As Goes Housing So Goes Stimulus
CIGA Eric

The end of the Federal homebuyer tax credit in April slowed down Lennar Corp.’s May results and hurt fiscal second-quarter revenue, but the homebuilder reversed a year-ago loss as it cut costs.

The pressure to resume programs that support housing intensify as market trends deteriorate.

New home sales drop to lowest level since the inception of the series.

New Home Sales And Change YOY, SA:
^[1]

The price of lumber has fallen below the October 2009 lows. Connected money has been fading the weakness but not enough to generate a statistically significant, bullish setup.

Lumber Futures Continuous Contract and the Commercial Traders COT Futures and Options Stochastic Weighted Average of Net Long As A % of Open Interest:
^[2]

The consolidation pattern within the downtrend has been broken to the downside in the Housing Index.

Housing Index:
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Source: finance.yahoo.com ^[4]

More… ^[5]

Deutsche Bank: U.S. Financial Conditions Just Collapsed Back To Crisis Levels
CIGA Eric

Back towards to Crisis levels. How about worse than recent crisis levels in this, The Ski Jump Virtual Recovery.

Jim,

Credit conditions or liquidity are once again tightening (spreads widening) as the economy is losing momentum from waning stimulus. Watch out. This is a precursor for trouble, which usually means more stimulus.

Commercial Paper 90 days less Treasury Bill 90 days:
^[6]

Deutsche Bank has a new and improved index of U.S. financial conditions, and this index just slumped back towards the lows of our recent crisis.

Source: businessinsider.com ^[7]

More… ^[8]