WSJ: Sales of new homes rose in February for the first time in seven months, the Commerce Department reported Wednesday, another sign that the housing market is thawing

Bloomberg: Purchases of new homes in the U.S. unexpectedly rose in February from a record low as plummeting prices and cheaper mortgage rates lured some buyers. Sales increased 4.7 percent to an annual pace of 337,000 . . .

Marketwatch: The U.S. housing sector continues to see signs of improvement. The latest government data showed new home sales climbed in February for the first time in seven months, sending shares of home-building companies soaring.


A parade of the mathematically innumerate business writers (and even worse headline writers!) continue to misread data. The latest evidence? New Home Sales.

After incorrectly reporting the Existing Home Sales, the mainstream media misread the Census department report of New Homes.

No, New Home Sales data did not improve. In fact, they were not only not positive, they were actually horrific. The year over year number was a terrible down 41%.  Sales from this same period a year ago have nearly been halved.

Why did the media report this as positive? If you only read the headline number, you saw a positive datapoint: February was plus 4.7% over January.

To get the the facts, you need to read below the headline. In the present case, it wasn’t the seasonality factor that was confusing, it was the “90-percent confidence intervals” — or as it is more commonly known, the margin of error.

From the Census Bureau:

Sales of new one-family houses in February 2009 were at a seasonally adjusted annual rate of 337,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 4.7 percent (±18.3%)* above the revised January rate of 322,000, but is 41.1 percent (±7.9%) below the February 2008 estimate of 572,000.

The median sales price of new houses sold in February 2009 was $200,900; the average sales price was $251,000. The seasonally adjusted estimate of new houses for sale at the end of February was 330,000. This represents a supply of 12.2 months at the current sales rate.

Note that the month over month data at 4.7% — plus or minus 18.3% — is statistically insignificant. (i.e., meaningless). The reported data does not inform us if sales improved month-over-month or not. It is a range, from down -13.6% to plus 23%. Since “zero” is part of that range, we can draw no conclusion. As the Census Department itself notes, “the change is not statistically significant; that is, it is uncertain whether there was an increase or decrease.”

The data does however, tell us that the year-over-year sales fell 41.1% plus or minus 7.9% gives us a range of -49% to -33.2%. The entire range is negative, therefore we can conclude sales fell year-over-year.

These are facts. This is data. This is how you interpret it. Most of the MSM reports (WSJ, Marketwatch, Bloomberg) were simply wrong.

Not nuanced, not shaded, but 2+2=5 wrong.

Let me remind that many of these folks incorrectly misinformed you that Housing wasn’t getting worse in 2006, 2007 and 2008 — just as Home sales and prices went into an historic freefall. Now, these same folks are misinforming you that Housing has turned around and is improving. That is simply unsupported by the data.

(And don’t even ask about television — they simply read the wrong news. Here is a life lesson for you: Never believe news people who read teleprompters. They have no idea what they are doing, they are reading what someone else wrote. When it comes to data interpretation, they are quite literally clueless. Rely on news readers to your personal financial detriment).

The bottom line: Learn to interpret data correctly. Avoid using the people who cannot do so as primary news sources.


New Home Sales Annual Sales Rate, Seasonal Adjusted

Chart via Census Department


A Closer Look at New Home Sales Data (October 2006)

April New Home Sales – Revisited (November 2005)

New Home Sales Fall 42% (May 2008)


New-Home Sales Rise 4.7%
WSJ, MARCH 26, 2009

New-Home Sales in U.S. Rose 4.7% to a 337,000 Pace
Shobhana Chandra
Bloomberg, March 25 2009

Home-builder shares jump as February new home sales increase
Dawn Wotapka
Marketwatch, March 25, 2009

Unexpected Increase in Factory Orders
NYT, March 25, 2009

The New York Times came closest to getting it right

“In another report, the government said that new single-family home sales rose 4.7 percent in February, but that it was still the second-worst month on record, and was down more than 40 percent from February a year ago.”

Category: Data Analysis, Economy, Financial Press, Real Estate

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.

67 Responses to “New Home Sales Fell 41% in February 2009”

  1. Marcus Aurelius says:

    Had lunch yesterday with a group of out-of-work and under employed new-home developers (project management level)/brokers/sales people. The only person seeing an uptrend was a salesman specializing in REO properties (had and sold only one non-REO listing in the past 6 months).

    The knives are still falling.

