Pending Home Sales Rise
Stocks went up today, but for irrational reasons. Bonds moved sideways.
The Dollar and oil and gasoline all moved sideways too – all are trapped in an up and down sideways movement.
Gold moved up slightly – but could be considered sideways too.
In the (bad) news today…..
Pending Home Sales rose 2.1% in February. But, this is after the all time low in January, so February is actually a very low number. Pending Home Sales are signed contracts for existing homes, but they haven’t closed escrow yet. They are a forward looking statistic, as the closing takes one or two months from the date of the signed contract. Almost half of these house purchases are estimated to be “distressed” sales – like foreclosures, etc.
Construction Spending fell 0.9% in February. Construction spending has fallen 5 months in a row. While a decrease in construction spending hurts our overall economy, it actually helps our housing problem as less houses/apartments are being built, and we must work off the “for sale” inventory before we get back to a stable market.
Manufacturing Index rose – but it is still indicates a contracting sector of our economy. So, this is really bad news. Stocks naturally thought this was just ducky, so they rose on the news.
Tonight’s Dinner Conversation….
Let’s say that the majority of banks in the US are just fine, and are lending money and making money. Let’s say they buy the big banks, and make them solvent too as the smaller banks are the only ones who really know what they’re doing – and this is a fairly true statement.
Now let’s say they are so successful that they pay back all the TARP money with interest.
Now let’s say they provide enough money to buy the new GM and they start making money on that loan too.
April Fools – I was just dreaming.
Here are the last numbers for today:
Dow Jones 30 Industrial – 7761 (up 153 points)
10 Year Treasury Bond – 2.66% (down 0.03%)
Euro – $1.3232
Gold – $928 (up $3)
Oil – $48.39 (down $1.51)
Gasoline – $1.37 (down $0.05)