There is not going to be a massive asset price collapse.
Bargain hunters will not let it happen.
Regarding "stale" real estate inventory: Many houses, particularly those on the market a long time, are "optimistically" priced by the sellers, who apparently do not wish to actually sell.
This same principle holds on ebay and other venues, I see coins on there for years that I'd be a buyer at a third or even half the price, but the sellers never budge and seem to just want to display their museum rather than make a transaction. Some will say "they're waiting for a sucker" but with the internet opening the information vault that was closed to "outsiders" (the public) just a few years ago, everyone can comparison and price shop with a few clicks.
As someone who is actually in the market for property right now (in escrow on one and looking for yet another) I can say that if priced right, the good stuff goes quick, and if it's a Quality asset, it may even sell fast for more than initial ask, with multiple bids, as in our case. Meanwhile, other places in the areas we're shopping sit.. and sit.. and sit..
<< <i>Coho, I've lived in IMHO the nicest areas of the Bay Area and SoCal. I luv the Bay but would not consider moving back at this time.
IMHO opinion the Newport coast south to Rancho Santa Fe is the nicest place to live in the 50 states.
Cal central valley? Folsom? It may be heaven to some but not to me. _________________________________________________________
"There is not going to be a massive asset price collapse."
-------------------------until there is. 2008 RE anyone? NASDAQ? Anyone? Even the president of the stockbrokers Hall of Fame, Mr. Jamie Dimon hisself, says it's coming.
A lot of RE and many individual stocks and many many bonds are currently overpriced and ripe for an adjustment. >>
I wasnt trying to pick the nicest places in each area. That would skew the results, which is something I always try to stay away from. You should know that by now.
LA is a dump. SD is much nicer and the area in between is pretty nice.
I think you are confusing Folsom with Fresno. Check your map.
BTW--I hate the Bay area.
Oh, there will be a massive asset price collapse someday, but not from these levels. No asset classes are currently in a bubble, except perhaps Govt bonds which are heavily supported. Besides, if bonds begin to drop in price, where do you think the money is going to go? Of course individual stocks or certain areas of real estate can and will drop, but lets not get into specifics--thats an argument you lose also.
Actually physically building a house is very subject to price deflation and its gotten cheaper steadily. Either methods have sped up , need for specialized skills has gone down or materials have gotten cheaper.
Why do land prices go up? Is land scarce?
Fiat currency loses its value relentlessly and land value keeps pace but that is not enough. There are other factors at work.
As I've whined previously government piles cost into the process continuously. Is land scarce? No not here in the US in general but in specific areas .
Buyers rush into certain areas for perceived benefits of location prices rise . Areas get over built or impaired buyers leave prices crash.
Governments supported by property taxes can't tolerate price declines . Rising valuations are cover for their lust for ever increasing taxes. If prices fall they have to delay appraisals or openly increase the rate per thousand.
I submit that government is actively engaged in driving prices higher and uses regulation as their primary tool. They are content to allow us to think they are bumbling oafs . While we pat ourselves on the back for noticing , they continue to pick our pockets as usual.
While some may say its tinfoil hat thinking. Ive shed my tinfoil because tinfoil occasionally reflects a few good ideas along with the bad.
Home Construction Rebounds in a Big Way in April : Housing starts increased 20.2% in April to 1.135 mln from an upwardly revised 944,000 (from 926,000) in March. The Briefing.com Consensus expected housing starts to increase to 1.019 mln.
After the subpar first quarter, when housing starts plummeted to some of their worst levels since the middle of last year, construction levels rebounded significantly in April. In fact, the April new home construction report revealed a lot of historic "firsts." Contrary to most of the economic data thus far in 2015, these "firsts" were the good ones.
That was the first time starts reached 1.135 mln since November 2007. That was the first time starts increased by at least 20.2% in a month since a 20.9% increase in February 1991. That was the first time starts increased by at least 191,000 since starts rose by 279,000 in January 2006.
The news gets even better.
Single-family starts increased 16.7% in April to 733,000 from 628,000 in March. That was the most single-family homes started since January 2008 when 773,000 were started. That was the largest monthly increase, in both percentage and absolute terms, since November 2013.
Since single-family construction is typically a stable sector, the gain puts housing starts back on its late-2014 path.
Multifamily construction increased to 402,000 in April from 316,000 in March. The number of homes currently under construction increased 1.5% in April to 853,000 from 840,000 in Marc
Fail to provide how much of the single family data is custom (already sold) and how much is speculation (track builders betting on a future sale). I suspect it's mostly the speculators, many of whom weren't around in 08 to get caught with their pants down.
I gotta sick with the bad vibes on this data. Do not lose sight that housing starts are actually additional debt. How much of this additional debt goes bad (variable rate loans?) and eventually gets bundled into marketable products remains to be seen.
To me healthy economic data involves consumers spending money they have, not future earnings from a job that may not be there in the future.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Here in the North east, housing starts were at 0% for all of February and March so if you started up all the delayed by snow work that would look like a lot. We actually still had 2 feet of snow on the ground in the last week of April .
If you want to blame low 1Q numbers on weather , you don't get to turn around and tout high 2Q numbers as some sort of turnaround .