  2. Dan C says:

    Wow, great work

  3. tagyoureit says:

    Is MSM’s primary objective to sell its content or is it to inform the public? For better or worse, I think it is the former. If we get good information, wonderful. If not, then it’s on us to find the truth. Thank you BR for highlighting another point of view.

    I distrust the president in general based on past experience of his predecessors. Same for our representitives. I hope Obama changes my opinion. My family is counting on it.

  4. Thanks Barry…I was waiting on this one from you. All these outlets posting such cheerful explanations of these numbers can only give one pause to wonder why? Would the world not be much easier to understand if the “journalists” confined their opinions to the editorial pages?

    And even if the numbers showed an increase, would that be necessarily a good thing? Especially when a reasonable person might consider that the apparent imbalance between supply and demand means that what is most needed is a contraction in supply and price?

    In any event, in the residential real estate market, with the government coming out with practically a new economic policy per day (e.g., the foreclosure plan; the MBS purchase plan, etc.), how can the statistics be interpreted intelligently relative to prior periods when such plans were not in place or pondered?

    Example: I just did a refi-closing for a guy that had just bought his house last August. He used an almost-no-money down FHA loan for the purchase, and got a $7,500 tax credit as well. He asked whether his refinance would affect the tax credit. I told him I had no idea. It was the government, and they are very unpredictable these days. But I also told him that everything about his house and this refinance had the government’s imprimateur on it…from his interest rate bought down w/ fed’s purchases of MBS’s, to the fact he was getting another FHA loan, to the tax credit he received in the beginning.

    He sorta looked dumbfounded and told me that, “Yeah, I think the government is trying to do too much.” I had to suppress the urge to roll in the floor laughing…

  5. Paul Jones says:

    Tractor production exceeds quota again.

  6. dhukka says:

    Yep, as usual the media monkeys got it wrong, it was actually the worst February for New Home Sales since data collection started in 1963

  7. cttfinder says:

    Interesting piece and some fair points but you didn’t examine how this decline compares with previous ones. This piece (from prior month) does that (and agrees with you about much of the financial media):


    BR: You are raising an entirely different issue.

    Look out your window and tell me if its rainy or sunny. I don’t care if its hotter or colder or wetter or dryer than last year, I just want to know if I need an umbrella.

    The reference you made was comparative; This is more basic. I am looking at 1st run data, and then reporting it correctly. Beyond that, there are many other things you can do — compare it to different metrics, versus other data points, against prior cycles, etc. That would be more individual research and/or analysis.

    I am hoping the media can report the basic data correctly — which they did not do.

  8. jrnbj says:

    ARRRGHHH… I read this, NPR reports the “rise” verbatim…..

  9. TheUnrepentantGunner says:

    Note if this is a double post i apologize. Internet crapped out.

    Had a revelation today that hit me later than it hit most of you I am sure. I was watching one of the morning shows on the big 3 networks this morning. It ran the housing report (innumerate) style and had experts saying this was the time to buy because of low mortage rates tax rebates and the whatnot. They were saying things had bottomed. I ended up half yelling at the TV well in earshot of my woman something along the lines of “No they ****ing havent you ****ng tards!”

    That wasn’t the revelation. As someone who watches economics we all know that the morning shows get the story wrong. My cynicism grew when I saw a NAR commercial while butchering my shirt with an iron.

    However as I was ready to walk out the door, my “Aha!” moment hit me. I wanted to change the channel but was talked out of it. There was a piece on “which over the counter, generic medications” are best?

    I may have gotten the gist wrong. I didn’t stick around for the report. They had an “expert” on. I thought to myself , “if this expert is as crooked and/or stupid as the so-called housing report, i should buy the product they aren’t endorsing”

    I almost turned around to watch the report to note what not to buy, but I thought I’d listen to the In Rainbows album and chill on my commute.

    The “aha” moment, is of course, that we as a society have fewer generalists and more specialists than ever. But if the specialists in our own field are either bought or just dumb, what stops big pharma from doing the same with medicines, or ADM with diets or whatnot. Anyway, it’s all a bit depressing. I can look at data with my own eyes as well as anyone and draw the relevant conclusions when it comes to economics. When it comes to things like my health or the best way to remodel a house, I am sadly clueless, and more suspicious of experts than ever.

    Not saying any of this is unique, and in fact I am probably slow on the uptake, but just glad to have gotten there.

  10. batmando says:

    @Paul Jones at 9:57 am

    Tractor production exceeds quota again.



    MSMNPR too sad

  11. edhopper says:

    You would think that after the drubbing the Financial News outlets have gotten recently (especially the CNBC/John Stewart takedown) that they might do their job and report the facts and stop being shills. I guess not.

