Thursday, January 2, 2014

Monday's Pending Home Sales Report: More Negative Housing Data

On Monday the National Association of Realtors (NAR) released its Pending Home Sales Index report for November.  This is a pretty good proxy for the volume of activity in the housing market because it contains a data column that shows the actual number of signed contracts, which can tell a strikingly different story than the "seasonally adjusted annualized" number that makes headline news reports.  It does not revise for cancellations, which started to rise sharply during Q3 and Q4.

While November's data showed a slight increase vs. October using the adjusted annualized calculation that Wall St. likes to promote, it missed analyst expectations by a wide margin.  In addition, if you apply real analysis to the unadjusted data, you'll find a very bearish trend emerging.

I did an article for Seeking Alpha in which I detail a real analysis of the unadjusted data.  You can read it here:  More Bearish Data For Housing.

Just for the record, I do not take delight in being right about what is happening in our system.  But the public deserves to see the truth and not the manipulated, fraudulent reports issued by the Government, Wall Street and reported by the subservient financial media.  Unfortunately, a lot of people jumped into homes they could not really afford over the last 18 months because the Government, realtor industry and media brainwashed a lot of people into thinking that there was housing recovery underway.

After several trillion of Fed and Government direct stimulus into the housing market, is THIS really how you would define a recovery?

(source:, edits in red are mine)

If that's a recovery, what's the impending downturn going to look like?


  1. This chart pretty much confirms in black and white what has been predicted by the more astute analysts over the past several years. The precipitous plunge was much well established by 2007 when most prescient observers saw the handwriting on the wall followed by a permanently impaired systemic failure of the housing market bouncing along the bottom with zero possibility of recovery by 2009.

    Yet if you only focus on the trend from mid 2010 until the present which many of the government and industry cheerleaders concentrate on with the intent of misdirecting the public attention, new home sales have more than doubled. And this of course was only gratis of further fraudulent and lax credit evaluation practices on loan applications and of course the largesse of the FED liquidity injections into major financial institutions which subsequently entered the housing market en masse.

    I've noticed this fallacious and myopic perspective in sparring with the clowns on the comment board at Seeking Alpha. It's a foregone conclusion that the housing and MBS market is running on fumes, the persistent statistical manipulation of our ministry of truth, and worst of all the naive perceptions of a misinformed consumers and investors chasing a rapidly devaluing US$ into a financial abyss of no return.

    This collective mirage of economic recovery will be the last illusion to vanish with dire and even fatal consequences for many.

    1. Dave - Comment not related to this post, but an epiphany I just had today mulling over this great interview with Rickards (actually the Stanzyck one is even better - as it is more about phys).

      Question: If the Fed supposedly wants inflation - (Japan WANTS inflation, right?) why do they bias their inflation indices against inflation? i.e., CPI excludies energy & food, modern art, classic cars. I've never heard anyone ask or answer this question.

      Rickard says, if you want inflation, you let gold "run". Thus, his suggestion was that it was the Chinese who are manipulating the market. i.e, (how I read it from the Chinese perspective) "If you (the West) are going to be so stupid as to have these leveraged paper markets in gold, then, we'll just use all our $US cash reserves to push your pretend market(that you, the West, believe is real) down, and we'll walk away with all your physical gold. Thanks for you participation. China."


    2. Doug, I believe that any thinking person with means should be hording like the Chinese. Right now in China television commercials encourage the viewers to buy gold and hold it as security for their financial future. What do we get in the U.S. ? Idiotic articles on Yahoo discouraging the purchase of gold. This is going to end badly for a lot of people.

    3. Doug, parasitical banksters (and their enabling political lackeys) speak from both sides of their mouths. They love inflation, but it is a love which dare not speak its name and is tolerable only if it's the slow, steady kind which gradually and stealthily bleeds dry the host without that host ever knowing what is happening (how else to transfer wealth from the little people?). So while a little inflation may (in their minds) be a good thing, a thing which they proclaim to be constantly fighting against (yeah, right), a lot of inflation is not so good (high inflation would alarm and possibly awaken the host). Two face banksters, the last duty of whom is to speak the truth. Also, many government payout programs are geared with an inflation proviso in place. Under-report inflation, underpay the recipients. Damn, it's good to be a bankster.

  2. "Just for the record, I do not take delight in being right about what is happening in our system. But the public deserves to see the truth and not the manipulated, fraudulent reports issued by the Government, Wall Street and reported by the subservient financial media."