"And no need to fear, if the data still looks weak after the double adjustment they can always triple adjust it. That's the beauty of GDP plus...it's based on simple mathematics--you can continue to add to the GDP number until you get the desired result. Even to the point in which a Chinese government official becomes uncomfortable."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>For your 1980 figure I assume you are using a new homes stat as the article linked above states 749,000 new homes sold in 1986. This year the pace is about 500,000. If you knew anything about economics and demographics you would realize why the difference. Think huge population bulge entering their family formation years.
But lets read further into the report. In 1986 3.6 million existing homes were sold compared to a 5.2 million rate this year. Clearly people are buying more homes than you would like us to believe. And to be quite honest, I dont want sales exceeding previous peaks as that would mean the glory days would be behind us. There is still lots of growth ahead.
But lets use your logic....read further into the report. 688,000 new homes sold in 1985, vs 819,000 sold in 1977. The economy must certainly be in the dumps because less new homes were sold in 1985 than in 1977, right? I think history has certainly that logic faulty.
I beginning to think you are not really a realtor. I think you are just a salesman for one of the large tract homes builders sitting in a model home waiting for the door to open. I believe if you were a boots on the ground multi-spectrum realtor you would have a much different view.
Everyone formulates an opinion based upon the world in which they live. For some people that world consists of a 100 mile (or less) radius. For others that world is measured in 1000s of miles or spanning continents. Dont let your home town views extrapolate into a global , or even countrywide perspective. The world is much bigger than any of us realize. >>
I have been extremely busy since my post that had a few responses and I haven't had a chance to respond.
The first order of business is that I was wrong about my post. It was late when I posted it which isn't an excuse, but the numbers I was referring to were related to new home construction, not total home sales as I thought. I wasn't trying to deceive anyone, had I caught this I wouldn't have posted. You guys don't let anything by.
In Phoenix, in the last month or so sales have picked up and inventory levels are declining and it has shifted to a seller's market. There are few choices in the low end of the market. That still doesn't mean the economy is doing well.
An analysis of new home sales in the Phoenix area shows that it is the Boomers buying new homes in Phoenix, and very few Millennials. Millenials cannot seem to be able to afford (or desire to buy) new homes.
Tucked away in the pages of a new report by the U.S. General Accounting Office is a startling statistic: 40.4% of the U.S. workforce is now made up of contingent workers—that is, people who don’t have what we traditionally consider secure jobs.
In contrast, in 2005, 30.6% of workers were contingent. The biggest growth has been among people with part time jobs. They made up just 11.9% of the labor force in 2005. That means there was a 36% increase in just five years.
Show us the chart of 2015 through 2050, with the recessions shaded as usual (including the one which will eventually hit-- we're due, if not quite overdue-- and we'll know the answer. I don't remember the 1970's, and particularly 1980-1982 as particularly "prosperous", despite the low point on the graph, so I don't know why the current time, with the high on the graph, would be taken as "non-prosperous" in the aggregate, of course, individual results do vary. Interest rates were nutty high back then and I seem to remember everyone saying at the time that it was a bad thing. Now they're low and that's a bad thing too?
In Phoenix, in the last month or so sales have picked up and inventory levels are declining and it has shifted to a seller's market. There are few choices in the low end of the market. That still doesn't mean the economy is doing well
Sales usually pick up in Spring?
There is a dearth of new homes available---one cannot sell what isnt available.
No, it doesnt necessarily mean the economy is doing well, but it does mean the Phoenix real estate market is strong. So now do builders increase inventory?
New home sales increased 6.8% in April to 517,000 from an upwardly revised 484,000 (from 481,000) in March. The Briefing.com Consensus expected new home sales to increase to 510,000.
Sales topped 500,000 for the third time in the first four months of 2015. Trends are significantly stronger than they were at this time in 2014, when an average of only 421,000 homes were sold each month.
Sales growth was the strongest in the Midwest (+36.8%), which offset declines in both the Northeast (-5.6%) and West (-2.3%).
Supply problems continue to plague the sector. During normal periods of buying and selling, supply usually runs at about 6 months' at the current sales pace. Lackluster construction growth during the recovery has pushed the supply rate down to 4.8 months.
The median new home sales price increased 8.3% y/y to $297,300.
Show us the chart of 2015 through 2050, with the recessions shaded as usual (including the one which will eventually hit-- we're due, if not quite overdue-- and we'll know the answer. I don't remember the 1970's, and particularly 1980-1982 as particularly "prosperous", despite the low point on the graph, so I don't know why the current time, with the high on the graph, would be taken as "non-prosperous" in the aggregate, of course, individual results do vary. Interest rates were nutty high back then and I seem to remember everyone saying at the time that it was a bad thing. Now they're low and that's a bad thing too? >>
Well, I think it's quite easy. If that was your debt/income ratio, would you say you were heading toward or away from prosperity?
Have to love the irony on how the USDept of Justice can find bid rigging, fraud, racketeering, and corruption in the FIFA (world cup soccer) but US market regulators can't find anything in the silver and gold markets after 5 years of searching. I would suggest the CFTC get some help from O.J. to find the proof. No doubt some "bad" soccer officials going to jail here....to keep lonely Bernie Madoff company. "Bid rigging, fraud, racketeering, and corruption" are just synonyms for "legal big banking." Clearly, FIFA is not Too Big To Jail (TBTJ).
