Since you guys did such a nice job with the  last one, lets give this another run: Time for another freewheeling discussion.

Rates, Real Estate, Energy, Earnings, Technicals:  whats on the collective hive mind?

What say ye:

Category: Weblogs

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

41 Responses to “Open Thread”

  1. me2200 says:

    hat jobs number this morning was ominous. Bernanke should have hiked 50 basis points.
    We’ve got a mess on our hands. Oil at $75 and no retreat in sight. Strong job growth. Rising rents. The next inflation numbers are going to be killers.
    Bernanke has no choice but to continue hiking, housing market be damned. Now the folly of our ways and the Feds ways are going to come through loud and clear. We must continue hiking to keep inflation under control. It doesn’t matter that millions of households are going to financially perish when they can’t service their mortgages.
    This is going to get ugly.
    It could have all been prevented by raising rates sooner. Didn’t anyone see that ? All this talk of one and done and 4% being neutral was BS. Why the hell did Greenspan let the housing bubble keep growing ? Idiot. He couldn’t see it ? Was he blind ?
    BTW: I’ve made a ton of $$$ in oil stocks lately. Devon, COP and Talisman. I was in before the Bernanke speach and sold off at a gain. I bought in immediately after and am still riding up.

  2. Craig H says:

    If commodities don’t cool it we’ll be hearing some squawking from the hawks on the Fed soon.

  3. Mr. Beach says:

    Here is my question to you guys.

    When is it safe to get back into bonds?

    Will the 10-year continue to ratchet upwards with every new inflation scare?

  4. Bob_in_MA says:

    The WSJ did its (semiannual?) survey of economists and while there’s nothing startling in the forecasts, looking at how horribly wrong they were (as a group) on just about every measure last time might provide some entertainment.

    Personally, I’m not sure if we’re waiting for the bear’s other shoe to drop or not. I’m still in a pretty defensive position, but I don’t want to be sitting with so much money in cash three months into the next bull market.

    I’m thinking of starting to go long, but with covered-calls to buffer any slippage.

  5. My bet is he stops at 6% as the carnage from ARM foreclosures start to really make a noise, after that, commodities skyrocket.

    It’s an election year, I don’t think the fed has the spine to withstand the number of foreclosures that would result in an appropriate interest rate of 11%. That is of course if they would stop injecting more liquidity into the mix. It’s still a credit and derivative mania out there-

    “New credit derivatives vehicles planned”

    http://www.ft.com/cms/s/6e2f383e-0b7c-11db-b97f-0000779e2340.html

    Stagflation, yippee.

  6. Brian says:

    They’ll pull every trick out of the hat to keep things afloat until the election. So we’ll probably have a nice rally for the next few months.

    I’m down to three energy stocks, a pharma stock, and a booze stock. Don’t see oil getting cheaper. People always need their drugs and drinky drinky.

    Oil bulls got another bit of good news: now the lefty is ahead in the recount in Mexico. We get a ton of oil from Mexico.

  7. sell_the_10_year says:

    My two cents: Barry, you are blogging far too much on your vacation! These markets aren’t going anywhere, enjoy life while you can.

  8. Steve C says:

    Mr. Beach – look at today’s Markets in The Big Picture where the 10 yr bond yield is discussed in relation to the 2nd presidential year (what we’re in now). If the graph is correct NOW is the time to be in bonds!
    Another topic: Mark Hulbert of Hulbert’s Financial digest just put out an article on MarketWatch discussing the impact on the market of two or more 10 to 1 up volume over down vol. days. We just had two – June 15 and 21st, if I remember correctly. This occurence usually results in a up market of 6 or 9 months duration after these large up days. This forcasted outcome was worked out by Martin Zweig (ex-panelist on W$ Week), We’ll see.

  9. o-o-o says:

    I guess I need to know what finacially is under the hood of the lending organizations putting out ARMS. Where are ARM/IO lenders getting the money they themselves loan out, and at what terms?

    Until I know that, I’m not seeing a hard linkage between Fed rates and ARM/IO mortgages. So far anyone attempting to call an ARM/IO based RE bubble based purely on Fed rate increases has been wrong.