    Amen! But we will continue to be called "gloom-and-doom" by people who can't look at the charts from across all sectors of the economy and see a clear anaylsis of the grim situation we are in. They know absolutely nothing about history though they do watch the history channel once-in-a-while. Otherwise, the facts we present is too far over their heads.

  3. The Fed's Betrayal Of The Middle Class

    Certainly most of this is not a surprise to readers and no doubt many do question the Fed's loyalty but keep this point in mind - the Fed has done little if anything to generate economic growth over the last 5 years but they have done much to assist their owners in getting even bigger than they were before.

    That truth has led me to reconsider my views as it relates to the Fed and to the whole idea of privately owned central banks and the exorbitant privilege these banks are afforded by the fractional bank credit creation scheme. I have been led - reluctantly - to consider the possibility that the central bank/fractional reserve system is designed to enrich and empower an elite group at the top of the social strata and at the expense of the middle class.

    You see I have never - until recently - even considered the idea that the system was structured to work to the detriment of the middle class. I was educated to understand the benefits of the system and had no reason to consider any other possibility. That said, the Fed's actions since the recession make no sense to me if the idea is that the Fed is working to stimulate the economy and benefit the middle class as they claim. It does make sense to me if the goal of the Fed is to strengthen and consolidate power in the hands of a few banks at the top.

  4. Good stuff Dave. I can't believe the level of denial and hopium in the US media. The data does not indicate "recovery".

  5. OMG Joe Lieberman Joins Private Equity Firm

    Get this, Lieberman will be chairman (and the first member) of VPC's executive board, a new group aimed at advising Chicago-based Victory Park on a variety of operational issues facing its portfolio companies.

    What he is really doing is going total revolving door crony. Fortune writes:

    Expect that his focus will be on government and regulatory matters, although he will not directly lobby on behalf of Victory Park or its companies. Overall, Victory Park expects its executive board to have between six and eight members by year-end.

    "Many of our portfolio companies have to deal with the government, whether they're involved in aviation or oil and gas or food service, and we also have an SBIC fund" explains Victory Park co-founder Brendan Carroll, who once interned for Lieberman while getting his undergraduate degree at Georgetown. "He has much more experience in those areas than I or anyone else here could ever hope to have."

    Since leaving the Senate last year, Lieberman also has taken jobs as senior counsel at Kasowitz, Benson, Torres & Friedman LLP and as co-chair of the American Enterprise Institute's American Internationalism Project.

  6. Doesn't this chart look eerily similar?

    Employment to population ratio(aka The Real Unemployment rate):

  7. Jim Rickards rapid fire interview lays down a withering counter barrage at two of Bloomberg's most groomed stage parrots: US is in a depression, dollar will fall 80% like it did a few decades ago, POG to 7000+, elites moving to "hard assets" gold, railroads, etc, Fed clueless, bubble blower.

    1. I saw that and can't stand those idiots trying to ridicule him when they aren't a pimple on his ass! Check out the videos "when gold and silver go into hiding" and "the gold must move" by belangp on youtubeand the new fofoa article on dollarcollapse dot com. Excellent explanation of the TRUTH in the gold market!!

    2. 2014... Year of the Rains!

      Now see if you can spot the trend, and the dramatic change in 2013, in the following data. In 2010, the U.S. trade deficit was $498B, and foreign official holdings of Treasury securities that year grew by $456B. In 2011, the trade deficit was $560B, and foreign official holdings of Treasuries grew by $426B. In 2012, the trade deficit was $540B, and foreign official holdings of Treasuries grew by $386B. Of course the final numbers for 2013 aren't in yet, but here's what it looks like. The trade deficit in 2013 will probably be around $485B, and foreign official (that is, foreign central banks, i.e., "structural support") holdings of Treasuries grew by a mere $20B through October, $24B extrapolated through December. Here, I made you a handy chart to help you visualize it! :D

  8. Your blog is my primary source for accurate reporting on the state of the housing market. Housing's so-called "recovery" is about as real as the laughable "unemployment" numbers they try to feed us.

  9. Albert Cheng the head of World Gold Council in China discusses the Gold market in China and how Gold has became the foundation for wealth preservation and saving.

