Euro Climbs As New Home Sales Fall
Friday was a non event in the stock market. Much to be expected. People are really winding down, and looking forward to their Wall St. bonuses that are 14% higher than last year. Have you ever asked yourself why it’s higher this year?? The financial companies are doing terribly – in the financial details. Kind of crazy. (This could be why the financial companies are stringing out the bad news about their write-offs = to get bigger bonuses.)
Bond values increased significantly (lower interest rates) because people are still worried about the world – especially Pakistan. Keep watching that spot in the world. The full story hasn’t come out yet. If Bhutto was killed by the current leader, you can expect a real bloody riot that will last weeks. If it was Al Qaeda that killed Bhutto, that will be different. Maybe the US can capitalize on an Al Qaeda killing. We’ll see.
Gold took off and is streaking to new highs!!!!!! Oil and gas kind of had little change, but are still high.
The big mover was the Euro. It went thru $1.47, and is now set to test its old highs of just less than $1.49. That test should happen within the next 2 weeks. All other currencies are now climbing against the Dollar too. The Yen finally got on the band wagon, and is set to test 112.
And the Bad News was New Home Sales.
Sales of new one-family houses fell to a 12-year monthly low. The seasonally adjusted annual sales rate was…far below consensus. Oct data was revised downwards…This is down 9% from October’s levels. [Y-o-y]’07[sales] were 34.4% lower than [Nov 06]. That’s the largest [y-o-y] decline since 35.3% in January 1991…[The numbers] are a measure of contract signings, and do not reflect canceled contracts. Actual numbers are likely lower, as cancellation rates have been running as high as 40%….The WSJ noted that ‘the median price of a new home decreased by 0.4% [y-o-y] 2006. The average price advanced by 0.5%….’Of course, these reported prices don’t reflect the REAL price, as homebuilder incentives and giveaways do not show in this data. Builders have been throwing in free granite.
Friday’s Closing Details
DJ30 – 13,366 (Up 6 points)
10 Year Treasury Bond – 4.10% (Down 0.10%)
Euro – $1.4729 – another BIG move by the Euro – breaking thru 1.47.
Gold – $843/ounce (Up $11) – gold looks like it is exercising its muscles.
Oil – $9600 (Down $0.62)
Gasoline – $2.46 (Down $0.04)