  12. VennData says:

    Another explanation: they’re home-schooled… with a graduate degree in Creationism from one of those top-flight academic institutions where education comes first: Texas.

  13. Greg0658 says:

    Like to see what the definition of “NEW” is.

    Marcus hit on my gut feeling on the 337,000 number. I haven’t seen the bubble fill-in submission form .. I’m guessing this number of NEW homes sold have been completely built / sitting / waiting for prices and buyers for some time. Would you like to know if the NEW home sold has been sitting for 2 years? I would. Further as a former construction worker – my minds eye does not consider a never lived in 2 year old home as NEW.

  14. Avl Dao says:

    C’mon…NPR has been behind the curve and guilty of teleprompter-reporting for the duration of this whole financial crisis. And I support public radio; I also recognize that many NPR regulars were out of their depth yet also remained beholden to dumbing-down the story into their formulaic and simplistic ‘villains and victims’ narratives. This caused them to fumble financial news events where all participants (creditor, borrower, insurer, regulator) shared varying levels of culpability…which just happens to be about 90% of the story in the crash of real estate, bursting of debt bubbles, deflation, and debt unwind. Yes, Madoff and AIG neatly fit into simplistic villain-stories, but most news did not.

    That aside, in the bigger picture, are we surprise that this is unfolding into an ‘Economic Culling’ where folks and institutions weak on financial judgment and/or skills are not physically ‘culled’ (killed) but rather left economically culled (broke). Applies to Iceland, UK, Bear Stearns, WaMu, C, GM, Madoff clients, and condo flippers. All culled.

  15. tagyoureit:
    It is obvious that the media has been told(or just knows) to put the most positive spin on the data. If this February was worse than last, but sales are higher then the previous month, just say sales are higher. It doesn’t matter whether they reported it that way last month. They are not in the business of being consistent. Who will ever call them on it?


    BR: This is less nefarious — its simple math ignorance

  16. Marcus Aurelius says:


    These folks developed communities for some of the biggest names in the business. Inventory is not liquidating, but communities (are these really “communities”?) are being completed and new ground is still being broken. This ain’t over, by a long shot.

  17. rktbrkr says:

    A great blogging by Chris Martenson PHD – 3 main points about new home sales:
    1)New home sales almost always increase from Jan to Feb, 6 of 7 recent years and the 7th might be an error
    2) Cancellations run at 30-50% of the reported numbers
    3) The statistical gray zone mentioned by Barry

    So people read the headlines and buy homebuilder stocks while sales are down 40% year over year and prices are down 20% YOY. Soooo, you can cut homebuilder revenues in half for 1Q 09.

    IMO the real driver going forward is what happens to all home prices when foreclosures come out of their voluntary moritoria.


    BR: I have his DVD but havent seen it yet

  18. My only reasons for staying at least minimally aware of what the Main Stream Media is saying, is to give my clients an intelligent translation of its messages and to know what the herd is consuming.

    If I had no fiduciary responsibility to others, I would not consume one piece of MSM sensationalism. At least they are predictable and their motives are quite transparent. The large problem, however, is that MSM motives and collective lack of expertise are not apparent to the herd, which gives MSM power to shape the herd’ s perception.

    When there is a fire, it is neither prudent to say, “All is well” — nor is it prudent to scream, “Fire!” MSM does this, though, and gets paid for it.

    “There is no truth. There is only perception.” Gustave Flaubert

    “I do not take a single newspaper, nor read one a month, and I feel myself infinitely the happier for it.” ~ Thomas Jefferson

  19. franklin411 says:

    Kent and Barry:

    Apparently, neither of you read the Washington Post. Sorry to burst your bubble, but this is yesterday’s news and the MSM got it 100% right:

    New Home Sales Jump 4.7 Percent in February
    By Renae Merle
    Washington Post Staff Writer
    Wednesday, March 25, 2009; 10:40 AM

    New homes sales unexpectedly jumped 4.7 percent in February, but prices continue to tumble as buyers make their way through a huge backlog of unsold homes.

    Sales of new single-family homes reached an seasonally adjusted annual rate of 337,000 in February, according to the Commerce Department data. Analysts had expected sales to continue to fall. That figure is down 41 percent from the same period a year ago.


    BR: No, new home sales did not jump 4.7%. THATS THE POINT! Given the margin of error of 18% we dont know what they did, capiche?

    Also, the NYT (as noted above) got it mostly right.