  10. Michael L. says:

    You suppose Helicopter Ben is ticked at Greenie?!!! LOL.
    Greenie will be shown as the one responsible for all the crashes and inflation when history is viewed from a LT stance. Instead of raising margin reqmts in the dot.com boom, he poured gasoline on it. Then he got scared with Y2k and let the money supply ramp which resulted in the blowoff, then he cut rates and begged people to borrow which inflated the housing boom. One problem after another.

    re: bonds. Bennie has to keep raising rates but I think one could nibble a bit on bonds as protection should the Fed miscalculate and put a company/industry thru the windshield.

    I’d only guess that the Fed will stop hikes sometime before the midterm election to avoid playing favorites.
    Some predicting gold will blow thru the roof if the Fed steps aside.

    I think the mkts work their way lower thru Q3 but we’ll have these furious bear rallies like the one off the June 13. Kill some shorts, get the bulls chasing the train, then take ‘em back down again.

  11. whipsaw says:

    Speaking of stagflation, there is a nice primer on it at http://www.minyanville.com/articles/index.php?a=10604 for any of you who aren’t old enough to remember getting beat up in the 70s. Well worth a couple of minutes to read.

  12. o-o-o says:

    Bush has no successor planned. Nor will his VP run. It’s going to be a wide open slate with all new candidates for both parties.

    I predict a recession will be staved off until after the November elections, then Bush’s tenure will end with a recession. And he won’t care, nor is he attempting to “guard his legacy” by picking any candidate to succeed him in office that he’d need to juice up the economy to insure placement of.

    All party candidates will be running on their own merits. There will be no riding in on the coattails of a sitting President the way Bush 41 did with Reagan. In fact, both parties will probably be distancing themselves from Bush 43.

    I expect no special goosing of the economy to either party’s advantage come 2008. It’s quite possible we could get a long, drawn out recession that will drag out to the second year of the next Presidential term.

  13. jason says:

    I’ve lately been wondering how bad housing is going to get. I see a lot of housing bears talk about how the froth is concentrated on the coasts. I just sold my home in San Fran and, yes, it’s a bubble here but I believe the bubble is everywhere. I have been looking to purchase a rental property in Dallas and while the averages & medians seem reasonable, the desireable pockets are unaffordable and have been appreciating at 20% Y/Y clips. The burbs on the other hand have had unrestrained building and lots of competition, so those prices remain low and supress the city-wide average. I think the froth is masked in cheaper parts of the country where building has been rampant. How is it that those overbuild mid-west communities are immune as rates continue to rise? I think we’re headed for a bigger bubble deflation across the board than anyone’s currently predicting.

  14. Cherry says:

    The massive speculatory bubble and its devil the Real Estate bubble are near popping!!!

    Strong job growth? Hardly, expect revisions down(as there has been every month just about) and losses in jobs by the end of the year. Job growth has not been “strong” for this expansion which has not pressured wages. Inflation isn’t a problem either as the Q3 and Q4 will flatten the economy. Deflation is the real problem. Oil 80? Again, who cares that isn’t the economic real problem. That is along with other commodity growth and inflation inside the system is due to the massive amounts of liquidty being pumped into it along with piles and piles of debt. Sound familiar?

    sssssssssssssssssssBOOM!!!!!!!!!!!!

  15. niblettes says:

    So, with all the inflation/election/energy jitters, wouldn’t purchasing real estate now (before rates go higher to resist inflation) and locking in for a 5 year term (putting you half way though the next president’s first term, and hopefully on the other side of a possible recession) be a prudent way to go?

  16. ~ Nona says:

    Whipsaw is doing great in his metals trades, which now include silver.

    I noticed the Kudlow show, without K, gave a lot of time to today’s gold run-up. Everyday Economist, could you let us know your thinking about gold in light of today’s action? All the more reason to dump? Or the reason to stay in?

  17. Gunther says:

    Rates
    Theates were very long very low. That created inflation pressure that will be cured with higher rates. The reason is IMO that the Fed has to keep the dollar more or less strong. The higher rates will drive business cost and rents up adding to the inflation pressure.
    Real estate
    Everyone with adjustable debt from ARM to credit card debt will suffer, real estate will come down in price. Every trick has been used to keep monthly payments low. I can not imagine much more tricks to lower mortgage payments. If spending power remains constant, property prices have to come down to make the deal at higher rates possible. If homeowners with an ARM realize that the next buyer with the same income can only afford to pay say 80% of the price things can get ugly. That may take a while but seems probable to me. The inverted yield curve points in a similar direction. The high energy prices add pressure too.

