Archive for May, 2010

I like being right. Not twenty four hours after I warned that we should expect home prices to drop this year, the Case Shiller index was released for March showing a 0.3% decline. This was a tad better than February’s 0.9% decline, but it continues to demonstrate that the housing market still has a way… »

I will be going away for the summer at the end of this week which leaves little time for further commentary until later this year. So I want to give my view of where we are in this recovery, and what I think are the remaining issues to be faced.
First, let’s all recall that the… »

Today’s news that sales of existing homes rose 7.6% in April is deceiving. There seems to have been a late surge in sales because the tax credit which was part of the stimulus was finally being eliminated. The prospect of the credit going away brought a burst of activity out of proportion with the underlying… »

That will teach us. Never get too carried away with optimism. The economy is still struggling mightily. This morning’s report on new claims for unemployment assistance was awful. There is no way around the bad news. Claims jumped up 21,000 to 471,000 last week, ending a short string of weeks where things had been moving… »

Let’s not get too carried away with today’s consumer price report – the CPI fell 0.1% in April – but perhaps we should be more alert. Clearly the US economy is undergoing massive “disinflation”. The annual rate of inflation for the past twelve months was just 0.9%, the lowest since 1966. Prices fell across the… »

If you simply read the headlines you would come away with a distorted view of today’s housing reports from the government. The Financial Times typifies the way in which the good news gets plastered all over the place, and the bad/worse news is buried for only the  diligent to locate. The headline reads: “US homebuilding… »

It just occurred to me, and forgive me if you already realize this, but: at the present rate of job creation, we will, in two months, have added more jobs to the economy than we did in the entire Bush administration. All eight years of it.
I know it’s a very low bar to hurdle over…. »