<< <i>Have to love the irony on how the USDept of Justice can find bid rigging, fraud, racketeering, and corruption in the FIFA (world cup soccer) but US market regulators can't find anything in the silver and gold markets after 5 years of searching. I would suggest the CFTC get some help from O.J. to find the proof. No doubt some "bad" soccer officials going to jail here....to keep lonely Bernie Madoff company. "Bid rigging, fraud, racketeering, and corruption" are just synonyms for "legal big banking." Clearly, FIFA is not Too Big To Jail (TBTJ).
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i> If that was your debt/income ratio, would you say you were heading toward or away from prosperity?
I'd say Toward, but would want to look at a lot more aspects of the situation than one graph. >>
I hope and assume you are joking. I agree that it doesn't paint a whole picture just as an income statement by iteself is not enough to judge a company by, I think we know what the other charts look like too.
<< <i>The US has no fear of prosecuting soccer criminals because no one likes it here. Talk about picking your spot >>
Correction: no one here likes US league soccer. World/league stuff brings the fans and ratings. >>
I wasn't throwing stones at the sport itself. I just think if it was a US favorite nothing would have been done. >>
Probably, but..eh, that investigation for FIFA has been going on for a while and had worldwide eyes on it. The briberation took world cup hosting money from US or other foreign states/cities, so this was more of an international affair pursuit. Not sure why or how much the FBI was really into the moling around honestly...maybe one of the states that didn't get the '18 or '22 cup (Atlanta was one) put some senator pressure on the BI...and then everyone else figured we'd handle it.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>Of course banks are "involved". What other way is one going to move $10 millon? Carrier pigeon? Camel? Uncle Vinny? >>
No no, they use the Universal Money that has stood the Test of Time: Old pour Engelhard bars, Zombucks and "pirate" silver rounds with skulls on them, and AGEs in MS70 plastic.
Went to the B&M today. They said activity was brisk. Everyone is buying, particularly silver. He said they are almost down to just a little 90% and some 2015 ASE's. Said they just bought a set of cc Morgans, slabbed. The guy that sold them to the dealer said he had two sets of slabbed cc's and kept the best one. Sales of gold was also pretty active but silver was flying out the door.
Please carry on with your daily activities. That is all.
Went to the B&M today. They said activity was brisk. Everyone is buying, particularly silver. He said they are almost down to just a little 90% and some 2015 ASE's. Said they just bought a set of cc Morgans, slabbed. The guy that sold them to the dealer said he had two sets of slabbed cc's and kept the best one. Sales of gold was also pretty active but silver was flying out the door.
Please carry on with your daily activities. That is all. >>
Nice 1 Baley,...
Looks like if I followed this retail anecdotal evidence, then I would be a major seller of silver...naked of course...
Any one else think it is strange that some of these socialist countries like Greece are collapsing, and even China is waste deep in debt, and yet gold and silver not only do not go up they go down?
<< <i>Any one else think it is strange that some of these socialist countries like Greece are collapsing, and even China is waste deep in debt, and yet gold and silver not only do not go up they go down? >>
This summarizes the bafflement of most of us over the past few years.
The money seems to be chasing stocks, real estate and high-end long-trend collectibles like art and Laura's stuff. We hear anecdotally it's chasing PMs as well, but the prices nosedive??
This is sure a crazy market. As everyone watches Greece they know that Italy, Portugal, Spain, and perhaps France are next in line.If all of Southern Europe goes the Euro is dead, and yet no one is buying gold? I guess from what Baley says the physical market is moving some, but the spot goes goes south.
<< <i>Any one else think it is strange that some of these socialist countries like Greece are collapsing, and even China is waste deep in debt, and yet gold and silver not only do not go up they go down? >>
This summarizes the bafflement of most of us over the past few years.
The money seems to be chasing stocks, real estate and high-end long-trend collectibles like art and Laura's stuff. We hear anecdotally it's chasing PMs as well, but the prices nosedive?? >>
Again, this is why diversification of assets is so very important. If one tanks the others rise. Never put all your eggs in one basket!
Successful trades/buys/sells with gdavis70, adriana, wondercoin, Weiss, nibanny, IrishMike, commoncents05, pf70collector, kyleknap, barefootjuan, coindeuce, WhiteTornado, Nefprollc, ajw, JamesM, PCcoins, slinc, coindudeonebay,beernuts, and many more
<< <i>This is sure a crazy market. As everyone watches Greece they know that Italy, Portugal, Spain, and perhaps France are next in line.If all of Southern Europe goes the Euro is dead, and yet no one is buying gold? I guess from what Baley says the physical market is moving some, but the spot goes goes south. >>
I think a better question is, who is selling? There is plenty of buying, especially in silver. Central banks stopped selling years ago. Where is the physical supply coming from?
<< <i>I think a better question is, who is selling? There is plenty of buying, especially in silver. Central banks stopped selling years ago. Where is the physical supply coming from? >>
Paper silver/gold futures and derivatives (ie paper) rule the metals markets in NY and London by a factor of 100X greater than actual physical metal trades. So as long as there are paper shorts (and there currently a near record number of them), the price can be pushed lower and lower, despite physical silver flying off the shelves. We already know that the TBTF banks put in a huge amount of additional derivatives on non-gold PMs in the first quarter (ie silver). That can all be found in the latest USTreasury OCC report. Citibank alone added approx $50 BILL in otc non-gold PM derivatives or approx 4 years worth of world silver production....an overall 3.37X increase in the US market. They now control 70% of non-gold precious metal derivatives. The 10X increase in commodity derivatives from $440 BILL to $4.3 TRILL was even more amazing....dwarfing anything seen in the past 15 years. JPMorgan now controls 93.4% of the otc commodity derivs. Paper rules.
