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05/19/2009

Housing Starts Lower - Why is this a surprise to analysts?

http://www.cnbc.com/id/30821477

So what makes someone an "analyst"?

The financial analysts never saw the banking situation coming last September - of course, now they temper that and say all their clients were "out." Sure they were - no one actually lost any cash, right?

So now, real estate analysts are surprised that housing starts dropped significantly in April and so did permits on new construction.

Why would this surprise anyone outside of DC (where when they wish it, it happens and the NYT reports it happened BECAUSE they wished it)?

Who buys a house when they don't have a job? Or even when they are not sure they will have a job next month?

Answer - no one who isn't dealing with FANNIE MAE or Chris Dodd personally.

So inventories climb - meaning prices drop further - nasty old law of supply and demand.

And still no bottom. Of course, stocks are doing well. When will the fleece broom come out again?

Brian

Posted at 10:54 AM |

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