New home sales: Biggest drop ever Weak December sales caps 2007's record slide, with prices for the month off sharply from a year earlier.
NEW YORK (CNNMoney.com) -- New home sales posted the biggest drop on record in 2007, according to the government's latest look at the battered housing market, as a year that saw a meltdown in the mortgage market and a drop in home values ended with yet more signs of weakness.
December sales came in at an annual rate of 604,000, the Census Bureau report showed, down from 634,000 in November, which was also revised lower.
The reading was well below the consensus forecast of 645,000, according to economists surveyed by Briefing.com.
The weak December sales left full-year new home sales at 774,000, down 26 percent from the 1.05 million sales in 2006. That was the biggest drop since the government started tracking new home sales in 1963, surpassing the 23 percent decline posted in 1980.
So not only do you troll me yet again but you post something already posted.
So not only do you troll me yet again but you post something already posted.
New home sales: Biggest drop ever Weak December sales caps 2007's record slide, with prices for the month off sharply from a year earlier.
updated 1 hour, 44 minutes ago
WASHINGTON - New home sales plunged in 2007 by the largest amount on record while home prices tumbled sharply in December. Analysts forecast more trouble in 2008 as housing tries to emerge from its worst slump in more than two decades.
The Commerce Department reported Monday that sales of new homes dropped by 26.4 percent last year to 774,000. That marked the biggest decline on record, surpassing the old mark of a 23.1 percent plunge in 1980.
The government reported that the median price of a new home barely budged last year, edging up a slight 0.2 percent to $246,900, the poorest showing since prices fell by 2.4 percent during the 1991 housing downturn. Story continues below ↓advertisement
And the slump in sales and prices appeared to be worsening at year’s end. December sales fell by 4.7 percent, a bigger-than-expected drop, while the median price of a home fell by 10.4 percent last month, when compared to December 2006, the biggest 12-month decline in 37 years.
“It looks like the floor fell out of the housing market in December,” said Mark Zandi, chief economist at Moody’s Economy.com. He said the current slump is already on par with the deep housing downturn of the 1980s and could end up being the worst in the post-World War II period.
The data on new homes followed earlier reports that sales of existing homes dropped 13 percent last year, the biggest decline since 1982, while construction of new homes and apartments fell by 24.8 percent, the largest drop since 1980.
Zandi predicted that sales of new and existing homes will likely hit bottom this spring and that construction will level off by this summer. But he said prices were likely to keep falling for the entire year as weak demand forces sellers to cut asking prices even further to move homes.
Housing is slumping now after a five-year boom. Demand for both new and existing homes hit all-time highs for five straight years, ending in 2005, the peak of the boom. New home sales fell by 18.1 percent in 2006. The sales level last month is now down by 56.5 percent from the monthly peak hit in July 2005.
The prolonged slump in housing is raising concerns that the weakness could be severe enough to push the country into a full-blown recession. In an effort to guard against that threat, the Federal Reserve cut a key interest rate last week by the largest amount in more than two decades with a further rate cut expected on Wednesday when the Fed completes a two-day meeting.
[This message has been edited by 84Bill (edited 01-28-2008).]
I heard on the radio this morning that over 2 million ARM's are a due to reset this year and the next. Knowing that, it just amazes me that banks aren't being more aggressive about refinance these people into fixed rate mortgages. Strictly from a business standpoint, it's in their best interrest for these people to keep their homes. A bank doesn't want to own a foreclosed property, especially in the current market where home sales are at record lows.
Originally posted by ditch: I heard on the radio this morning that over 2 million ARM's are a due to reset this year and the next. Knowing that, it just amazes me that banks aren't being more aggressive about refinance these people into fixed rate mortgages. Strictly from a business standpoint, it's in their best interrest for these people to keep their homes. A bank doesn't want to own a foreclosed property, especially in the current market where home sales are at record lows.
Hmm...does this just mean that a buyers market is upon us ? Home sales set to shoot through the roof ? My, I love the way the economy works...if I can work it.
Hmm...does this just mean that a buyers market is upon us ?
