Wednesday, July 29, 2009
The WSJ came out with an article the next day with a fuller explanation of the good and bad news regarding Monday's new home sales 'rise'.
Compared to the blogosphere the WSJ was 24 hours too late. I bring this up because 24 hours to the markets is a looong time. Calculated Risk immediately presented the complete picture, good and bad news alike and continues to be an excellent source for the housing market.
While some blogs are complete drivel others are faster and superior to the popular media. Those superior blogs are one reason for the slow decline in the print and television media.
Monday, July 27, 2009
New home sales were up 11% or down 21.3% Excuse me? Is that really good news or really bad news?
Yahoo News had this to say:
New home sales in June posted the fastest increase in more than eight years as buyers took advantage of bargain prices, low interest rates and a federal tax credit for first-time homeowners
What was omitted by Yahoo: The home sales increase was on a month to month basis, and NOT on a year over year basis as it should be presented. Month to month (May 2009 versus June 2009) sales were up 11%. Year over year (June 2008 versus June 2009) sales were down 21.3% Like many other economic events, home sales show a strong seasonal tendency and to only tout monthly changes without showing year over year data does not provide a complete picture to the reader.
Calculated Risk provides an excellent blog entry and graph showing the sales during each month as well as year to year.
Fundmymutualfund has a slightly snarkier commentary:
I'm feeling faint.... the news is so overwhelmingly good. Even though sales surge EVERY year in the spring let me shoot this bunny out of a cannon in celebration because....
Sales have risen for three straight months. Now keep in mind this is with taxpayer handouts of $8000 to first time homebuyers, along with unnatural mortgage rates created at the expense of savers in this country via Uncle Ben's actions. More on this later. So the important question in a SEASONAL number is the year over year % change. Sales of new homes were down 21% versus June 2008.
At least the Wall Street Journal had the sense to put in the year over year numbers, but in the body of the article and not in the title?
What is going to happen to all the good news reporting in the fall when it is very likely new home sales will fall on a month to month as well as yearly basis?
Disclosure: Short some housing stocks in personal and aggressive client accounts
Friday, July 24, 2009
The Organization of Petroleum Exporting Countries is bracing for a sharp drop inConsidering the current high correlation between oil and stock prices it will be curious to see if/when oil prices drop how much of an affect it will have on stock prices.
crude prices in coming weeks, as huge reserves of oil-based fuels continue to
pile up and the space to store them runs out.
Wednesday, July 22, 2009
Oil and oil products in America are on the rise and nearing levels not seen in at least 20 years.
While the I do not have access to the raw data for the OECD, graphs from the International Energy Agency show the same trend.
(If you have access to additional data on inventory levels in America, OECD or emerging markets I'd love to see it.)
I present this information not to buttress a prediction for lower oil prices but to highlight some info that contradicts the current outlook.
Some additional factors for oil:
Additional reading: http://ftalphaville.ft.com/blog/2009/07/22/63186/nothing-bullish-in-crude/
Disclosure: Personal account: long RDC, client accounts: short USO call spreads, long RDC