We have no idea how much if any was added to the gold derivatives in the 1st quarter because "new derivative's accounting rules" require them to be lumped with FOREX derivatives. Go figure! Considering FOREX derivatives are typically about 300X larger than gold derivatives, we will never know the TBTF positioning on them ever again. Even if they increased them 10X to say a monstrous $1 TRILL, they would be hardly noticeable among the $30 TRILL Forex derivative's market. Paper rules. Physical drools....at least until the music stops and everyone rushes to find a seat.
<< <i>I think a better question is, who is selling? There is plenty of buying, especially in silver. Central banks stopped selling years ago. Where is the physical supply coming from? >>
Paper silver/gold futures and derivatives (ie paper) rule the metals markets in NY and London by a factor of 100X greater than actual physical metal trades. So as long as there are paper shorts (and there currently a near record number of them), the price can be pushed lower and lower, despite physical silver flying off the shelves. We already know that the TBTF banks put in a huge amount of additional derivatives on non-gold PMs in the first quarter (ie silver). That can all be found in the latest USTreasury OCC report. Citibank alone added approx $50 BILL in otc non-gold PM derivatives or approx 4 years worth of world silver production....an overall 3.37X increase in the US market. They now control 70% of non-gold precious metal derivatives. The 10X increase in commodity derivatives from $440 BILL to $4.3 TRILL was even more amazing....dwarfing anything seen in the past 15 years. JPMorgan now controls 93.4% of the otc commodity derivs. Paper rules.
We have no idea how much if any was added to the gold derivatives in the 1st quarter because "new derivative's accounting rules" require them to be lumped with FOREX derivatives. Go figure! Considering FOREX derivatives are typically about 300X larger than gold derivatives, we will never know the TBTF positioning on them ever again. Even if they increased them 10X to say a monstrous $1 TRILL, they would be hardly noticeable among the $30 TRILL Forex derivative's market. Paper rules. Physical drools....at least until the music stops and everyone rushes to find a seat.
I understand the paper markets, but at some point physical deliveries have to be made and are being made. Where is the silver the mint uses for its record ASE sales, as well as the silver for the mints across the world, as well as the material for all of the existing (pre-2015) ASEs and AGEs and pre-1933 gold are coming from? There is very little separation in price between physical and paper markets, so that means there is sufficient physical supply.
<< <i>I understand the paper markets, but at some point physical deliveries have to be made and are being made. Where is the silver the mint uses for its record ASE sales, as well as the silver for the mints across the world, as well as the material for all of the existing (pre-2015) ASEs and AGEs and pre-1933 gold are coming from? There is very little separation in price between physical and paper markets, so that means there is sufficient physical supply. >>
Most futures players do not take delivery. While there may be sufficient physical supply to meet consumer demand there is a very large shortage in the Exchange vaults to satisfy all the futures buyers. When and if a majority of them demand delivery the fireworks will commence.
<< <i>Yeah, lets blame the banksters for driving silver price lower when in fact demand for ASE is down 40% since 2011. >>
ASE (or any silver coin) demand has nothing to do with the price of silver. At best coin demand may affect premiums. Even you should know that.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>ASE (or any silver coin) demand has nothing to do with the price of silver. At best coin demand may affect premiums. Even you should know that
So do we need to dig up all the posts you made about incredible silver demand and how that was good for prices and was going to push it even higher? >>
He might have found that out after buying at $40+, then $35+, then $30+, then $25+, then again at $20+...
<< <i>ASE (or any silver coin) demand has nothing to do with the price of silver. At best coin demand may affect premiums. Even you should know that
So do we need to dig up all the posts you made about incredible silver demand and how that was good for prices and was going to push it even higher? >>
Sure, dig away. Humility is good for the soul. The major difference between you (and a few others here) and I is I'm smart enough to know that I don't know everything.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Comments
<< <i>Would a comparison from $hothole LA be better? >>
If you think you are qualified then go for it. Hasn't stopped you before.
Bargain hunters will not let it happen.
Regarding "stale" real estate inventory: Many houses, particularly those on the market a long time, are "optimistically" priced by the sellers, who apparently do not wish to actually sell.
This same principle holds on ebay and other venues, I see coins on there for years that I'd be a buyer at a third or even half the price, but the sellers never budge and seem to just want to display their museum rather than make a transaction. Some will say "they're waiting for a sucker" but with the internet opening the information vault that was closed to "outsiders" (the public) just a few years ago, everyone can comparison and price shop with a few clicks.
As someone who is actually in the market for property right now (in escrow on one and looking for yet another) I can say that if priced right, the good stuff goes quick, and if it's a Quality asset, it may even sell fast for more than initial ask, with multiple bids, as in our case. Meanwhile, other places in the areas we're shopping sit.. and sit.. and sit..
Liberty: Parent of Science & Industry
<< <i>Coho,
I've lived in IMHO the nicest areas of the Bay Area and SoCal. I luv the Bay but would not consider moving back at this time.