IMO, the answer to that is a 100% yes. I'm keeping a close eye on this myself because I plan on buying another house when prices hit rock bottom.
In general, the worse things get on the foreclosure front, the lower prices go, and the better it is for me if I want to do some house flipping in the future. Even with that in mind, I still don't want to see things continue to get worse.
[This message has been edited by ditch (edited 01-29-2008).]
Hmm...does this just mean that a buyers market is upon us ? Home sales set to shoot through the roof ? My, I love the way the economy works...if I can work it.
Oh yes it will be a buyers market. Prices are down and may keep going down. Stock is high and interest rates are down. Not so great for sellers though. How ever if you are selling and buying its still good.
Yes, it'sa's an interesting/unique housing market right now. I owe about $110,000 on my house and a personal loan. My house is valued at $235,000 because of the housing market values 2-3 years ago. I'll list at $185,000. I'll get offered $165,000-$175,000 and I'll take it, walking away with about $50,000 in my pocket. My neighbor, who bought and owes $140,000 on his house that is valued less than mine, can't take less than $150,000 on his house without taking it in the shorts for a loss.
I bought my house at a good value and I'll sell my house at a realistic value that some buyer will feel that he got a deal on.
My neighbor is left sucking hind tit. Quite a unique market place and a buyers market.
Originally posted by aceman: Quite a unique market place and a buyers market.
Why is this thread 45 pages long ? Are we talking about a buyers economy or a sellers economy ? The economy is in your back pocket. That is why the government is thinking by putting money there (tax rebate) that they are helping. If that were so then it would mean the more money they gave us the better the economy, . I think I will invest my money inside my mattress, . The economy is based on production, not spending.
Originally posted by cliffw: The economy is based on production, not spending.
We dont really produce anything here in the U.S. Some windows, maybe some car parts and a ton of junk food but no real industrial strength is left, just a hodgepodge of odd and ends.. Although we do have the mighty dollar in our corner.
UBS expects $14 billion housing hit Swiss bank says bad bets on subprime mortgages will result in record fourth-quarter loss of $11.5 billion.
ZURICH, Switzerland (AP) -- UBS AG said Wednesday it expects a record loss for the fourth quarter, largely as a result of $14 billion of writedowns on bad investments in U.S. subprime mortgages.
Switzerland's largest bank said it expects a fourth-quarter loss of $11.45 billion. The full-year net loss - the first in its 10-year history - will amount to $4.03 billion.
Home ownership in record plunge. Fourth quarter saw biggest one-year drop in since tracking began in 1965 - as mortgage problems and rising foreclosures take their toll.
NEW YORK (CNNMoney.com) -- The housing and mortgage meltdown caused the biggest one-year drop in the rate of homeownership on record, according to government figures released Tuesday.
The decline, while expected, is yet another indication of the housing market's sudden and dramatic turn.
The Census Bureau report showed that home owners accounted for 67.8% of occupied homes in the fourth quarter, down 1.1 points from a year earlier. It's the largest year-over-year drop recorded in the report.
"It's an incredible story," said Dean Baker, co-director of the Center for Economic and Policy Research. "We're back to where we were in 2002, which is before the subprime nuttiness and run-up in prices. And it's not clear how much farther we're going to fall."
The ownership rate was well below the 68.2% ownership rate in the third quarter of 2007. Homeownership rates, which have been tracked since 1965, hit a record high of 69.2% in the second and fourth quarters of 2004.
Wal-Mart sheds apparel ambitions Wal-Mart (WMT) is getting back to basics in its $30 billion clothing business. The nation’s biggest retailer is planning a shakeup of its apparel unit and the firing of “a significant number of workers” at its Bentonville, Ark., headquarters, The New York Times reports. Wal-Mart will move some 30 merchandising jobs to New York as it seeks to narrow its focus on basic clothes its customer base wants. Wal-Mart has tried in recent years to pull in more upscale consumers by offering more stylish clothing, but that effort met with limited success. The company’s Metro7 jeans, for instance, sold well in some urban stores but were rejected by Wal-Mart shoppers in most of the country. Now, the executive who led the upscale clothing push is gone, and Wal-Mart is looking to sell more brightly colored T-shirts, the Times reports. The new direction, as simple as it seems, certainly sounds like a better fit.
