Aggregator • MaxedOutMama • ID=88921 |
The Volcano of Recession Is Rumbling - MaxedOutMama Jun 23, 2014, 1:00 pm
The last strong leg holding us out of a decline is autos. It's not clear to me how long that can stand, esp. given the administration's fixation on honeybees, dreamers and increasing consumer and business power costs.
There is only one chart you really need to look at to understand why the ground seems to be quivering. I did not make it.
Here, from our dear NAR is a graph of May's existing home sales YoY broken out by sales price:
Now compare this to the CW rhetoric:
'While the housing market has improved dramatically overall compared to where it was a couple of years ago, the recent recovery has been a little more choppy,' Chief Executive Officer Ara Hovnanian said during an earnings conference call on June 4.Well, it appears that starter homes ain't exactly where the market is, right?
Household formation will be the primary driver of long-term housing demand, he said and 'the creation of well-paying jobs will go a long way' toward boosting the market. 'Given the low levels of total U.S. housing starts, we remain convinced that we are still in the early stages of the housing industry recovery,' Hovnanian said.
In other news, the Clintons aren't really well off! Fortunately, oil and gas prices are rising nicely, which should help to stimulate a few more sales in that 1 mil plus price range.
Existing home sales are down 8.2% YoY for May if you look at the raw numbers. You can get all the NAR stats here.
The economy is not in a recession now, but it's losing steam rapidly, and unless the administration's initiative to protect honeybees somehow bears strong economic fruit, next year is highly problematic. If real wages aren't rising, and if aggregate hours worked aren't rising, the only thing we can count on to spur spending is SS & Disability. Those cash flows get sapped quite quickly by inflation.
Rail data for the first quarter showed a strong contraction, which we will get confirmed in the next GDP report. It's something like an annualized -1.8%. But rail data then picked up strongly, and now shows a much, much healthier picture. Both Mexican and Canadian data show the continuing difficulties for NA as a whole, so I am not expecting honeybee miracles.
Some might claim that trying to ban pesticides when food prices are this high might be self-defeating, but hey, give the dream a chance. ... more