IMHO opinion the Newport coast south to Rancho Santa Fe is the nicest place to live in the 50 states.
Cal central valley? Folsom?
_________________________________________________________
"There is not going to be a massive asset price collapse."
-------------------------until there is. 2008 RE anyone? NASDAQ? Anyone? Even the president of the stockbrokers Hall of Fame, Mr. Jamie Dimon hisself, says it's coming.
A lot of RE and many individual stocks and many many bonds are currently overpriced and ripe for an adjustment. >>
I wasnt trying to pick the nicest places in each area. That would skew the results, which is something I always try to stay away from. You should know that by now.
LA is a dump. SD is much nicer and the area in between is pretty nice.
I think you are confusing Folsom with Fresno. Check your map.
BTW--I hate the Bay area.
Oh, there will be a massive asset price collapse someday, but not from these levels. No asset classes are currently in a bubble, except perhaps Govt bonds which are heavily supported. Besides, if bonds begin to drop in price, where do you think the money is going to go? Of course individual stocks or certain areas of real estate can and will drop, but lets not get into specifics--thats an argument you lose also.
Knowledge is the enemy of fear
<< <i>
<< <i>Would a comparison from $hothole LA be better? >>
If you think you are qualified then go for it. Hasn't stopped you before.
Like 2 guys being chased by a mountain lion....I dont need to be fast, just faster than you. That goes for anything.
Knowledge is the enemy of fear
Actually physically building a house is very subject to price deflation and its gotten cheaper steadily. Either methods have sped up , need for specialized skills has gone down or materials have gotten cheaper.
Why do land prices go up? Is land scarce?
Fiat currency loses its value relentlessly and land value keeps pace but that is not enough. There are other factors at work.
As I've whined previously government piles cost into the process continuously. Is land scarce? No not here in the US in general but in specific areas .
Buyers rush into certain areas for perceived benefits of location prices rise . Areas get over built or impaired buyers leave prices crash.
Governments supported by property taxes can't tolerate price declines . Rising valuations are cover for their lust for ever increasing taxes. If prices fall they have to delay appraisals or openly increase the rate per thousand.
I submit that government is actively engaged in driving prices higher and uses regulation as their primary tool. They are content to allow us to think they are bumbling oafs . While we pat ourselves on the back for noticing , they continue to pick our pockets as usual.
While some may say its tinfoil hat thinking. Ive shed my tinfoil because tinfoil occasionally reflects a few good ideas along with the bad.
I'm rolling with this now
Home Construction Rebounds in a Big Way in April : Housing starts increased 20.2% in April to 1.135 mln from an upwardly revised 944,000 (from 926,000) in March. The Briefing.com Consensus expected housing starts to increase to 1.019 mln.
After the subpar first quarter, when housing starts plummeted to some of their worst levels since the middle of last year, construction levels rebounded significantly in April. In fact, the April new home construction report revealed a lot of historic "firsts." Contrary to most of the economic data thus far in 2015, these "firsts" were the good ones.
That was the first time starts reached 1.135 mln since November 2007. That was the first time starts increased by at least 20.2% in a month since a 20.9% increase in February 1991. That was the first time starts increased by at least 191,000 since starts rose by 279,000 in January 2006.
The news gets even better.
Single-family starts increased 16.7% in April to 733,000 from 628,000 in March. That was the most single-family homes started since January 2008 when 773,000 were started. That was the largest monthly increase, in both percentage and absolute terms, since November 2013.
Since single-family construction is typically a stable sector, the gain puts housing starts back on its late-2014 path.
Multifamily construction increased to 402,000 in April from 316,000 in March. The number of homes currently under construction increased 1.5% in April to 853,000 from 840,000 in Marc
Read more: http://www.briefing.com/GeneralContent/Platinum/Active/TickerSearch/QuickSearch.aspx#ixzz3ab4qaJpu
Knowledge is the enemy of fear
Liberty: Parent of Science & Industry
I gotta sick with the bad vibes on this data. Do not lose sight that housing starts are actually additional debt. How much of this additional debt goes bad (variable rate loans?) and eventually gets bundled into marketable products remains to be seen.
To me healthy economic data involves consumers spending money they have, not future earnings from a job that may not be there in the future.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Here in the North east, housing starts were at 0% for all of February and March so if you started up all the delayed by snow work that would look like a lot. We actually still had 2 feet of snow on the ground in the last week of April .
If you want to blame low 1Q numbers on weather , you don't get to turn around and tout high 2Q numbers as some sort of turnaround .
Financial analyst Bob Hoye always an interesting read whether it's about global warming and sun cycles or the car market.
"And no need to fear, if the data still looks weak after the double adjustment they can always triple adjust it. That's the beauty of GDP plus...it's based on simple mathematics--you can continue to add to the GDP number until you get the desired result. Even to the point in which a Chinese government official becomes uncomfortable."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>For your 1980 figure I assume you are using a new homes stat as the article linked above states 749,000 new homes sold in 1986. This year the pace is about 500,000. If you knew anything about economics and demographics you would realize why the difference. Think huge population bulge entering their family formation years.
