I guess by now the secret is out that the U.S. housing market is a little soft. The February report isn’t going to change anybody’s mind. The median sales price fell another 2% (actually 1.9%, but who’s counting) to $195,900, 8.2% lower than a year ago. Prices fell in all 4 regions of the country. There were 2 positive signs; a slight increase in the number of transactions from 4.89 million to 5.03 million homes, and a reduction in the inventory of homes for sale from 4.16 million to 4.03 million homes. You can see the full report by clicking here, Existing Home Sales, February, 2008.
There are also signs that mortgage-backed securities are beginning to trade again. That’s what we need to fix the problem. Don’t hyperventilate yet but this report is OK, Dog.
JR
to expect major Wall Street issues to feed back into the real world, a vicious cycle. The great nineteenth century economist had this right. A crisis in the realm of circulation that induces a crisis in the realm of production
John
I wish “That’s what we need to fix the problem” were accurate. But working in New York and spending time with Wall Street, what I hear lately is there is so much leverage many other dominoes will be falling.
Which is not welcome, but it’s probably best to face things squarely.
One way to look at the likely future is to expect major Wall Street issues to feed back into the real world, a vicious cycle. The great nineteenth century economist had this right. A crisis in the realm of circulation that induces a crisis in the realm of production. 150 years of economists haven’t come up with a better way of explaining why the center often doesn’t hold db