  20. Bruce N Tennessee says:


    You can’t still have this confused. Housing sales may even pick up a little into summer…have you not seen the excellent sine-wave pattern housing charts that CR posts and that Barry uses?

    The only comparison is Y to Y….

  21. mikesic says:

    i view this as good news. the less homes being made the faster the excess supply disappears. less new mcmansions the better.

  22. call me ahab says:

    @ Franklin-

    I think what your missing Franklin is that home sale are always higher in February than January so can it really be unexpected? What if the Headline read:


    Wow- that sure seems more ominous.

  23. HCF says:

    > February was plus 4.7% over January

    Next thing they’ll tell us that gift sales in December are higher than in November. Shocking!


  24. Mannwich says:

    Exactly, ahab. I guarantee almost no home sales take place here in the North Pole in January. They always tick up quite bit in the spring/early summer. That’s the real selling season here, even more so than other locaitons. The telling signal here will be right now and I actually haven’t seen many homes in my neighborhood (an old neighborhood in Mpls) on the market yet. Not sure if that’s a good or bad sign (or indicative of anything). The ones that are on the market, however, have been there languishing for months/year+. Admittedly, homes have frequently sold here in this neighborhood over the past year or two quite well though (anecdotally, based on my eyeing “sold” signs) and prices seem to have held up better than the newer burbs’ McMansions. Much better, in fact. I attribute a lot of that that to the age and desirable location of the neighborhood.

  25. batmando says:

    @ Avl Dao at 10:17 am

    “C’mon…NPR has been behind the curve and guilty of teleprompter-reporting for the duration of this whole financial crisis.”

    What I meant above by “MSMNPR too sad.” They have had a couple of “specials” (This American Life) that have been relatively comprehensive, but still catch-up pieces. If the NPR economic reporters would just touch base with TBP occasionally they might at least get a heads-up and turn their noses into the prevailing wind.

  26. franklin411 says:

    The WaPo article says:

    “That figure is down 41 percent from the same period a year ago.”

    Just because they chose to emphasize the month-over-month figure in the headline doesn’t mean the article is wrong. You stress the year-over-year, you stress the month-over-month. That’s an honest disagreement, akin to “tomayto vs tomahto.”

    Everything has a margin of error. Nobody’s saying this data point proves that we’re in a new golden era, but when was the last time we had an uptick in anything? That’s all I see it as, and I’m happy to have it.


    BR: 18% margin of error.
    Reported change 4.6%
    Actual change UNKNOWN

    Thats the issue — WaPo like the NYT handled it better than most.

    But they and their headline were wrong, end of story.

  27. Mannwich says:

    @franklin411: Actually, no. When comparing data in an honest empirical manner, one must compare apples-to-apples (Feb to Feb year over year) not apples-to-oranges. Focusing on the apples-to-orange piece more is disengenuous at best.

  28. cjcpa says:

    Franklin, you are missing this:

    BR: “If you only read the headline number, you saw a positive datapoint: February was plus 4.7% over January.

    To get the the facts, you need to read below the headline.”

    The headline is wrong. Do not confuse the presence of facts in the story for a good headline. The post states that the headline is wrong. Your posted article confirms this.

    New Home Sales Jump 4.7 Percent in February
    By Renae Merle
    Washington Post Staff Writer
    Wednesday, March 25, 2009; 10:40 AM

    New homes sales unexpectedly jumped 4.7 percent in February, but prices continue to tumble as buyers make their way through a huge backlog of unsold homes.

    You are confirming the complaint in the post while seeming to present a contradiction.
    Read the Headline again. It’s misleading.
    That’s the point.
    - and not that they managed to print some truth somewhere in the article. /hardly commendable/


  29. KidDynamite says:

    barry –

    how was Jan 2009 vs Jan 2008? in other words, is the -41% Feb year over year number an improvement from the January year over year change?

    and would it even matter if it was? i’m not sure…

  30. joro says:

    Is the Feb to Feb showing improvement over Jan to Jan is the real issue. We aren’t going to see a positive year over year comparison any time soon. Are we trending towards that though? Is the decline decelarating? I have no idea from either piece, BR or the NAR.

  31. batmando says:

    The only valid comparison M-o-M would be the % increase/decrease from January to February this year vs last year and against the average January to February % inc/dec.
    If the average February over January increase is 4.7% (or higher), there is no jump in sales, just the usual seasonal M-o-M rise.