  18. RB says:

    How does one reconcile the traditional Presidential cycle with a recession — only if we enter a recession in Q4 and bottom early next year, or this is just a baby bear market or the traditional Presidential cycle is overturned. With regards to Steve C’s post: there was another post regarding the occurrence of multiple Lowry’s 90 percent downside and upside days this past month. Is that a portent of good things or bad things?

    There will be no real estate crash because the retail renter expects it. Prices will decline because the retail owner does not expect it. It will be gradual, like always, in textbook fashion.

    Those are my thoughts for the day.

  19. “History has not dealt kindly with the aftermath of protracted periods of low risk premiums.” — Alan Greenspan, August 2005

    Translation: Cheap central bank credit extended for too long leads to recessions and depressions.

    And who said Greenspan’s comments were always opaque or obfuscating?

    All credit extended gets retracted… either by repayment, restructuring or write off. Now… what combination of these three will proceed over the next decade?

    Better to be conservative and short than optimistic and long. Especially as risk premiums were negative for years. Come to think of it, with real inflation currently understated (using phoney rates incorporating replacement adjustment theory), the carry trade continues even with FED target now 5.25 or 5.5%.

  20. Sammy20 says:

    We will see at most 1 more hike. After the possible hike in August the Fed will reason that the economy has gone from moderating to full fledge slowing and that inflation isn’t really a problem due to the OER component that really should not be factored in…As ridiculous as that excuse is, I think that is where they are going to go.

    The Fed is absolutely stuck and I believe they realize they can not go much further. The dollar will be the one that pays.

    As for Kudlow’s show, I have a second favorite after Barry now. Peter Schiff, although a little extreme sticks to his guns and raises excellent points that the permabulls so frequently disregard in their “this market is cheap” blindness.

  21. I noticed BR’s TV buddy Kudlow finished in the bottom five of the WSJ’s forecasting study.

    http://online.wsj.com/article/SB115161638887894638.html?mod=home_whats_news_us

    I point this out only to provoke comments from the Kudlow-haters.

    On a more serious note, I believe that the Fed will go to 5.5%, but that they should go to 5.75%.

    ~ Nona, let me clarify my position on gold. If you own a great deal of gold, I think it is time to take a little off the table. There is nothing wrong with taking a profit. However, gold will likely continue to rise (modestly) until the Fed is done.

    In the near term, gold is definitely ripe for a trade (right whipsaw?) as many who are holding excess dollars due to the trade deficit look for somewhere else to put their money. At least that is what these stories would lead me to believe:

    http://www.thestandard.com.hk/news_detail.asp?pp_cat=22&art_id=22112&sid=8690191&con_type=1

    http://www.ameinfo.com/90460.html

  22. erik says:

    interesting to see a bearish divergence in golds with the xau dropping with gold continuing to rise. i don’t know how much weight i would put in it though, since we had a similar divergence in early april right before things went parabolic. i remember because i got burned on that run.

    i could possibly see an echo of that behavior here again if the overall market takes flight with a head fake over 1290 and to new highs in the coming weeks. gold over the past 6 months has not had a typical rise but has led, with the oils and industrial metals, the overall market. things shouldn’t change if speculation takes one last gasp before the flat line this fall. what an appropriate name for the season.

    although, that just looks to clean and neat for me. wouldn’t a slow protracted decline over the next two years cause the most pain here for such an impatient market place (both bulls and bears alike)?

    hmmm, i think i might look at some october 2007 puts…

  23. Peter Schiff says:

    The Reality of Stagflation

    Now that the Fed has raised rates to 5.25%, and has left the door open for future increases, the overriding concern is that over-tightening will tip the economy into recession. However, given the state of our imbalanced economy, a recession is not only inevitable, but absolutely necessary, and will occur no matter what the Fed does. Furthermore, the coming recession will not come about because the Fed went too far, but because it did not go far enough.

    The U.S. economy suffers from extreme economic imbalances that must be resolved. The longer they persist, the more difficult and painful their ultimate resolution will be. The imbalances result primarily from an excess of consumption and borrowing, and insufficient savings and production, and can only be resolved by less of the former and more of the latter. Recession is not the only way to reduce consumption, but since our economy is 70% consumption, any noticeable dip in consumption will lead to recession. The Fed should not prevent this from occurring any more than a clinician at a rehabilitation center should try to prevent a patient from suffering withdrawal by giving him more heroin.

