I'm not a Rand Paul fan, but he made a comment yesterday that makes complete sense: (to paraphrase) If Obama likes Obamacare so much, why doesn't he voluntarily enroll in it? To that I'll add: Everyone in Congress is exempt from Obamacare as well. Any Congressman who voted for it should have to enroll in it. I'll also propose this: how about everyone in Congress doesn't get paid until the Government ratifies an official budget - something that hasn't been done for several years now - and come to an agreement on the debt ceiling.Yesterday's new home sales report for August and today's pending home sales report for August further confirms that the "housing recovery," which I prefer to call a "dead cat bounce," has run its course. While new home sales for August were reported as a healthy "gain" over July in the headlines, when you analyze the details the data shows otherwise. In fact, July's plunge in new home sales was revised even lower.
I review the August data - along with a quick overview of KB Homes quarterly earnings report - which further confirms my thesis in this article published by Seeking Alpha: Lights Out For The Housing Recovery.
In addition, the National Association of Realtors released its Pending Homes Sales Index for August. This index supposedly tracks future home sales based on contract signings. It was reported to be down 1.6% for August. This is not a good sign because typically August is the second or third biggest month seasonally for home sales. The fact that contract signings dropped like this in August is a very bad sign.
Speaking of "signs," I'd love to know how the NAR calculates its inventory of homes report. I say this because I've noticed over the past 6-8 weeks that there has been a literal avalanche of "for sale" and "coming soon" signs posted all around the metro Denver area. The NAR must "seasonally adjust" the listings that get reported to it.
I travel pretty much along the same routes from central Denver to south Jefferson County every week and every few days I notice more and more "for sale" signs posted. To me it's a sign of desperation when a homeowner or a home-flipper puts a home on the market right on the cusp of the slowest seasonal selling period of the year. My observations lead me to believe that the NAR reported inventory numbers are substantially off the mark. Perhaps intentionally to create the illusion of low inventory. Whatever the case may be, there's a lot of homes in Denver that are on the market that were not on the market in June and my observation stretches across all neighborhoods in terms of demographics.
I'm sure the Fed knows everything I've just stated and I'm sure that the probable re-collapse in the housing market played a tertiary consideration in their decision to not taper. Of course, big bank solvency and Federal Government solvency are the primary and secondary considerations, with most of the emphasis place on the "primary" factor.