  32. franklin411 says:

    @cjc, I see what you’re saying but I think BR is making a mountain out of a molehill. It’s a popular molehill: people always like the idea that the powers that be are tricking everyone but them. The glass-half-full crowd will be angry if you report that sales dropped 41% yoy, and the glass half empty crowd will be angry if you report that sales rose 4.7% mom.

    BR is trying to make a bigger point about the media, and I think it’s a false assertion. Let’s take a look at the first line of the housing article in various news outlets:

    New homes sales unexpectedly jumped 4.7 percent in February, but prices continue to tumble as buyers make their way through a huge backlog of unsold homes.

    Sales of new homes rose in February for the first time in seven months, the Commerce Department reported Wednesday, another sign that the housing market is thawing.

    New home sales rebounded unexpectedly last month, but were still the second-worst on record and remained well below last year’s levels, according to data released Wednesday.

    Sales of newly built U.S. single-family homes unexpectedly rose at their fastest pace in 10 months in February, while prices fell by a record margin from a year ago, a government report showed on Wednesday.

    SF Chronicle
    Good news from the U.S. Commerce Department: New home sales experienced an unexpected 4.7 percent jolt in February; approximately 337,000 units sold during the month, topping analysts’ expectations for 300,000 sales.

    Salt Lake Tribune
    Glimmers of hope for the economy — better home sales and higher demand for big-ticket goods, plus optimism from the White House and a nearly 20 percent rally in stocks — have some people wondering if the worst is over.

    Philly Inquirer
    A run of encouraging economic reports may mean the worst, panic-inducing stage of the economic downturn is over. Emphasis on the word may.

    I don’t see a whole lot of Pollyanna-ism here.


    BR: You’ve made my point for me — every single one of these is wrong.
    2+2 is not 5, no matter what else you say.

  33. Stuart says:

    I question if this is simple math ignorance or if there is something more to it. Once, twice, three..times a lady… sorry off tangent there…. certainly, a few times I could see as an error, but such consistent erroneous reporting, no, sorry, don’t buy it. This is an issue worthy of detail examination as we see it ALL THE TIME. I cannot chalk it up to simple laziness or mathophobic reporting.

  34. Please…

    the 4.7% number is statistically INSIGNIFICANT. It has, as BR pointed out, an error range of +/- 18.3%. It tells us NOTHING about February relative to January, yet it was the number used to claim sales were “up”, in all these outlets (including WAPO), and even the New York Times, who otherwise understood the reality better than the rest.

  35. FromLori says:

    I am so glad I started following your blog! I commend you for getting the facts out and allowing others who appear to be very knowledgeable weigh in with great information. Thank YOU!

    Karl Denninger also had a very good article about this…

    Posted by Karl Denninger in Macro Economics at 10:28
    Existing Home Sales: Beware
    Beware the so-called “improving” existing home sales numbers:

    March 23 (Bloomberg) — U.S. Sales of previously owned homes unexpectedly climbed in February as record foreclosures brought bargain hunters into the market to take advantage of lower prices.

    Supply hasn’t changed, however, at 9.7 months, and more troubling is this:

    The median listing price rose in California last month for the first time in three years, said Lawrence Yun, the real- estate agents group’s chief economist.

    Mr. Mortgage has been all over this (Mark); his web site is down at the moment, however, I as understand he is moving. (You can google him and get on his email list, which I am.) The short form of the explanation for the rising prices in California in terms of “average resale” is extremely bad; foreclosures are now moving “up-market” – that is, having cleaned out all the “Starter Homes” we’re now seeing the middle-market and higher homes go into foreclosure and as a consequence this “improvement” is actually a marker for severe distress in the broader economy in California.

    Contrary to initial appearance this isn’t “good” for the housing market, its bad! When the $200,000 houses are getting foreclosed it’s “more or less ordinary Americans” getting nailed – when its the $1 million houses that’s the executives and other “nouveau riche” types, and along with the house will go to the BMWs and Hummers.

    This data produced a really nice pop in the markets when it was released; I don’t expect the media to “get it”, but there are some of us out here in the Blogosphere, including Mr. Mortgage and myself, who will read beyond the headlines and actually put forward something passing as “analysis”!

  36. Terry says:

    The unfortunate thing is that investors, especially retail investors, too often make investments on these misleading headline figures. Apparently, however, given the early move in the markets yesterday, even institutional investors and traders were drinking the kool-aid.

    It all only promises a greater stumble when the markets wake up to their error.

  37. Transor Z says:

    December sales of Christmas cards up 80%

  38. Kyle says:

    “Never believe news people who read teleprompters.”