    When the recession occurs it will not be the result of the recent run of Fed rate hikes, but the irresponsible manner in which it lowered them, and kept them low, in the first place. One common misperception is that given the absence of wage pressures, Bernanke is over-reacting to a non-existent inflation threat. However, this naïve view misses the point that rising wages, just like other prices (wages are the price paid for labor), do not cause inflation, but result from it. More importantly, wages usually are among the last prices to adjust upwards in response to inflation, which is one reason that inflation is so damaging. Waiting for an up tick in wages to confirm inflation is analogous to waiting for the caboose to evidence an oncoming train.

    Given the current post-industrial state of the U.S. economy, the gap between wages and the cost of living will likely grow more than in prior inflationary periods, making the current experience that much more painful. Economists are also mistaken in their belief that a weakening economy will counteract inflationary pressures. This overlooks the fact that a weakening U.S. dollar will stimulate demand abroad at the same time it restrains it here at home. So even as Americans consume less, prices will continue to rise as they are forced to compete with wealthier foreigners for scarce consumer goods.

    Another major problem is that the housing bubble has finally burst. Thus far it has only produced a slow leak, but by next year the air will be rushing out with gale force winds. Because the loss of paper wealth and the purchasing power associated with it could potentially produce a recession, some argue that the Fed should pause. Ironically, one of the only remaining props in the housing market is the belief that the Fed will keep raising rates, which pushes remaining home buyers to buy before mortgage rates move up. However, once the general perception is that the Fed is done, this last remaining prop will be gone.

    If Bernanke tries to borrow from Greenspan’s playbook and attempts to prevent or mitigate the severity of the coming recession, the excess liquidity will not simply move into another asset class, as it did from stocks to real estate, but into real stuff, such as commodities and consumer goods. As far as the Fed is concerned, it has now reached a monetary divide where all roads lead to stagflation.

  24. whipsaw, thanks for the minyanville.com deflationist perspective on stagflation. happily (i’m still alive) i remember the ’70′s and WIN. although similar, this is definitely not the same time period, globalization and an insane debt based american economy clearly points that out.

    there has been a generational memory loss from parents or great grandparents that went through the depression and understood the value of savings, that memory has vaporized, possibly to be repeated.

    nevertheless, the stagflation effect could well be the same. it depends on the emerging economies taking up the slack of our consumption. i’m hard pressed to imagine america contributing anymore MEW (mortgage equity withdraw) funds to the GDP.

    but, the deflationist camp has some interesting points…

  25. Alaskan Pete says:

    What’s on the hive mind? The DONGER. No no, not the guy from 16 Candles (“grandpapa? Hauto-mobile?!) I’m talking about the Taepodong II missile. Even though it crashed impotently into the ocean…up here on the last frontier, we are in the crosshairs. Seriously, the only part of the US within range of the big Donger is Alaska.

    But, we have a shitpot-load of our own Minutemen ICBMs up here somewhere, pointed right at Kim Jung “Mentally” Il’s pointy little head, and China and Russia as well.

    As for the markets, who knows? Hard to see a real inflationary spiral without wages on a sharp uptrend, particularly with existing US consumer debt loads. But given extreme economic growth as well as monetary growth in the world, how can you cool commodities? Will a cooling US housing market have enough effect to counteract the continued growth of the BRIC? Sure, they could overheat and blowup…but in the mean time what does 10% YOY growth in the 3rd? largest economy do to commodities? We keep hearing about the imminent rise of the Chinese consumer as a way to rebalance, but these people are still transitioning from a rural/ag economy and consequently the growth is eating raw materials. They are buying toilets, cement, and lumber, not iPods and cuisinarts.

    Seems that the ‘ol dollar has to decline, but everyone is already taking that bet and eurozone M3 growth running about 8.5%. So meanwhile you want to hold what…yen? At a -4% rate differential? Pffft. Not with BOJ propensity to intervene on sharp moves. Gold? Maybe.

    Peak oil? Hurricanes? Iran, N. Korea? Midterm elections.

    My guess is more of the same…lateral drift with wild and increasing volatility. Continued frenzied M/A activity as cash rich companies look to expand via acquisition.

