior month and the highest level since November 2022.  Its impact was relatively minor, however, as investors tend to place a lot more weight each month on the Consumer Price Index report, which better reflects overall inflation levels in the economy.

 

On Thursday, the European Central Bank (ECB) raised its benchmark interest rate by the anticipated 25 basis points to 2.25%, marking its first rate hike since 2023.  Policymakers cited rising energy costs and their potential impact on food, goods, and services prices.  The ECB also acknowledged increased uncertainty stemming from ongoing geopolitical tensions in the Middle East, which could create additional inflation pressures while weighing on economic growth.  Investors currently expect further rate increases from the ECB in the coming months.

 

 

 

Next Week

Looking ahead, attention will remain fixed on the conflict in the Middle East.  In addition, the next Fed meeting will take place on Wednesday.  No change in rates is expected, and investors will be closely analyzing the commentary for clues regarding future policy adjustments.  For economic data, Housing Starts and Import Prices will come out on Tuesday.  Retail Sales will be released on Wednesday.  Since consumer spending accounts for over two-thirds of U.S. economic activity, the retail sales data is a key measure of the health of the economy.  Mortgage markets will be closed on Friday for Juneteenth.

 

Until next week….

 

*** Please note that Freddie Mac publishes their weekly rate report on Wednesday mornings from data received Monday and Tuesday. 

The graph above is intended to shown rate trends, and not “today’s current rate”. ***

 

 

Reviews From Our Past Clients

With every client, we promise to provide you with a comprehensive analysis of your mortgage needs, the best service possible, and the best rates we can find.  We make it our mission to have every transaction close with our clients happy with the service we provided.  Browse through the hundreds of reviews we’ve received from our clients posted on both Google and Zillow.com, and read what they thought of their experience using Hawaii Mortgage Company.

 

 

Google Link:

Hawaii Mortgage Company Review on Google.com

 

 

Zillow.com Link:

Hawaii Mortgage Company Reviews on Zillow.com

 

 

 

Our Rate Quote System is Available to You

Our automated rate quoting system is live.  Now you can check rates and try different scenarios 24-hours a day.  Remember, it’s just a computer.  For non-standard rate quotes, such as construction, vacant land, and other specialty programs, you’ll still need to give a call.

 

Here’s the link:      https://www.hawaiimortgage.net/todays-rates/

 

 

Do you think all lenders are the same?

There is a difference when you use Hawaii Mortgage Company for your financing.  Here’s a short video telling you why:

 

https://youtu.be/c7AKQ5wa2_U

 

 

 

Broker vs. Banker?

Click the link below to get a quick lesson on why working with a Mortgage Broker will benefit you on your next transaction.

 

https://youtu.be/iH3igW5v2jE