    Haha, thank you for saying what I’ve been commiserating about my whole life. I haven’t watched TV news since I was 10 years old. They have nothing to say you can’t find out about more efficiently in written form. It’s a multi-billion dollar industry based on people too lazy to read. The only purpose it has it showing videos of things that are hard to describe in words. Why do TV reporters get such good access to the White House when all they ever do is offer a 1.5 minute spoken analysis of the day’s events? John Oliver’s press corps adventure was awesome.

  39. And retail sales of whole turkeys were up in November a whopping 200% over October, but fell by about 50% in December, and very nearly completely disappeared in January.

    It’s understood that President Obama’s representatives are negotiating a relief package, which is likely to include a public-private partnership to purchase birds grown sickly and old, attempting to find a market price at which the flock will clear, with minimal risk to the taxpayers.

  40. JustinTheSkeptic says:

    Why the hell are the politicians on the television screen every time I turn it on? Talk abou trying to massage a market. The people that are Long and in the “know,” are using every red herring, canard, they can find to prop this market up artificially. The people that are Short and in the “know,” know better. It won’t work.

  41. Mannwich says:

    A bit off-topic but South Park’s episode on the economy last night was priceless. A bit crude and politically incorrect, but priceless indeed.

  42. call me ahab says:

    Mannwich Says:

    “A bit crude and politically incorrect”

    exactly the way I like it

  43. Mannwich says:

    @ahab: Precisely. Nothing is sacred on that show, right, left, middle. Brilliant.

  44. Greg0658 says:

    mikesic Says: “I view this as good news. the less homes being made the faster the excess supply disappears. less new mcmansions the better.”

    Agree with you (and Marcus) your statement opened this common knowledge thought I’ll pass on … home lot developments or single lots when initiated or acquired by a developer have money tied up in them. Additionally home builders with roots in the community can be (must be) activated into building the starts .. to provide cash flow to the community they are embedded in .. or more important to a local bank to maintain the solvency of a preferred account holder. This is a primary reason imo for this whole mess .. replacement of cash flow for lost manufacturing at all levels in America.

  45. bernandoo says:

    @mannwich: that episode was priceless:

  46. Greg0658 says:

    The Curmudgeon @ 11:52 am .. retail sales of whole turkeys :-) lol

  47. hr says:

    “Never believe news people who read teleprompters.”

    Correction for BR:
    “Never believe ANYONE who reads teleprompters.”

  48. franklin411 says:

    There’s a word for people who never need a prompt (and typed notes are just as much of a prompt as a teleprompter):


  49. tsmwebb says:

    Yes, NPR’s money reporting has sucked but I don’t think they got this one all that wrong. NPR reported:

    [quote]Pat Newport, a housing economist at IHS Global Insight, urged caution when looking at the figures. He said the latest reports are coming after steep, weather-related declines in January — and they’re still the second-worst reports on record. New-home sales are down 40 percent from a year ago, and prices are down 18 percent.

    “The housing numbers that are coming out, they were still horrible numbers,” said Newport.

    But with mortgage loans tight, the median sales price fell to $209,000 — down a record 18.1 percent in February from a year ago. …[/quote]

    Even the “Rise Unexpectedly” headline is supported by:

    [quote]Economists surveyed by Thomson Reuters had expected February sales to fall to a pace of 300,000 units.[/quote]


  50. flipspiceland says:

    Stopped listening to the news in 1960 when I just learned how to talk.

  51. The Curmudgeon Says: March 26th, 2009 at 11:52 am

    And retail sales of whole turkeys were up in November a whopping 200% over October, but fell by about 50% in December, and very nearly completely disappeared in January.

    It’s clear you’re never going to make it in the news biz. What you should have written:

    And retail sales of whole turkeys were up in November a whopping 200% over October, however for December and January year over year sales remained flat to slightly up.

    You see, you need to learn to switch when the switch benefits you and switch back if necessary. Like in 1984 you have to be ready to hate a different enemy in mid sentence:

    Excerpt from Ch. 17 of 1984:

    On the sixth day of Hate Week, after the processions, the speeches, the shouting, the singing, the banners, the posters, the films, the waxworks, the rolling of drums and squealing of trumpets, the tramp of marching feet, the grinding of the caterpillars of tanks, the roar of massed planes, the booming of guns – after six days of this, when the great orgasm was quivering to its climax and the general hatred of Eurasia had boiled up into such delirium that if the crowd could have got their hands on the 2,000 Eurasian war-criminals who were to be publicly hanged on the last day of the proceedings, they would unquestionably have torn them to pieces – at just this moment it had been announced that Oceania was not after all at war with Eurasia. Oceania was at war with Eastasia. Eurasia was an ally.

