Existing U.S. Home Sales Fall for Third Month

Existing sales fell but other headlines reassure us that all is well as long as expectations are exceeded - Stocks climb after home sales top expectations. Headline spin can be a very tough nut to crack for the average investor.

Sales of existing U.S. homes fell in February for a third month, indicating a lack of jobs is hindering government efforts to revive demand.

The extension and expansion of a federal tax credit that helped stabilize housing in 2009 has yet to spark sales this year as hiring hasn’t materialized. Home Depot Inc. is among companies cutting prices to stimulate demand as the world’s largest economy recovers from the worst recession since the 1930s.

Extent and pretend is the foundation of stimulus. Extend the housing credits and pretend the benefits outweigh the costs. The reason why pretend and extend didn't work in the 30's and doesn't work today is that worst recession since 1930 is not a recession. Today's recession is part of a series of recessions and liquidity induced recoveries, jobless recoveries, that the media either cannot, through ignorance, or more likely will not, as part of pretend and extend, recognize until well after the fact.

It's up to you. People tend to see what they believe, but money demands objectivity.

Purchases dropped 0.6 percent to a 5.02 million annual rate, the lowest level in eight months and in line with the median forecast of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed today in Washington. The median price decreased 1.8 percent from February 2009.

Falling sales and lower prices generates a falling real trend.

Source: bloomberg.com