Existing U.S. Home Sales Fall for Third Month
CIGA Eric

Existing sales fell but other headlines reassure us that all is well as long as expectations are exceeded – Stocks climb after home sales top expectations ^[1]. Headline spin can be a very tough nut to crack for the average investor.

Sales of existing U.S. homes fell in February for a third month, indicating a lack of jobs is hindering government efforts to revive demand.

The extension and expansion of a federal tax credit that helped stabilize housing in 2009 has yet to spark sales this year as hiring hasn’t materialized. Home Depot Inc. is among companies cutting prices to stimulate demand as the world’s largest economy recovers from the worst recession since the 1930s.

Extent and pretend is the foundation of stimulus. Extend the housing credits and pretend the benefits outweigh the costs. The reason why pretend and extend didn’t work in the 30′s and doesn’t work today is that worst recession since 1930 is not a recession. Today’s recession is part of a series of recession and liquidity induced recoveries, jobless recoveries, that the media either cannot, through ignorance, or more likely will not, as part of pretend and extend, recognize this fact until will after the fact.

It’s up to you. People tend to see what they believe, but money demands objectivity.

Purchases dropped 0.6 percent to a 5.02 million annual rate, the lowest level in eight months and in line with the median forecast of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed today in Washington. The median price decreased 1.8 percent from February 2009.

Falling sales and lower prices generates a falling real trend ^[2].

Source: bloomberg.com ^[3]

More… ^[4]

Stocks climb after home sales top expectations
CIGA Eric

Stocks punched higher Tuesday to extend their streak of gains after sales of existing homes fell less than expected.

The stock rally rolls on, but do not be deceived by the reasons why. Housing starts, while bouncing from depressed levels in 2009, are beginning to roll over. Also, the months supply of new one-family houses for sale, or the ratio of houses for sale to houses sold is rising again. Headlines suggesting unexpected strength mean little in the face of these trends. In other words, something other than better than expected home sales is pushing the market higher. The rally in equities was setup long ago by leverage money ^[5].

Housing Starts And Change YOY:
^[6]

Months Supply And Change YOY:
^[7]

Source: finance.yahoo.com ^[8]

More… ^[9]

Greek Crisis May Provoke Fed-ECB Split as Euro Slides
CIGA Eric

European Central Bank President Jean-Claude Trichet’s campaign for governments to learn the lessons of the Greek fiscal crisis may provoke a transatlantic policy split that forces the euro back toward its lows of 2006.

As investors push Greece, Spain, Portugal and Ireland to deliver on plans to cut budget deficits, the withdrawal of stimulus raises the risk of double-dip recession and even deflation in all or parts of the 16-nation euro area. The possibility of slower expansion is prompting economists from Deutsche Bank AG to HSBC Holdings Plc to predict Trichet’s ECB will be slower than they previously anticipated in raising its key interest rate from a record low of 1 percent.

Of course, well all know that Europe is the epicenter of the world’s economic stresses.

AP analysis: Average county was stressed in Jan. ^[10]

Worsening economic conditions caused the nation to reach a bleak milestone in January: For the first time since The Associated Press began analyzing conditions in more than 3,100 U.S. counties nearly a year ago, the average county was found to be economically stressed.

Driving the pain was a deterioration in states that earlier had weathered the Great Recession better than the nation as a whole. These states endured the sharpest gains in unemployment for the past three months due to job losses in such industries as energy and construction. The states include West Virginia, Idaho, Mississippi, Montana and Wisconsin.

Yet, it’s all about Europe. Nothing to see here in the U.S. Looks like someone talking their short Euro book. Short Euro pushes up the U.S. Dollar Index which is 57% the Euro. This opens the dollar to COMEX gang.

Source: bloomberg.com ^[11]

More… ^[12]