    There was, of course, no admission that any change had taken place. Merely it became known, with extreme suddenness and everywhere at once, that Eastasia and not Eurasia was the enemy. Winston was taking part in a demonstration in one of the central London squares at the moment when it happened. It was night, and the white faces and the scarlet banners were luridly floodlit. The square was packed with several thousand people, including a block of about a thousand schoolchildren in the uniform of the Spies. On a scarlet-draped platform an orator of the Inner Party, a small lean man with disproportionately long arms and a large bald skull over which a few lank locks straggled, was haranguing the crowd. A little Rumpelstiltskin figure, contorted with hatred, he gripped the neck of the microphone with one hand while the other, enormous at the end of a bony arm, clawed the air menacingly above his head. His voice, made metallic by the amplifiers, boomed forth an endless catalogue of atrocities, massacres, deportations, lootings, rapings, torture of prisoners, bombing of civilians, lying propaganda, unjust aggressions, broken treaties. It was almost impossible to listen to him without being first convinced and then maddened. At every few moments the fury of the crowd boiled over and the voice of the speaker was drowned by a wild beast-like roaring that rose uncontrollably from thousands of throats. The most savage yells of all came from the schoolchildren. The speech had been proceeding for perhaps twenty minutes when a messenger hurried on to the platform and a scrap of paper was slipped into the speaker’s hand. He unrolled and read it without pausing in his speech. Nothing altered in his voice or manner, or in the content of what he was saying, but suddenly the names were different. Without words said, a wave of understanding rippled through the crowd. Oceania was at war with Eastasia! The next moment there was a tremendous commotion. The banners and posters with which the square was decorated were all wrong! Quite half of them had the wrong faces on them. It was sabotage ! The agents of Goldstein had been at work ! There was a riotous interlude while posters were ripped from the walls, banners torn to shreds and trampled underfoot. The Spies performed prodigies of activity in clambering over the rooftops and cutting the streamers that fluttered from the chimneys. But within two or three minutes it was all over. The orator, still gripping the neck of the microphone, his shoulders hunched forward, his free hand clawing at the air, had gone straight on with his speech. One minute more, and the feral roars of rage were again bursting from the crowd. The Hate continued exactly as before, except that the target had been changed.

    The thing that impressed Winston in looking back was that the speaker had switched from one line to the other actually in midsentence, not only without a pause, but without even breaking the syntax.

    God forbid we are heading into this type of world

    I think we would have had we not had the internet and people like Barry

  52. wally says:

    “Not nuanced, not shaded, but 2+2=5 wrong.”

    There is an old joke among mathematicians:

    2+2=5 for large enough values of 2.

  53. WaveCatcher says:

    BR, this is representative of your finest work, what drew me to your blog and keeps me coming back.

    This is the type of analysis we pay you so richly for!

  54. cttfinder says:


    Now, you’ve missed the point from the link.

    Seeing that it’s raining is useless information. [BR: Not if you don’t want to get wet and need to know whether to carry an umbrella or not] Scary headlines about huge percentage year over year changes are like knowing it’s raining. [BR: You are incorrect, it is a factual data point, whether its positive or negative] The question is, is it raining so hard that we’re going to get flooded? Is this rain out of the ordinary. The link clearly shows that these large y-o-y declines in housing are NORMAL in a recession. [BR: that is a very different question — which you cannot get to if your basic math is in error]

    The media made folks believe we’re heading into a depression…if that turns out not to happen, the folks who panicked and sold at Dow 6500 (or sat on their cash) will have been severely burned. [BR: And the people who stayed long from 14,000 all the way to 6500?]

  55. whskyjack says:

    How in the world do you get an 18% sampling error?
    Correct me if I’m wrong it has been a while since the college stat class but that means the real number is anywhere from -13.3% to 22.7 %
    They must mail out the forms and count those that come back. Because the Margin of error is high even on the ones from 3 or 4 years ago. LOL It is a waste of time to even type up the press release.
    I believe that the only thing we can take from this report is that of those returning the form there was a 4.7% increase in new home sales.


  56. cttfinder says:

    BR: And the people who stayed long from 14,000 all the way to 6500?