  26. Guy says:

    I’ve been focusing on your post about Steenbarger’s features of successful traders, especially the first one about “identifying asset class mispricings and trading off those”. Potential imbalances that I’m looking at are whether P/E ratios are cheap or expensive, and whether energy prices are in line with the supply/demand outlook.

    I’m keeping an open mind on the P/E debate. You and others argue that P/E’s are expensive on a historical basis. The other side argues that P/E’s are cheap, given that the quality of earnings is better today than it was during the recent bubble.

    In the near-term, the direction of the market lies partly with hedge funds. Michael Santoli’s article in Barron’s, 7/3, notes that hedge funds have been liquidating, while long-term investors have been buying. He cites sentiment indicators from State Street Research and Robert Shiller, which show that traditional investors are fully invested; and from Robin Carpenter, which show that hedge fund’s equity exposure has decreased. These trends support the view that any upside move will be limited.

    The other imbalance is the price of oil. Kudlow notes that inventory is high, while U.S. demand is slowing. From Kudlow’s blog 6/23:

    “Crude oil supplies in the U.S. are now at their highest level since May 29, 1998, when oil was trading around fifteen bucks a barrel. In addition, Canadian inventories are also fully stocked.

    Oil tanker executives have recently confirmed that oil in storage aboard very large crude carriers, floating on the high seas, is abnormally high. And, Chevron CEO David O’Reilly informed us recently that gasoline and energy demands here in the U.S. have flattened out, and may be showing signs of declining somewhat.”

    On the other hand, T. Boone Pickens was on CNBC today and predicted that we’d see $80 oil by the end of the year. CNBC also reported that hedge fund flows into energy funds increased for the first time in 12 months. (Someone should ask Hillary if she’s been trading oil futures. She might be bidding up the price of oil in order to undermine Bush’s approval ratings.)

    I think the hedge funds will push up the price of oil through the summer. I currently own VLO, UPL, and SWN. At some point, rising inventories force the price down, possibly towards the end of summer.

  27. alaskan pete,
    nice points! a rural/ag economy is nothing like our cheap plastic and HDTV lusting market. a temporal economic consumption disconnect is quite likely, especially considering the saving ratio of the BRIC.

    the hive mind loves gold and the almost genetic memory of it’s value.

    central banks and oil producing states love the dollar, hate gold and are apparently only mildly concerned with excess liquidity and extreme fractional reserve derivatives.

    yep, short term is “lateral drift and volatility…M/A activity”, until some form of rebalancing occurs.

  28. kensen says:

    This discussion is very interesting, but is it a waste of time? On my deathbed, will I be thinking, if only my portfolio was up 12% a year instead of a measly 7%?

    Do superior investment returns produce happiness?

  29. toddZ says:

    I just sold a bunch of my physical gold holdings. I do see a long term gold bull market, but I believe commodities are FAR from correcting. Gold and copper bounced back WAY too fast.

    My GM short position got KILLED by Kirk Kerkorian last week, but I still think this will be a great trade. No one is buying SUVs with gas prices at $3/gallon. If GM was rolling out a ton of hybrids or (at the least) some fuel efficient cars I would be covering. Instead they’re thinking about the Camaro?!

    BTW, the 2008 Dodge Challenger looks fucking AWESOME!

    On the technical tip, the NASDAQ looks like big time trouble. The 50dma crossed the 200dma a few days ago and the latest rally stalled right at the 50dma. That’s big time bear market action.

    If there is going to be a second leg down, it should be in the next few trading days. I’m 50% short, 50% cash.

  30. STS says:

    kensen:

    No you won’t die wishing for a higher average yield, but you just might reflect that you enjoyed your investing hobby and it did okay for the kids, etc. all a matter of maintaining some balance.

    happy trading!

  31. august says:

    kensen:

    I agree about GM. But, fortunately, I did the same as you AFTER K.K.’s announcement. A plus in the same line of thought is that Ghosn cannot oust R.W. & that, even if it happens, Ghosn’s megalo-ego will ruin Renault, Nissan and GM.

    Six months ago I thought M&A would hit the tar Sands in Canada. I bought Husky, Western Oil Sands, Canadian Oil Sand, Canadian Natural Resources, Suncor… What do you guys think?