Yeah yeah "growth" is good we know so spare us all the diatribe on how less than expected growth is somehow good when it isnt. The "growth" should be off the charts for December, it wasn't, it was a dismal display of a weakening economy.
Economy much weaker than expected Gross domestic product slowed to a 0.6% growth rate in the fourth quarter, raising both recession fears and hope for another deep Fed cut.
NEW YORK (CNNMoney.com) -- The economy grew at a much slower pace in the last three months of the year, according to a government report Wednesday that came in well below Wall Street expectations.
The report raised fears of a recession and hopes for another significant interest rate cut by the Federal Reserve.
The gross domestic product, the broadest measure of the nation's economic activity, grew at an annual rate of 0.6%, adjusted for inflation, in the fourth quarter, according to the Commerce Department, down from 4.9% in the final reading of growth in the third quarter. Economists surveyed by Briefing.com had forecast GDP would slow to a 1.2%.
The report comes amid rising concern that the U.S. economy is falling into a recession, with some economists arguing the downturn started in the final month of 2007.
It also comes as the Fed concludes a two-day meeting to consider whether or not to cut interest rates once again in order to spur the economy and ward off a recession. The central bank has already lowered rates by 1.75 percentage points since September, including an emergency 0.75 percentage point cut, also known as a 75 basis point cut, a week ago.
Investors are betting that the Fed announces at least another quarter percentage point cut, or 25 basis points, when it announces its decision at 2:15 p.m. ET, with those buying fed funds futures on the Chicago Board of Trade were pricing in a 70% chance of a half-point, or 50 basis point cut, ahead of the GDP report.
But while the weakness in the report suggested that the Fed might move aggressively to cut rates, the inflation readings in the report could be a concern for the central bank. The so-called price deflator, which measures prices overall, rose at a 2.6% annual rate, up from only a 1% rise in the third quarter but in line with forecasts.
Perhaps of greater concern is that the so-called core PCE deflator - a more closely watched inflation reading that measures prices that individuals pay excluding volatile food and energy prices - rose 2.7%, up from a 2.0% reading in the third quarter and nearly double the 1.4% rise in the second quarter.
The Fed is generally seen as wanting to see that reading rise between 1% and 2%, meaning the latest reading is far from its so-called comfort zone.
Originally posted by 84Bill: Yeah yeah "growth" is good we know so spare us all the diatribe on how less than expected growth is somehow good when it isnt. The "growth" should be off the charts for December, it wasn't, it was a dismal display of a weakening economy.
Billy, every thing which goes up must come down. We have good times we have bad times. Both exist to recognize the other. People gain weight and then lose weight. Tires go flat then you fix them. People get arrested and then straighten up their act. We get good grades in school and bad ones. What is the fixation on doom and gloom, , ? The economy is just fine. In fact, maybe we should define the economy we are speaking of. The economy as they see it or the economy in one's back pocket ? The back pocket is up to us. Life is about adapting, it is about being smart. Pssh the housing market. I am thinking about buying...and selling (most likely keeping). Pssh the gas prices, it takes money to make money. Pssh the food prices. Gas and food prices, adjusted for the cost of living are not too far out of line. As less people can afford them, prices will come down. If they want to sell any, . Which economy is in dire straights ? The job income economy? This is nothing new historically. We americans have just become used to having instead of getting.
Originally posted by cliffw: What is the fixation on doom and gloom, , ?
Why do you care?
quote
The economy is just fine.
So you say but the facts dont support it. Have any facts to support it?
quote
Life is about adapting, it is about being smart. Pssh the housing market. I am thinking about buying...and selling (most likely keeping). Pssh the gas prices, it takes money to make money. Pssh the food prices. Gas and food prices, adjusted for the cost of living are not too far out of line. As less people can afford them, prices will come down. If they want to sell any, .
Doesnt mean jackshit if there is no money circulating "persay" or that the money that is in circulatiuon is so diluted or is that deluded? that it's near worthless.
quote
Which economy is in dire straights ?