    Barry – market timing doesn’t work over the long-term. Think you’re smarter than Warren Buffet – he says don’t do it and he practices what he preaches. I bought my first stocks back when the Dow was at 800 – that’s not a typo. So, rather than dwelling on holding from 14K down below 7K, like Warren, I look at being able buy stocks below 7K as a gift from heaven.

    Over ALL your years investing in stocks, can you show us that you’ve done BETTER than buy and hold? I very much doubt it.


    BR: Given up on the New Home Sales? Changing the subject to something else?
    Fine, I’ll play along: Yes, I’ve done dramatically better. And no, you don’t have to market time — all you need is an adequate stop loss system.

    Buy & Hold works wellin Bull Markets. Its devastatingly bad in Bear markets.

    Ask your boy Sir Warren how Buy & Hold is working out. His holdings as of last year (September 30, 2008) were a disaster:

    Moody’s (MCO) down 39%
    Wells Fargo & Company (WFC) down 48%
    American Express Company (AXP) down 56%
    US Bancorp (USB) down 53%
    Bank of America (BAC) down 85%

    (Go update these — They are horrific).

    Look, I am not saying he has not been a terrific investor over his career — he has — but he makes mistakes, including some jumbo money losers.

    Make your own decisions and stop blindly following others.

  57. super_trooper says:

    Bea ready to use the copy and paste buttons. You’ll need them for April and May too. By then ee’ll have “New home sales rose for 3rd months in a row”.
    Anyways, can you go much lower? We’re down by 80% since the peak February of 2005. That’s the good news. Now will it be a V shaped, U-Shaped or L-shaped recovery?

  58. philipat says:

    I’ve commented extensively on this in earlier threads so please excuse any repetition. Part of the problem is the way Maths is tought these days, so that younger generations have no “Feel” for numbers. I see this in my kids, who had the best education at top Universities, but who cannot deal with mental maths. They are amazed when I can do calculations mentally before they can reach a calculator to confirm what I have already said. Not being arrogant, it’s just that those endless hours of competitive quizzes on “Times tables” provided a very strong grounding in numbers upon which to build more sophisticated and intuitive numerical literacy.

    The best way to explain such trends to with this lost generation is to use Moving Annual Total charts. If its up, its up. If its down its down. They can understand that!!

  59. I guess the important question to ask is are those potential buyers moving from new homes to used homes(I really shouldn’t be so lazy and go look it up)? If that is the case then it may be bad for the housing market specifically but not for the US economy in general.

  60. Pat G. says:

    Misread my ass. It’s skewed. Even when it’s pointed out to some airhead on CNBC that the traditional way of comparing numbers is year over year and not month over month the ding-dong makes the same comparison in the next interview. This is all about positive spin as the market’s cheerleaders attempt to make it go higher. It’s working. For now.

  61. Greg0658 says:

    philipat Says: at 6:07 pm “Part of the problem is the way Maths is tought these days, so that younger generations have no “Feel” for numbers”

    I wonder if anyone has an opinion on the slide rule in math along the lines your talking. I was indroduced a bit in 8th grade multi-shop and more in 9th grade Electronics. Then the TI-30 with red LED display came out at about $160 bucks if I remember right. We pretty much switched 100% to the calculator at that point.

  62. some_guy_in_a_cube says:

    Great job calling out them out BR.

    It’s no surprise that America’s Fucked-In-The-Head media is furiously sucking it’s thumb while the whole damn thing is coming apart.

  63. and, for those still playing along..

    “Establishment News Media…
    There is blood on your hands!
    1/2 the Story = 1 Complete Lie.
    Learn How the Broadcast News Media Deceive You!”

    They’re so good at it, it even spawned its own URL:

  64. cttfinder says:

    Where’s the proof of how you’ve done over a long time Barry?
    We can all see Buffet’s long-term track record…where’s yours? How about over the past decade?

    I responding to your changing of the subject when you said:

    BR: And the people who stayed long from 14,000 all the way to 6500?

    THEN, you accused me of changing the subject:

    BR: Given up on the New Home Sales? Changing the subject to something else?
    Fine, I’ll play along: Yes, I’ve done dramatically better. And no, you don’t have to market time — all you need is an adequate stop loss system.

  65. [...] Media Misreports New Home Sales –they didn’t rise, they fell 41% (March 26th, 2009) [...]

  66. [...] Media Misreports New Home Sales –they didn’t rise, they fell 41% (March 26th, 2009) [...]

  67. [...] Media Misreports New Home Sales –they didn’t rise, they fell 41% (March 26th, 2009) [...]