Existing home sales drop 3.8%

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From CNN/Money:

Sales of existing homes fell in May, as severe weather and high gas prices weighed on the shaky housing market.Home sales fell 3.8% to a seasonally adjusted annual rate of 4.81 million, down from a revised rate of 5 million in April, the National Association of Realtors said Tuesday.
Sales were more than 15% lower than in May 2010.



More “unexpected” news. Glad we are in a recovery, folks. :eek:
 
There is just too much economic uncertainty.

The Obama administration is working overtime to shut down the energy sector. Coal. Oil. Natural gas. Nuclear. Those forms of energy have proven to be long term reliable with reasonable costs.

They are pushing for solar and wind which are expensive, unreliable boutique sources.

Until the Obama administration is voted out and some sense of reasonability is restored, then people are going to continue to hunker down.

Employers are going to continue to hold off on any expansion plans and any hiring … Boeing is being sued … biggie employer … by the government. We have shut down our domestic light bulb plants and are getting those curly mercury bulbs that if you break them you are supposed to call out the hazmat teams … and we get those curly bulbs from China.

We could stop importing oil … OPEC is frightened that we might actually do that.

If Saudi Arabia sees their oil sales go down, they would be forced to stop subsidizing terrorism. Ditto, Iran.

Read Robert Bryce’s “Power Hungry” and visit www.energyvictory.net

We can grow our way out of this mess, but the Obama administration won’t let us.
 
markomalley said:
More “unexpected” news. Glad we are in a recovery, folks. :eek:
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UNEXPECTED! ahhaa

Every week with the new unemployment claims is "unexpected’… every bit of bad news is always labeled ‘unexpected’… of course its never labeled that under a Republican.

Summer Recovery! uh… never mind, that was last year.
 
Stjudeprayforus said:
UNEXPECTED! ahhaa
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The word “unexpected” does not appear anywhere in the linked story, BTW.
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Stjudeprayforus:
Every week with the new unemployment claims is "unexpected’… every bit of bad news is always labeled ‘unexpected’… of course its never labeled that under a Republican.
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This is simply not true. Anytime – under any administration, Republican or Democrat,
– economic data is about to be released, there is a level that data is “expected” to meet. It’s called a consensus of opinion among the economic experts. Anytime the actual data falls significantly above or below that “expected” level, it is classified as “unexpected”, and therefore generates a positive or negative surprise.
 
gnjsdad said:
The word “unexpected” does not appear anywhere in the linked story, BTW.

This is simply not true. Anytime – under any administration, Republican or Democrat,
– economic data is about to be released, there is a level that data is “expected” to meet. It’s called a consensus of opinion among the economic experts. Anytime the actual data falls significantly above or below that “expected” level, it is classified as “unexpected”, and therefore generates a positive or negative surprise.
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Keep telling yourself that.
 
Stjudeprayforus said:
UNEXPECTED! ahhaa

Every week with the new unemployment claims is "unexpected’… every bit of bad news is always labeled ‘unexpected’… of course its never labeled that under a Republican.

Summer Recovery! uh… never mind, that was last year.
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The other thing you won’t hear much of is when the optimistic unemployment or optimistic growth numbers are quietly revised at the end of the month. The revisions show how bad things really are, but the media won’t tell you about it.
 
Scott_Lafrance said:
The Fed won’t let it deflate. They keep pumping it up with cheap money and easy credit.
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And yet they have no qualms about that cheap money decimating the incomes of of those savers who have accumulated savings in the hope of living on the interest in retirement. I know some people who are by no means rich, and whose income has been cut in half or worse. That of course, was after their IRA’s were decimated in 2008.
 
JimG said:
And yet they have no qualms about that cheap money decimating the incomes of of those savers who have accumulated savings in the hope of living on the interest in retirement. I know some people who are by no means rich, and whose income has been cut in half or worse. That of course, was after their IRA’s were decimated in 2008.
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And consider how house values have dropped. For many people, there biggest investment is in their homes.
 
Scott_Lafrance said:
The Fed won’t let it deflate. They keep pumping it up with cheap money and easy credit.
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I agree.

Until they let it hit the bottom without regulations of margin requirements and interest rates, the housing market will never “recover.” But a good sign is that over 30% of sales are on a cash basis and climbing. I think everyone expects a full recovery to mean their homes will again be at all-time highs but this isn’t being realistic. 2005-6 just wasn’t sustainable.
 
JimG said:
And yet they have no qualms about that cheap money decimating the incomes of of those savers who have accumulated savings in the hope of living on the interest in retirement. I know some people who are by no means rich, and whose income has been cut in half or worse. That of course, was after their IRA’s were decimated in 2008.
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I agree that this is a problem which is getting worse. As these 5-6% CD’s are coming due, they will be losing income. (New 5 yr CD’s get about 2%, well below their true inflation rate.) True they can reinvest in 3-4% bonds or high-yielding stocks, but those carry much more risk, which conservative investors won’t consider. And to make matters worse, FDIC is broke. And so will the US the way Bernanke is pounding the dollar.
 