But lets read further into the report. In 1986 3.6 million existing homes were sold compared to a 5.2 million rate this year. Clearly people are buying more homes than you would like us to believe. And to be quite honest, I dont want sales exceeding previous peaks as that would mean the glory days would be behind us. There is still lots of growth ahead.
But lets use your logic....read further into the report. 688,000 new homes sold in 1985, vs 819,000 sold in 1977. The economy must certainly be in the dumps because less new homes were sold in 1985 than in 1977, right? I think history has certainly that logic faulty.
I beginning to think you are not really a realtor. I think you are just a salesman for one of the large tract homes builders sitting in a model home waiting for the door to open. I believe if you were a boots on the ground multi-spectrum realtor you would have a much different view.
Everyone formulates an opinion based upon the world in which they live. For some people that world consists of a 100 mile (or less) radius. For others that world is measured in 1000s of miles or spanning continents. Dont let your home town views extrapolate into a global , or even countrywide perspective. The world is much bigger than any of us realize. >>
I have been extremely busy since my post that had a few responses and I haven't had a chance to respond.
The first order of business is that I was wrong about my post. It was late when I posted it which isn't an excuse, but the numbers I was referring to were related to new home construction, not total home sales as I thought. I wasn't trying to deceive anyone, had I caught this I wouldn't have posted. You guys don't let anything by.
In Phoenix, in the last month or so sales have picked up and inventory levels are declining and it has shifted to a seller's market. There are few choices in the low end of the market. That still doesn't mean the economy is doing well.
An analysis of new home sales in the Phoenix area shows that it is the Boomers buying new homes in Phoenix, and very few Millennials. Millenials cannot seem to be able to afford (or desire to buy) new homes.
Dallas Fed Manufacturing Index Collapses: Lowest Production Reading in 6 Years, Orders Contract 7th Month, New Orders 5th Month
Shocker: 40% of Workers Now Have 'Contingent' Jobs, Says U.S. Government
Tucked away in the pages of a new report by the U.S. General Accounting Office is a startling statistic: 40.4% of the U.S. workforce is now made up of contingent workers—that is, people who don’t have what we traditionally consider secure jobs.
In contrast, in 2005, 30.6% of workers were contingent. The biggest growth has been among people with part time jobs. They made up just 11.9% of the labor force in 2005. That means there was a 36% increase in just five years.
<< <i>A picture of prosperity?
Dunno.
Show us the chart of 2015 through 2050, with the recessions shaded as usual (including the one which will eventually hit-- we're due, if not quite overdue-- and we'll know the answer. I don't remember the 1970's, and particularly 1980-1982 as particularly "prosperous", despite the low point on the graph, so I don't know why the current time, with the high on the graph, would be taken as "non-prosperous" in the aggregate, of course, individual results do vary.
Interest rates were nutty high back then and I seem to remember everyone saying at the time that it was a bad thing.
Now they're low and that's a bad thing too?
Liberty: Parent of Science & Industry
Sales usually pick up in Spring?
There is a dearth of new homes available---one cannot sell what isnt available.
No, it doesnt necessarily mean the economy is doing well, but it does mean the Phoenix real estate market is strong. So now do builders increase inventory?
_______________________________________________________________________
New Home Sales Recover After a Down Month
New home sales increased 6.8% in April to 517,000 from an upwardly revised 484,000 (from 481,000) in March. The Briefing.com Consensus expected new home sales to increase to 510,000.
Sales topped 500,000 for the third time in the first four months of 2015. Trends are significantly stronger than they were at this time in 2014, when an average of only 421,000 homes were sold each month.
Sales growth was the strongest in the Midwest (+36.8%), which offset declines in both the Northeast (-5.6%) and West (-2.3%).
Supply problems continue to plague the sector. During normal periods of buying and selling, supply usually runs at about 6 months' at the current sales pace. Lackluster construction growth during the recovery has pushed the supply rate down to 4.8 months.
The median new home sales price increased 8.3% y/y to $297,300.
Read more: http://www.briefing.com/GeneralContent/Platinum/Active/ArticlePopup/ArticlePopup.aspx?SiteName=PopUp&ArticleId=IN20150526101719ECONX#ixzz3bImt5cVp
Knowledge is the enemy of fear
<< <i>Dunno.
Show us the chart of 2015 through 2050, with the recessions shaded as usual (including the one which will eventually hit-- we're due, if not quite overdue-- and we'll know the answer. I don't remember the 1970's, and particularly 1980-1982 as particularly "prosperous", despite the low point on the graph, so I don't know why the current time, with the high on the graph, would be taken as "non-prosperous" in the aggregate, of course, individual results do vary.
Interest rates were nutty high back then and I seem to remember everyone saying at the time that it was a bad thing.
Now they're low and that's a bad thing too? >>
Well, I think it's quite easy. If that was your debt/income ratio, would you say you were heading toward or away from prosperity?
I'd say Toward, but would want to look at a lot more aspects of the situation than one graph.
Liberty: Parent of Science & Industry
Corruption was nearly "institutionalized" in world soccer
<< <i>Have to love the irony on how the USDept of Justice can find bid rigging, fraud, racketeering, and corruption in the FIFA (world cup soccer) but US market regulators can't find anything in the silver and gold markets after 5 years of searching. I would suggest the CFTC get some help from O.J. to find the proof. No doubt some "bad" soccer officials going to jail here....to keep lonely Bernie Madoff company. "Bid rigging, fraud, racketeering, and corruption" are just synonyms for "legal big banking." Clearly, FIFA is not Too Big To Jail (TBTJ).
