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Sales Of U.s. Existing Homes Unexpectedly Drop In August

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Sept. 24 (Bloomberg) -- Sales of existing U.S. homes unexpectedly fell in August for the first time in four months, signaling the housing recovery will be slow to gain speed.

Purchases dropped 2.7 percent to a 5.1 million annual rate, the second-highest level in the last 23 months, the National Association of Realtors said today in Washington. The median price dropped 12.5 percent from August 2008.

Job losses indicate more Americans may lose their homes, swelling the glut of unsold properties. Even so, the housing recession that crippled the economy is easing as foreclosure- driven price declines, tax credits to first-time buyers and near record-low borrowing costs have helped stabilize demand in recent months.

US stocks down, oil down 4%

Deflation fears resurfacing ?

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Well, you see, consumption and borrowing had reached a very very low level.

So the government solution is stimulus....consumers get: $8000 to buy homes and $4000 to buy cars. Yay!

But, hold on, this is just moving forward consumption from an already low future level, at the cost of taxpayer funds; $43,000 for each $8000 stimulus, and $4000 for....Toyotas....

And the stimulus is extended to....Puerto Rico, Guam, the Virgin Islands....


That brilliant plan worked well, didn't it!

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take your pick

The way stocks/oil/gold just dropped like a stone seems to indicate the recovery/inflation story is very overbought IMO

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Don't extrapolate from US to UK. Some parts of US (Detroit) have reached a real bottom and turned with the artists moving in. But in UK there's a long way still to fall .... even in newbuild city-centre flats.

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