Pick one, they are all in the tank right now. EU, China, Canada. Pick one.
quote
The job income economy? This is nothing new historically. We americans have just become used to having instead of getting.
ALL the leading indicators are down. Like some on this forum the reports try to put a positive spin on a declining economy. However, the reports all show an across the board drop or "decline" in economic expectations. I don't expect you to comprehend or understand what that means in the big world picture you "live in."
After a feeble rise in November, orders for durable goods -- products designed to last at least three years -- rose by 5.2% last month to a seasonally adjusted $226.6 billion, the Commerce Department said Tuesday. Most of the gain came from a big jump in demand for commercial aircraft. But a key gauge of business spending -- orders for nondefense capital goods excluding sometimes-volatile orders of aircraft -- also surged in December, rising 4.4%,
European shares scored their third rise in six sessions on Tuesday, lifted by gains for financial and mining equities a day before a key decision on U.S. interest rates by the Federal Reserve.
The pan-European Dow Jones Stoxx 600 index closed with gains of 1.6% to stand at 323.93, behind strong gains for miners and banks.
Of national indexes, the French CAC-40 index finished up 1.9% to 4,941.45, the German DAX 30 index ended the day up 1.1% to 6,892.96 and the U.K.'s FTSE 100 index advanced 1.7% to 5,885.20.
HARARE, Zimbabwe, April 25 — How bad is inflation in Zimbabwe? Well, consider this: at a supermarket near the center of this tatterdemalion capital, toilet paper costs $417.
No, not per roll. Four hundred seventeen Zimbabwean dollars is the value of a single two-ply sheet. A roll costs $145,750 — in American currency, about 69 cents.
The price of toilet paper, like everything else here, soars almost daily, spawning jokes about an impending better use for Zimbabwe's $500 bill, now the smallest in circulation.
Yes that is a ten million dollar bill.
Ecomnomic indicators.
ADVANCE MONTHLY SALES FOR RETAIL TRADE AND FOOD SERVICES Lower then the month before but higher then last year.
quote
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for December, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $382.9 billion, a decrease of 0.4 percent (±0.7%)* from the previous month, but 4.1 percent (±0.7%) above December 2006. Total sales for the 12 months of 2007 were up 4.2 percent (±0.4%) from 2006. Total sales for the October through December 2007 period were up 4.9 percent (±0.5%) from the same period a year ago. The October to November 2007 percent change was revised from +1.2 percent (±0.7%) to +1.0 percent (±0.2%).
Retail trade sales were down 0.4 percent (±0.7%)* from November 2007, but were 4.3 percent (±0.8%) above last year. Gasoline station sales were up 18.5 percent (±2.8%) from December 2006 and sales of nonstore retailers were up 12.1 percent (±1.8%) from last December.
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 0.6 percent in the fourth quarter of 2007, according to advance estimates released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 4.9 percent.
The Bureau emphasized that the fourth-quarter "advance" estimates are based on source data that are incomplete or subject to further revision by the source agency (see the box on page 3). The fourth- quarter "preliminary" estimates, based on more comprehensive data, will be released on February 28, 2008.
Thats still up, right?
Most key indicators aren't out yet yet since there is a lag in quarterly reports which is how most of them come out.
Originally posted by unnamed: Deluded incoherent shell shocked misinformed ramblings.
Must be why the Fed and the federal government are trying desperately to prop things up and put a pretty face on a very ugly problem huh? It's just all part of the way a strong economy works, a circus act of congress. Just a prop here, a mirror there, some smoke, sleight of hand and more beguilement than Sylvester the Jester. Very entertaining but your contention has more holes in it than government approved USDA grade A swiss.
Do you know how to use a calculator? Whats the net percentage loss of the GDP from the expected 1.2% I'll give ya a hint. Actual "growth" .6% Minus the projected growth 1.2% which was adjusted down from 4.9%.
Thats a downward slip of how much.
The Fed's stagflation fear. IT'S ALL A LIE!!!!! The economy grew at weaker pace than expected in the fourth quarter but inflation was higher too.
NEW YORK (CNNMoney.com) -- Uh-oh. The Federal Reserve's decision at 2:15 p.m. just got a little tougher.