  10. Here’s something new I’ve been meaning to mention. The CME Group (owner-operator of the COMEX) lists a spot month position limit and monthly limit on actual deliveries of 7.5 million silver oz and 300,000 gold ounces by any one trader. Yet the CME is reporting that JPMorgan in its house account took delivery of more than double the amount of gold allowed in any one month. Since JPMorgan held the 6254 gold contracts from first delivery day forward, it also means that JPM was in violation of CME rules limiting spot month holdings in gold futures of 3000 contracts for the entire month. The violations in silver were less egregious but were violations nonetheless.

    I’m sure if pressed the CME could come up with some cockamamie excuse why JPMorgan was allowed to hold and take delivery of so many gold and silver contracts in one month, but the real reason is that JPMorgan is above all rules and law. The CFTC backed down on policing JPMorgan and it would be foolish to think the CME would restrict its most important client in any way. Far from a band of brothers, this is a brotherhood of criminals. Besides, rules are for the little people, not JPMorgan.

    1. I think they are untouchable because they are manipulating prices at the behest of the fed and government.

  11. Dave,

    Have you seen Chris Duane's documentary with respect to his take on real estate and housing? It is lengthy but well worth. You two share much in common. The doc is The greatest truth never told.

    1. I have not seen it - do you have a link?



      I watched it via XMBC hooked to the tv via laptop. It was found in the documentary section. It is over 4 hrs. Long and I was glued to it. I recall the housing bit was about 3 hrs in.
      Hope this link works.

    3. Thanks. Looks like it will work. Will check it out a bit later.

  12. General Motors (GM) has reported a fall in car sales in December in what was a disappointing month for US car makers.

    GM shares fell 2.4% after it reported a 6.3% fall in sales compared with December 2012.

    Ford and Chrysler both reported rising sales, but not the increases that industry analysts were expecting.

    Chrysler sold 161,000 cars and trucks in December, up 5.7% on the same period in 2012 and Ford reported a 1.8% rise in December sales.

    of course, they have to blame something so they blame "the weather".

  13. Another very important development is in the housing industry, where it seems nothing new was learned by the major collapse in 2008-09. Blackrock has been buying a large number of distressed single family homes. It has sold a $500 million IOU that is secured not by the homes but merely by the rents on 3,200 of the homes it has purchased. Really, it’s a bad joke, because to quote Yogi Berra, “It’s déjà vu all over again!” The $500 million is being split into tranches where you can own AAA rated paper that pays a mere 1.3% per year down to the “F” portion, which pays a pitifully low 3.8% as long as all the renters meet all their payments. Amazing!

  14. Into the Jaws of Death

    Published on Jan 3, 2014

    Inverted totalitarianism and frozen-dogmatic-perception have aligned to cause the perfect storm for the American Empire and people worldwide.

  15. FINRA Wants All of Your Information

    Many you may have already seen FINRA Notice 13-42, a request for comment on a proposed new system that would provide for automated and regular collection of data by FINRA on essentially all US brokerage accounts. The data would include customer, transaction, and security holdings information. FINRA’s stated purpose is to “advance its supervision of firms and their associated persons” in the name of customer protection.

    It strikes me as an unusual time for a regulatory body to be proposing such a massive increase in the collection of our customers account information and activity, and I’m concerned by the lack of discussion of this proposal anywhere outside the FINRA communication channels. My purpose in sending this email is to, at a minimum, generate some additional awareness both within and outside the broker-dealer community so that FINRA has an opportunity to hear from both industry and the public before the proposal is made part of the regulations.

    Among my concerns related to this proposal are:

    In contrast to the available inventory of homes, gold in western vaults and exchanges is oversubscribed and much sought after, even as record Fed forward carry agreements and interest rate swaps issue siren calls of debt swells and submerged shells.

  17. The Gold Must Flow!

    Published on Jan 2, 2014

    How gold is mobilized by the elite of the world, it's importance to world trade, and further evidence that it's withdrawing its bid for paper currency.

  18. Attorney For Goldman Sachs CEO Is Eric Holder's 'Best Friend'

    The crony connections just keep on coming over at Eric Holder’s Department of Justice.

    Last week, the Justice Department announced that it will not prosecute Goldman Sachs or any of its employees in a financial probe.

    Could that be because the attorney for Goldman Sachs CEO Lloyd Blankfein was none other than Attorney General Eric Holder’s “best friend” and former personal attorney, Reid Weingarten?

    Or because in 2008, Goldman Sachs employees donated $1,013,091 to Barack Obama?
    Or because Goldman Sachs is the former client of Eric Holder’s and Assistant Attorney General Lanny Breuer’s law firm, Covington & Burling?