ProVobis said:
I agree that this is a problem which is getting worse. As these 5-6% CD’s are coming due, they will be losing income. (New 5 yr CD’s get about 2%, well below their true inflation rate.) True they can reinvest in 3-4% bonds or high-yielding stocks, but those carry much more risk, which conservative investors won’t consider. And to make matters worse, FDIC is broke. And so will the US the way Bernanke is pounding the dollar.
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CHY is a closed-end money market bond fund.

Pays almost 8%.

Been around a while.

But the key is to make sure you get it for a good price.

If you buy it … make sure you do not buy “at the market”. You must specify the price you are willing to pay. And you need to keep an eye on the market price for both buys and sells.

google.com/finance?client=ob&q=NYSE:CHY

Play with this …it’s a three year price history of CHY.

stockcharts.com/h-sc/ui?c=chy,uu[w,a]dallyyay[df][pg20!b200][vc60][iuk14!la12,26,9]

I wouldn’t buy it … at least not when it’s at a high.

But keep an eye on it.

Study it and the rest of the bond funds.

Normally I do not recommend buying bond funds. Because you can get caught on the price swings.

You have to study the market.

stockcharts.com/h-sc/ui?c=chy,uu[w,a]dallyyay[df][pg20!b200][vc60][iuk14!la12,26,9]

You have to type the whole line onto the address line.

SHY is another one to look at.

But these are not buy and forget financial instruments. You have to work.
 
Scott_Lafrance said:
The Fed won’t let it deflate. They keep pumping it up with cheap money and easy credit.
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Yes, but sometimes they look like an EMT trying to shock a dead patient back to life.

There’s also the problem that the banks are now running scared of the regulators. They were blamed for making bad loans and not applying stricter credit standards. Now there’s a regulatory backlash. No bank now wants to be accused of making bad loans, so they are less willing to loan, making home loans harder to get. Oversupply of homes, falling prices, scared lenders. I don’t know if that patient can be revived just yet.
 
Funny how all the punditry seems to move towards letting “the market settle on a floor”. In other words, let the little folks that bought homes get hosed. The banks didn’t have to “let the market settle on a floor”; they got a bailout, and it was a bipartisan payoff.

Instead of hearing these facts, we keep hearing that we need to let home prices drop and people will just have to suck it up. I’ll suck it up if the banks go along with it (and you can add the legislators too for punishing people that save money and pushing them to invest in things like real estate for tax purposes).
 
i live in a southwestern state that was hit very hard by the real estate collapse. my house is worth as much or less than what i paid for it 20 years ago. i have worked through the shock and the anger and really don’t have an idea when the prices will ever begin to go up on our real estate values because of the number of foreclosures. i am not sure if it is even worth hanging onto anymore. currently it is rented, but it is a headache to have tenants
and sometimes i just want to walk away and forget about how good i felt for 20 years making house payments every month and feeling like i was doing something good.
i feel like the american dream is gone.
 
7_Sorrows said:
i live in a southwestern state that was hit very hard by the real estate collapse. my house is worth as much or less than what i paid for it 20 years ago. i have worked through the shock and the anger and really don’t have an idea when the prices will ever begin to go up on our real estate values because of the number of foreclosures. i am not sure if it is even worth hanging onto anymore. currently it is rented, but it is a headache to have tenants
and sometimes i just want to walk away and forget about how good i felt for 20 years making house payments every month and feeling like i was doing something good.
i feel like the american dream is gone.
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My grandfather used to say the only people who are always wrong in their economic predictions are those who say something is forever and those who say “never”.

Ultimately, things will turn around, but I don’t think it can improve very much while the radicals are in power in Washington. Everybody is too afraid of them to take any kind of risk.
 
How could we expect them to rise?people are poorer today And with this economy who knows how bad inflation may become.Everythings going and it could get much worse.
 
Ridgerunner said:
My grandfather used to say the only people who are always wrong in their economic predictions are those who say something is forever and those who say “never”.

Ultimately, things will turn around, but I don’t think it can improve very much while the radicals are in power in Washington. Everybody is too afraid of them to take any kind of risk.
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Agreed.

When people take it for granted that something will always happen its time to make other plans. Everyone thought the US would go through a sizable recession but come roaring back in two or three years because thats what always happens (except for the Depression). Guess what, it aint happening this time.
 
SamH said:
Agreed.

When people take it for granted that something will always happen its time to make other plans. Everyone thought the US would go through a sizable recession but come roaring back in two or three years because thats what always happens (except for the Depression). Guess what, it aint happening this time.
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I don’t have a crystal ball anymore than anybody else does, but it really is my belief that if Obama loses in 2012 and if even one of the houses of congress is solidly Repub, the economy would go screaming off the reel, as it were. I honestly believe the fear of radicalism is what is keeping this economy down. Regardless, it would be a delicate thing because an improved business environment in the absence of significant deficit reduction would cause bond rates to increase significantly; therefore interest rates generally.

On the other hand, I really do believe if Obama is re-elected, and if there is significant Democrat power in the Senate or House, we’re in for a worse time than now. I don’t think the radicals have done their worst yet.
 
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