Tuesday, August 23, 2016

More Bad News

US new home sales at 9-year high for July... how much worse can it get...

Purchases of new U.S. homes unexpectedly jumped in July to the highest level in almost nine years, led by soaring demand in the nation’s south and adding to signs of persistent housing-market strength. 
Sales increased 12.4 percent to a 654,000 annualized pace, the fastest since October 2007, Commerce Department data showed Tuesday in Washington.


Tom Hickey said...

This is a big one if it holds. Housing has been the drag.

Bill McBride at Calculated Risk is the guy to follow, btw. He has been right about housing over the past several years and now thinks that remnants of the crisis are behind us.

We should be in the clear now unless a global crisis were to impact the US, too. But the ROW seems to have realized that austerity is creating too much social and political blowback to continue pushing.

There should be a spurt when people really feel that the Fed is about to raise rates, which will increase mortgage rates. Then some people will try to capture the low rate.

Michael Norman said...

But the deficit is too small!!

Tom Hickey said...

But the deficit is too small!!

Is the US approaching capacity?

Are there sign of price level rising continuously.

Is there actually full employment, or are they still lots of idle resources?

Is wage pressure building or are wage still way below historical trend?Is real investment increasing or financial investment (saving).

Has private debt shrunk to normal level after the debt binge?