  32. alan says:

    toddZ:

    If the housing market continues to collapse, I think it will take all the commmodities, including oil, down with it. However, I read that Fannie Mae and Freddie Mac are lowering the standards for their loans. As far as SUVs, their owners are tinkering with them to make them more fuel efficient according to Jay Leno. Yeah, “they’re buying Toyota Camrys and attaching them to their SUVs”.

  33. BettinaZ says:

    Everyone should RUN to read last Sunday’s NY Times magazine cover article about cars in China. $100 oil? Also, the latest Vanity Fair has an article about the prewar Iraq intelligence, complete with a trail to Italy in 1999– about the time of the neocons’ New American Century Plan. In other words, this was all planned and the wheels started rolling before Dumbo took office.

    And Ken Lay? An obvious suicide with another coverup. Some things never change.

  34. BettinaZ says:

    P.S. I really must find a new nickname for W. It does a sweet, large-eared elephant a real disservice.

  35. me2200 says:

    M&A will hit the oil industry, but not the tarsands companies. Look for smaller oil and gas, mostly oil companies to be purchased by larger players looking to replace declining reserves. That is why I am in Talisman and Devon.

    Oil and gas is where it is at right now. P/Es at 9x and tons of free cash flow in the industry.

    Re: NY Times article on cars in China… what did it say ? Skyrocketing demand for oil ?

  36. Matt says:

    Want the perspective of an average homeowner in the Midwest? I bought a house in 2001 at a high rate, then in 2002 got a 5-year ARM and saved a bunch. Soon that ARM will expire and I’ll end up refinancing at the rate I originally had in 2001. Oh well, it was an easy five years.

    I see an economic inconvenience with refinancing but hardly a CRASH. The people who will be most affected by rising rates are the irresponsible ones who would have defaulted eventually anyway.

    So what do rising rates mean to me? I won’t be ordering leather on the minivan I’m buying next year. Oh, the pain! The sacrifice! Yeah, right. An inconvenience, but ultimately not THAT big a deal.

  37. jkw says:

    The people who will be most affected by rising rates are the irresponsible ones who would have defaulted eventually anyway.

    The housing bubble is the result of these people being allowed to buy houses in the first place. Where do you think record high homeownership came from? Increasing wages? Lower house prices? It was all about lowering lending standards until people who can’t afford a house buy one anyway. If you assume that the same percentage of people can afford a house as before, 3% of the population will be defaulting in the next few years. Given higher house prices relative to wages, it will probably be more like 5-7% defaulting. What do you think 5 million foreclosures over the next 3 years will do to the housing market?

  38. me2200 says:

    Copper approaching $3.50 a pound. Silver up. Gold up. Oil up. Stronger jobs reported. Housing sales not falling as much as forecast.

    Bernanke really needed to raise by 50 bps to get this stuff under control.

  39. ~ Nona says:

    In addition to lowering lending standards, jkw, mortgages are also sold by the original lenders. And resold. I’m reminded of that game from my childhood called “musical chairs”.

  40. mcmg says:

    Rates: Bernanke seems to be caught between a rock and a hard place. Like turning up the gas on the stove to get the pot to boil but not overflow, he will keep going in quarter point moves until he thinks he has it
    right. I think the fed is not done yet.

    Real Estate: Prices have been increased year over year for a few years now and affordability at the starter home stage seems really strained to me. If you have owned for a while now, you are o.k. with some equity built up, but what about bringing in the “new blood”, the people who will buy from you, and start to gain equity themselves? Will our children buy our homes? Will they be able to?

    Energy: There seems to be a huge global demand right now for energy and energy services of all kinds. Didn’t some say last year that oil would be around 40 -50 a barrel right now? Long term,energy is going up.

    Earnings: Earnings have been good for how many quarters now? Thirteen? more? Lets see if the good times keep on rolling.

    Technicals: They seem bearish to me, with a choppy,
    volatile bent. Look for more of the same through this summer.

  41. Cherry says:

    me2200, “sales” are at this stage, revised downward at just about every “revision”, look at inventory and efficiency instead, not good, not good at all. Job numbers rarely are ever “good” during this expansion.

    Housing is going to start depreciating national Q3, fall quickly between Q4 2006 Q1 2007 then drift downward to 2008 when we hit the bottom. Then the slow march upward…………….

    It is a done deal.