Fourth-quarter growth in gross domestic product was lower than expected, rising only 0.6%, compared to forecasts of 1.2% growth and way below the 4.9% growth in the third quarter.
That certainly lends credence to the arguments that the economy is nearing - if not already in - a recession and that the Fed should slash interest rates again this afternoon.
Another number in the GDP report should give the central bank pause, however.
The core personal consumption expenditure (PCE) deflator, an admittedly wonky sounding piece of econojargon that is actually a very important indicator of inflation, rose 2.7% on an annualized basis. That's up from 2% in the third quarter and was higher than the 2.5% that economists were expecting.
As I wrote in Monday's Morning Buzz, inflation is still something the Fed has to be concerned with. The latest number proves that. Still, this probably won't be enough to keep the Fed from cutting rates by another half-of-a-percentage point.
But the threat of stagflation, a period of both economic sluggishness and rising price pressures, has to weigh on the Fed when it puts together its carefully constructed statement.
The central bank needs to continue to talk tough on inflation and may need to signal to the market that after today's expected half-point cut - which would leave the federal funds rate at a pretty accommodating 3 percent - that it's time to hold steady for awhile.
As bad as the subprime mortgage mess has been, letting prices for many consumer goods run out of control by further weakening the dollar with aggressive rate cuts could have an even more damaging effect on the economy.
In fact, inflation could be contributing to the current slowdown.
"Domestic demand readings were weaker than we expected, not holding up well in the face of the inflation surge, driven mostly by energy costs," wrote Citigroup analyst Steven Wieting in a report this morning.
And no less an authority than former Federal Reserve chief Alan Greenspan warned about the possibility of stagflation as recently as last month. And with food and energy prices continuing to rise, hopefully current Fed Chairman Ben Bernanke and the rest of the Fed will take Greenspan's words to heart.
[This message has been edited by 84Bill (edited 01-30-2008).]
.6% growth 1.2% growth Is still growth. less growth then before is still growth
And don't troll me bill. If you can't act like an adult don't post. You constant changing of my name in quotes is trolling. Cliff told you to stop. So why don't you? I know you can't because that would mean you can't start **** and then play the victim. I thought this brought you emotional stress? Either it wasn't that bad or you were lying again. If it were true and it was so bad you wouldn't keep starting crap with people at every opportunity. This is the second time in this thread you've started trolling me. And try to say it wasn't a troll everyone knows it is. Now stop harassing me.
And I like your strawman argument that the numbers are smoke and mirrors. It only goes to show you really don't have a clue and will dance and dodge and strawman.
Yup, even growth that is not great is still growth none the less. Pretty basic stuff right there.
I'll worry when there is one quarter of negative numbers. When there is two quarters I'll really worry. Although not so much if those negative numbers are less then -2%. And recessions don't last that long. If we have one it will be like the stocks taking a correction. Prices will come down. It won't be the end of the world just like it wasn't in 91 or the 80s.
Are you ever going to be able to man up to anything Phranc?
Your right bill its all my fault you had to start trolling me for no reason. I left you alone when Cliff told me to. But you couldn't stop. And thats my fault?
I'll worry when there is one quarter of negative numbers. When there is two quarters I'll really worry. Although not so much if those negative numbers are less then -2%. And recessions don't last that long. If we have one it will be like the stocks taking a correction. Prices will come down. It won't be the end of the world just like it wasn't in 91 or the 80s.
Now that is a very realistic view to have.
I will add that the 91 recession was a mere blip and was blown way way out of proportion by the media because of the election cycle. Some things are obviously not doing so well this time and in my opinion are once again being hyped for the election year, but overall things are still pretty good so far.
I heard on the radio yesterday that there is a federal investigation going on of some 13 companies involved in a long list of felonies involving the home loan industries. This should be interesting.
And yes, I think Bill sent the thread here,,,,,,,,,,,,,, this time.
[This message has been edited by Red88FF (edited 01-30-2008).]
. I think I will invest my money inside my mattress, 
.
Yup, even growth that is not great is still growth none the less. Pretty basic stuff right there. 
