Stocks Hit New Highs (for 2009) After Home Sales

Source: CNBC

Stocks jumped Friday, setting the stage for a four-session winning streak, after a sharp jump in existing-home sales and some encouraging economic data out of Europe.

Existing-home sales surged 7.2 percent to a 5.24 million annual pace, the highest jump since August 2007. Economists had expected a rise of just 2.2 percent. Home sales were up 5 percent year over year. It was the fourth straight month sales have risen.

The Dow was up about 60 points before the report, then shot up to more than 100 points afterward.

All three major indexes — the Dow, S&P and Nasdaq — hit new highs for the year.

Read more: http://www.cnbc.com/id/32508211

;)

the markets are going to completely tank again on the next leg down likely in Q4 or Q1 when the fundamentals don't support this rally.

And that next leg down that is coming has nothing to do with Obama or any other politician. Anyone who thinks so is fool. It is a result of how we as americans have let our nation weaken economically over the past 50 years. We went to producers to mass consumers who produce practically nothing and do this consuming ON CREDIT. It is not sustainable and none of the core issues have been addressed.

When the existing-home supply dwindles, then new home construction must follow. That means an upswing in the construction industry, and more jobs.

You think our economy is going to do a complete turn around based on home construction? Book mark this post I am going to rub it in your face come Q4. I am book marking it, and I promise to call you on it when the next leg down hits.

I'll continue to be an optimist.

I am perfectly happy friend, but I am real about the current economy. Again I will be waving your post around come December....

The "existing home supply" isn't dwindling at all. Do you ever wonder why most of those REO's aren't listed on the MLS? It's the nasty secret of "shadow inventory." The banks are sitting on them to try and prop up prices and, hence, their fantasy book value (forget 'mark to market') until they get pawned off to the taxpayer in the next bailout (maybe the upcoming "PPIP.") But it won't work in the long run because the fundamentals simply aren't there. Wages are stagnant and prices are still too high.

Furthermore, these silly breathless NRA press releases are nothing more than advertising on the part of the real estate industry. "Bottom!! Buy now!!11!!"

The market going up doesn't mean anything because there's nothing to justify it. Unemployment (especially the more realistic U-6) is still crippling. Wages aren't going up. P/E ratios are still unrealistic. But the brokers' front-runners make out quite handsomely on these sucker rallies.

Hidden backlog of foreclosures:
http://globaleconomicanalysis.blogspot.com/2009/08/hidden-backlog-of-foreclosures.html

Existing Home Inventory:
http://www.calculatedriskblog.com/

Inventory is only slightly below last year, but what happens when you add in the foreclosures that aren't happening, because the banks can't recognize the losses without being officially insolvent, even according to the grossly fraudulent rules they already get to operate with?

What you fail to mention is the Commercial Real Estate Bubble, which is the next shoe to drop. Everyone of course is conveniently not talking about that.

Perhaps the Propaganda hasn't covered this subject yet, hence the omission from most cheerleading posts.

No worth moving the market up by any means

U.S. Existing Home Sales Yr/Yr
$0 - $100,000 Up 38.8%
100,000 - $250,000 Up 8.7%
$250,000 - $500,000 Down 6.2%
$500,000 - $750,000 Down 8.9%
$750,000 - $1,000,000 Down 10.6%
$1,000,000 - $2,000,000 Down 23.3%
$2,000,000 + Down 32.4%

http://www.cnbc.com/id/32508736

There are some very revealing facts and figures, and real hard data being posted in this thread. Very good information.

But it is always met with silence by cheerleaders because it completely contradicts the paradigm that they cling to, that is of course constructed around mainstream Propaganda that they want to believe in.

There is never any response to information like this.

And if there is , it's usually mocking, condescending, or angry hostility followed by some form of selective reasoning that equates to "It doesn't exist."

How nice .....

(And I essentially agree with you about the economics ....)

dupe

just put your savings on one of the numbers and spin the wheel. Step right up. A new "investor" is born every minute.

Excuse my sarcasm but how many times do we let Wall Street manipulate bubbles to transfer money from the middle class "investors" to the rich?

It makes them feel good, and they love to feel like they have power, love the feeling of "getting in on something", or a shortcut to possible riches.

They also for the most part so desperately want to believe that they are being told the Truth and this Recession really is over, because they cannot handle the reality that will rear it's ugly head if it isn't. It's much easier just to go along with the lie and believe what "leadership" tells you, than think for yourself, do your own research, and come up with your own conclusions.

Once you do THIS, you have no choice but to come to the realization that all of this is nothing but lies, smoke and mirrors, and well-crafted Propaganda. And many cannot handle this.

The "optimism" most people feel is because they are picking out nuggets of Propaganda, and forming their complete thinking process around it, shutting out and ignoring anything that is contradictory or makes them feel bad.

Even though no real recovery exists, The ILLUSION of recovery does, and they are going with it, because it is holding up due to all the artificial machinations being implemented to sell the Public that it is real.

The Psychology behind the relentless nature of people clinging to this illusion is getting scary. it's becoming more and more obvious this is all patent nonsense, but the more obvious things get, the stronger the Illusion is pushed and Propagandized, and the stronger the Public's belief in this is. The blind faith and selective reasoning is almost childlike. Not much objectivity to be found.

Despite the obvious negative connotations this is going to have for all of us when it all comes down, you cannot help but be sadly fascinated at the level of disconnect going on right now.

You are witnessing something unprecedented in history.

I can only hope that future generations will learn from this period, and not repeat the same mistakes again. I have a dreadful feeling they will have plenty of examples of the consequences of failing to do so to draw from.

We know it's just a bubble, but maybe we can hit it rich on this one.

it would look like a doughnut. With America as the doughnut hole.