Corruption was nearly "institutionalized" in world soccer >>
You gotta put money in the right pockets.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
The US has no fear of prosecuting soccer criminals because no one likes it here. Talk about picking your spot
<< <i>The US has no fear of prosecuting soccer criminals because no one likes it here. Talk about picking your spot
Correction: no one here likes US league soccer. World/league stuff brings the fans and ratings.
<< <i> If that was your debt/income ratio, would you say you were heading toward or away from prosperity?
I'd say Toward, but would want to look at a lot more aspects of the situation than one graph. >>
I hope and assume you are joking.
I agree that it doesn't paint a whole picture just as an income statement by iteself is not enough to judge a company by, I think we know what the other charts look like too.
<< <i>
<< <i>The US has no fear of prosecuting soccer criminals because no one likes it here. Talk about picking your spot
Correction: no one here likes US league soccer. World/league stuff brings the fans and ratings. >>
I wasn't throwing stones at the sport itself. I just think if it was a US favorite nothing would have been done.
<< <i>
<< <i>
<< <i>The US has no fear of prosecuting soccer criminals because no one likes it here. Talk about picking your spot
Correction: no one here likes US league soccer. World/league stuff brings the fans and ratings. >>
I wasn't throwing stones at the sport itself. I just think if it was a US favorite nothing would have been done. >>
Probably, but..eh, that investigation for FIFA has been going on for a while and had worldwide eyes on it. The briberation took world cup hosting money from US or other foreign states/cities, so this was more of an international affair pursuit. Not sure why or how much the FBI was really into the moling around honestly...maybe one of the states that didn't get the '18 or '22 cup (Atlanta was one) put some senator pressure on the BI...and then everyone else figured we'd handle it.
<< <i>The US has no fear of prosecuting soccer criminals because no one likes it here. Talk about picking your spot
Another Blatant Attempt By The US To Meddle Outside Its Jurisdiction
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Knowledge is the enemy of fear
<< <i>
<< <i>The US has no fear of prosecuting soccer criminals because no one likes it here. Talk about picking your spot
Another Blatant Attempt By The US To Meddle Outside Its Jurisdiction >>
Sort of like a guy with a bag of weed goes to jail , but a guy that steals a few billion gets invited to dinner at the white house ?
<< <i>What is soccer? >>
little league football
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
looks like some wall street banks are involved in the soccer thing, who'd a thunk it? Link has a bad word in it remove the *
https://secure.market*watch.com/story/wall-street-banks-are-being-drawn-into-the-fifa-bribery-probe-2015-05-28
Knowledge is the enemy of fear
<< <i>Of course banks are "involved". What other way is one going to move $10 millon? Carrier pigeon? Camel? Uncle Vinny? >>
No no, they use the Universal Money that has stood the Test of Time: Old pour Engelhard bars, Zombucks and "pirate" silver rounds with skulls on them, and AGEs in MS70 plastic.
Liberty: Parent of Science & Industry
Went to the B&M today. They said activity was brisk. Everyone is buying, particularly silver. He said they are almost down to just a little 90% and some 2015 ASE's. Said they just bought a set of cc Morgans, slabbed. The guy that sold them to the dealer said he had two sets of slabbed cc's and kept the best one. Sales of gold was also pretty active but silver was flying out the door.
Please carry on with your daily activities. That is all.
<< <i>News from the front:
Went to the B&M today. They said activity was brisk. Everyone is buying, particularly silver. He said they are almost down to just a little 90% and some 2015 ASE's. Said they just bought a set of cc Morgans, slabbed. The guy that sold them to the dealer said he had two sets of slabbed cc's and kept the best one. Sales of gold was also pretty active but silver was flying out the door.
Please carry on with your daily activities. That is all. >>
Nice 1 Baley,...
Looks like if I followed this retail anecdotal evidence, then I would be a major seller of silver...naked of course...
<< <i>Any one else think it is strange that some of these socialist countries like Greece are collapsing, and even China is waste deep in debt, and yet gold and silver not only do not go up they go down? >>
This summarizes the bafflement of most of us over the past few years.
The money seems to be chasing stocks, real estate and high-end long-trend collectibles like art and Laura's stuff. We hear anecdotally it's chasing PMs as well, but the prices nosedive??
Here's a warning parable for coin collectors...
<< <i>
<< <i>Any one else think it is strange that some of these socialist countries like Greece are collapsing, and even China is waste deep in debt, and yet gold and silver not only do not go up they go down? >>
This summarizes the bafflement of most of us over the past few years.
The money seems to be chasing stocks, real estate and high-end long-trend collectibles like art and Laura's stuff. We hear anecdotally it's chasing PMs as well, but the prices nosedive?? >>
Again, this is why diversification of assets is so very important.
If one tanks the others rise.
Never put all your eggs in one basket!
<< <i>This is sure a crazy market. As everyone watches Greece they know that Italy, Portugal, Spain, and perhaps France are next in line.If all of Southern Europe goes the Euro is dead, and yet no one is buying gold? I guess from what Baley says the physical market is moving some, but the spot goes goes south. >>
I think a better question is, who is selling? There is plenty of buying, especially in silver.
