Global Market Commentary, Analysis and Investments
Indeed, even with the government's report declaring the cleanup 75% complete, the Gulf of Mexico recovery will be slow and laborious. And expensive…
As of a few hours ago, there's enough fresh cement in the Macondo oil well to hold down the “mud� that's keeping the oil beneath the seafloor. It's not the final step in plugging the hole, but it's a big one. Now the tallying begins.
[Read more...]The markets gave no clear sign of their intentions yesterday. The Dow fell 30 points. Gold rose $8.
And this morning, stock markets in Asia dropped. Earnings are up, just as they are in America. But earnings have a “last waltz� sound to them. AP reports:
New figures from Japan offered a sobering reminder that the world's No. 2 economy remains fragile: The jobless rate rose, deflation deepened, and factories made fewer cars and mobile phones.
[Read more...]The news that drove the markets yesterday was no big surprise for the desk. Homebuilder confidence here in the US dropped to the lowest level since April 2009 as the homebuyer credits expired. Today we will get additional data on the housing market which is expected to show US housing starts continue to fall while foreclosures climb. While prices steadied over the past couple of months there is still a backlog of homes facing foreclosure which will equate to a very slow recovery for the housing markets. And in the US, as the housing goes so does the economy; so the data is not a good sign for our nascent recovery.
[Read more...]In April 2007, we issued a report headlined The Second Wave of the Housing Tsunami: 2007-2011 in which we suggested commercial real estate was likely to be the second shoe to drop in what was already an unnerving collapse in the residential housing market.
Some of the more speculative plays we issued in the report panned out well for those inclined to follow them. A Countrywide put closed at a 417% gain. Another put on the “financial select� SPDR closed up 172%. And a third put on Lowe's home improvement closed at 93%.
[Read more...]You say yes, I say no
You say stop and I say go, go, go
Oh, no
– The Beatles
We keep saying the same thing here at The Daily Reckoning. Not because we lack imagination… It's because things are still the same.
“Outlook for home prices grows darker,� says The Wall Street Journal.
[Read more...]What happened to the recovery? This report from AP:
WASHINGTON (AP) – Sales of previously occupied homes dipped 2.2 percent in May, signaling that a boost from home-buying tax credits is fading sooner than expected.
Last month's sales fell from the previous month to a seasonally adjusted annual rate of 5.66 million, the National Association of Realtors said Tuesday. Analysts who had expected sales to rise expressed concern that the real estate market could tumble once the benefit of the federal incentives is gone entirely, starting next month.
[Read more...]“You can get wood. You can get brick. You can get stucco. Boy, can you get stucco.� – Groucho Marx
In the Florida land boom of the '20s, promoter Carl G. Fisher hired a huge, lighted billboard in Times Square in New York. It advertised that “It's June in Miami,� a claim that was fraudulent 11/12ths of the year. In June, it was just too bad.
[Read more...]A few other markers of continued troubles in the housing market for you:
First, Zillow reports 23% of homeowners with mortgages were underwater during the first quarter. Nearly one-third of homes sold in March sold for less than the sellers paid
Second:
Signs of the Times
We came to see the real America. This week, we had a good look around.
Fellow Reckoners will recall that we are on a vagabond's odyssey, traversing the Great Empire in search of a Greater Correction. We began our tour in California, the real estate bubble of the west. It will conclude, if all goes to our back-of-the-envelope plan, in Florida, the real estate bubble of the east. In between – Arizona, Nevada, New Mexico, Texas… We keep our ear to the ground, listening for aftershocks.
[Read more...]