The Golden Truth: Pending Homes Sale Report: The Housing Market Lurches Lower

Thursday, August 29, 2013

Pending Homes Sale Report: The Housing Market Lurches Lower

Before I post my latest work on the housing market, I wanted to quickly follow up on my post about Syria from the other day. The AP is now reporting that both U.S. and U.K. intelligence officials are back-pedalling on their original assessment that the chemical attack in Syria was done by the Assad Government:

The intelligence linking Syrian President Bashar Assad or his inner circle to an alleged chemical weapons attack is no "slam dunk," with questions remaining about who actually controls some of Syria's chemical weapons stores and doubts about whether Assad himself ordered the strike, U.S. intelligence officials say.

Here's the link to entire article: LINK

Funny how Obama and Biden were adamant that Assad launched the chemical attack. To reiterate, this situation reminds me exactly of Colin Powell giving his speech on Iraq's weapons of mass destruction and all the proof the U.S. had of those. Turns out Powell was lying to entire the world. I don't know why he was never prosecuted for war crimes. It's just amazing what the American public is letting the Government get away with...

Yesterday the National Association of Realtor's Pending Home Sales Index was released. On the surface it was bad. When you dig through the whole report, it it further confirms my thesis that the housing market is re-entering its bear market downtrend:

The truth of the matter underlying the "dead cat" bounce in the housing market over the past 18 months is that since 2008 the Fed and the Obama Government spent a couple trillion dollars trying to revive the housing market. All they really accomplished was the transfer of a massive number of distressed homes from the big mortgage banks [JPMorgan (JPM), Wells Fargo (WFC) and Bank Of America (BAC)], and from Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB), to some large private equity funds looking to speculate on housing and to individual buyers who got sucked into the momentum that was generated. The stimulus has now lost its effect and the housing market is headed back to an eventual lower bottom.

Here's the link to the entire article: The Housing Market Lurches Lower

I'm still trying to figure out how the remaining housing market bulls think that bounce over the last 18 months can continue when more and more people are being down-graded from full-time jobs to part-time jobs, real disposable income is now declining, interest rates are in an uptrend and the economy is in decline. I guess for some people hope will always hold stronger than the facts which support the fundamentals...

8 comments:

Michael JacksonThursday, 29 August, 2013
Sales of New U.S. Homes Fell More Than Forecast in July'

Purchases of new U.S. homes plunged 13.4 percent in July, the most in more than three years, raising concern higher mortgage rates will slow the real-estate rebound.

http://www.bloomberg.com/news/2013-08-23/sales-of-new-homes-in-u-s-plunged-more-than-forecast-in-july.html

This muni-bond selloff looks like Lehman all over again.

“The near term movement of the market will potentially, like those in 2008 did, test the courage and perseverance of even the most patient investors. In fact, this market movement has already begun. During the middle of 2013 – from May 1 through June 24th – municipal benchmark yields experienced a ‘Lehman-like’ move when they rocketed up 114 basis points, the fastest increase since the 2008 Lehman Brothers bankruptcy filing.”

http://blogs.marketwatch.com/thetell/2013/08/22/this-muni-bond-selloff-looks-like-lehman-all-over-again-janney/
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AnonymousThursday, 29 August, 2013
Dave, do you think those overseas investors will change your view? I know a lot of Chinese buyers are gobbling up houses in the US.
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Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.