Central banks stopped selling years ago. Where is the physical supply coming from?
<< <i>I think a better question is, who is selling? There is plenty of buying, especially in silver. Central banks stopped selling years ago. Where is the physical supply coming from? >>
Paper silver/gold futures and derivatives (ie paper) rule the metals markets in NY and London by a factor of 100X greater than actual physical metal trades. So as long as there are paper shorts (and there currently a near record number of them), the price can be pushed lower and lower, despite physical silver flying off the shelves. We already know that the TBTF banks put in a huge amount of additional derivatives on non-gold PMs in the first quarter (ie silver). That can all be found in the latest USTreasury OCC report. Citibank alone added approx $50 BILL in otc non-gold PM derivatives or approx 4 years worth of world silver production....an overall 3.37X increase in the US market. They now control 70% of non-gold precious metal derivatives. The 10X increase in commodity derivatives from $440 BILL to $4.3 TRILL was even more amazing....dwarfing anything seen in the past 15 years. JPMorgan now controls 93.4% of the otc commodity derivs. Paper rules.
We have no idea how much if any was added to the gold derivatives in the 1st quarter because "new derivative's accounting rules" require them to be lumped with FOREX derivatives. Go figure! Considering FOREX derivatives are typically about 300X larger than gold derivatives, we will never know the TBTF positioning on them ever again. Even if they increased them 10X to say a monstrous $1 TRILL, they would be hardly noticeable among the $30 TRILL Forex derivative's market. Paper rules. Physical drools....at least until the music stops and everyone rushes to find a seat.
OCC page 21-23
<< <i>
<< <i>I think a better question is, who is selling? There is plenty of buying, especially in silver. Central banks stopped selling years ago. Where is the physical supply coming from? >>
Paper silver/gold futures and derivatives (ie paper) rule the metals markets in NY and London by a factor of 100X greater than actual physical metal trades. So as long as there are paper shorts (and there currently a near record number of them), the price can be pushed lower and lower, despite physical silver flying off the shelves. We already know that the TBTF banks put in a huge amount of additional derivatives on non-gold PMs in the first quarter (ie silver). That can all be found in the latest USTreasury OCC report. Citibank alone added approx $50 BILL in otc non-gold PM derivatives or approx 4 years worth of world silver production....an overall 3.37X increase in the US market. They now control 70% of non-gold precious metal derivatives. The 10X increase in commodity derivatives from $440 BILL to $4.3 TRILL was even more amazing....dwarfing anything seen in the past 15 years. JPMorgan now controls 93.4% of the otc commodity derivs. Paper rules.
We have no idea how much if any was added to the gold derivatives in the 1st quarter because "new derivative's accounting rules" require them to be lumped with FOREX derivatives. Go figure! Considering FOREX derivatives are typically about 300X larger than gold derivatives, we will never know the TBTF positioning on them ever again. Even if they increased them 10X to say a monstrous $1 TRILL, they would be hardly noticeable among the $30 TRILL Forex derivative's market. Paper rules. Physical drools....at least until the music stops and everyone rushes to find a seat.
OCC page 21-23 >>
I understand the paper markets, but at some point physical deliveries have to be made and are being made. Where is the silver the mint uses for its record ASE sales, as well as the silver for the mints across the world, as well as the material for all of the existing (pre-2015) ASEs and AGEs and pre-1933 gold are coming from? There is very little separation in price between physical and paper markets, so that means there is sufficient physical supply.
Central banks stopped selling years ago. Where is the physical supply coming from?
The ground. Most miners have reported increases, in many cases large increases, in production.
Knowledge is the enemy of fear
Knowledge is the enemy of fear
<< <i>I understand the paper markets, but at some point physical deliveries have to be made and are being made. Where is the silver the mint uses for its record ASE sales, as well as the silver for the mints across the world, as well as the material for all of the existing (pre-2015) ASEs and AGEs and pre-1933 gold are coming from? There is very little separation in price between physical and paper markets, so that means there is sufficient physical supply. >>
Most futures players do not take delivery. While there may be sufficient physical supply to meet consumer demand there is a very large shortage in the Exchange vaults to satisfy all the futures buyers. When and if a majority of them demand delivery the fireworks will commence.
<< <i>Yeah, lets blame the banksters for driving silver price lower when in fact demand for ASE is down 40% since 2011. >>
ASE (or any silver coin) demand has nothing to do with the price of silver. At best coin demand may affect premiums. Even you should know that.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
So do we need to dig up all the posts you made about incredible silver demand and how that was good for prices and was going to push it even higher?
Knowledge is the enemy of fear
<< <i>ASE (or any silver coin) demand has nothing to do with the price of silver. At best coin demand may affect premiums. Even you should know that
So do we need to dig up all the posts you made about incredible silver demand and how that was good for prices and was going to push it even higher? >>
He might have found that out after buying at $40+, then $35+, then $30+, then $25+, then again at $20+...
<< <i>ASE (or any silver coin) demand has nothing to do with the price of silver. At best coin demand may affect premiums. Even you should know that
So do we need to dig up all the posts you made about incredible silver demand and how that was good for prices and was going to push it even higher? >>
Sure, dig away. Humility is good for the soul. The major difference between you (and a few others here) and I is I'm smart enough to know that I don't know everything.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey