13:00 What Happened?

[FTBagain]

Shares started a very steep climb across Europe, and the £ tanked.

Anyone know why?

[2005]

Not a clue but TB was giving a talk at the CBI today at about that time - don't know what he said though.

[London Landlady]

? US durable goods ? better than expected???

[geranium]

Shares started a very steep climb across Europe, and the £ tanked.

Anyone know why?

Strong data on US economy (October durable goods orders), backing the case for US interest rate rises, causing £ to slip a bit?

[stillill]

Not a clue but TB was giving a talk at the CBI today at about that time - don't know what he said though.

Did he get on stage and say "awooga"?

[2005]

Did he get on stage and say "awooga"?

No but he was hassled by some Green Peace activists who managed to get into the building and hold up the conference - apparently they had to move into another room.

[FTBagain]

Strong data on US economy (October durable goods orders), backing the case for US interest rate rises, causing £ to slip a bit?

That would do it. Thanks.

£ fell about 1 cent from its value just before the annoucement.

It has bounced back some, now about 0.6 cent down. Sensitive old soul, ain't it!!

Edited November 29, 2005 by FTBagain

[dogbox]

Strong data on US economy (October durable goods orders), backing the case for US interest rate rises, causing £ to slip a bit?

Dr Bubb said the US economy was in iriversible decline, a fatally wounded leviathan being surplanted by the emerging Eastern superpowers. Mmmmm

Remember my prediction from a while back - FTSE to experience a boom thru 2006 / 7.

Super - growth for Earth plc.

[Duplex]

The yield curve inverted yesterday briefly, and the obvious unsustainability of the American debt economy is sinking in.

As a capitalist, I usually find a visit to the United States invigorating and inspirational. After all, there is no better place to do business. But last week it felt as if trouble was on its way.

It seems clear that the US has experienced a king-sized property bubble which is now deflating. The evidence of danger is obvious. Across the country, house prices have risen by 50 per cent in five years, but in many places, such as California, property inflation has been far greater. Home values are now completely disconnected from any historical relationship with salaries or rents so most first-time buyers are priced out of urban markets. As a nation, the US has always believed in the future and always been run on debt. But it seems that deficits at every level - government and personal - are greater than ever before - and this follows a long period of prosperity. Today, competition from countries such as China and India is ferocious, and yet the US seems ostracised from many countries thanks to its foreign policies since 9/11.

America must reform its healthcare system, and prepare for a housing shock. Even Bill Gates and Warren Buffett believe the dollar will decline owing to excessive imbalances in the system. I have complete confidence in the indomitable ability of America to recover from any setbacks and rise again. But I fear the Land of the Free is in for a period of increased turbulence.

• Luke Johnson is chairman of Channel 4 and a director of Dollar Financial

The Torygraph

[boom_and_bust]

Hi,

Thought I would flip over to reuters breaking news to see if they had anything there. They didn't, but I thought the sterling breaking news link from a.m. was an interesting read.

http://investing.reuters.co.uk/Investing/F...-11_L29520309:1

"I think the market is starting to focus on the U.S. housing market and when it does that it will also turn to the UK housing market as well," said HSBC currency strategist David Bloom.

The earlier flat housing market figures from the Nationwide, which caused the YoY to fall back again, was not well received by currency markets. With the current US inflation levels running close to 4.5% and the Fed worrying it is about to runaway and rates need to go up up up, at a time when US house prices are nearly as stretched as ours' but with crash signs evident and openly talked about on the media services, doesn't look too good for the pound over the coming months. And what is the implication of that? Does it mean Gordon has to keep HPI somewhere near 10% every year to avoid the pound getting smashed into the ground? It's a no win situation. I wonder if George Soros is watching sterling again?

Boomer

Edited November 29, 2005 by boom_and_bust

[Saving For a Space Ship]

No but he was hassled by some Green Peace activists who managed to get into the building and hold up the conference - apparently they had to move into another room.

Probably see this happening in UK then:

'Anti-Terror Law Hits Greenpeace'

http://adbusters.org/blogs/Something_Rotten_in_Denmark.html

"Danish authorities have used a new law — which was supposed to be an anti-terrorism measure — to convict Greenpeace for actions committed by its individual members.

"This is the first time they have applied this law and it is a huge threat to what we can do," said Dan Hindsgaul, spokesperson for Nordic Greenpeace. "

[jp1]

Hi,

Thought I would flip over to reuters breaking news to see if they had anything there. They didn't, but I thought the sterling breaking news link from a.m. was an interesting read.

http://investing.reuters.co.uk/Investing/F...-11_L29520309:1

"I think the market is starting to focus on the U.S. housing market and when it does that it will also turn to the UK housing market as well," said HSBC currency strategist David Bloom.

The earlier flat housing market figures from the Nationwide, which caused the YoY to fall back again, was not well received by currency markets. With the current US inflation levels running close to 4.5% and the Fed worrying it is about to runaway and rates need to go up up up, at a time when US house prices are nearly as stretched as ours' but with crash signs evident and openly talked about on the media services, doesn't look too good for the pound over the coming months. And what is the implication of that? Does it mean Gordon has to keep HPI somewhere near 10% every year to avoid the pound getting smashed into the ground? It's a no win situation. I wonder if George Soros is watching sterling again?

Boomer

........and futher down the article

"Its been mixed on the data front, house prices fell but mortgage application numbers are better." said ING analyst James Knightley.

"The chart we have suggests that house price growth could accelerate up to 17 percent year-on-year over the next six months."

What chart is this? - the one they just drew on the back of a napkin?

[Realistbear]

........and futher down the article

What chart is this? - the one they just drew on the back of a napkin?

"Its been mixed on the data front, house prices fell but mortgage application numbers are better." said ING analyst James Knightley.

"The chart we have suggests that house price growth could accelerate up to 17 percent year-on-year over the next six months

The 17% figure was based on data in 2003 looking ahead to 2004. Current YOY increase is said to be 2.4% according to Nationwide and this is optimistic. IMHO we are long into negative YOY figures.

[jp1]

"Its been mixed on the data front, house prices fell but mortgage application numbers are better." said ING analyst James Knightley.

"The chart we have suggests that house price growth could accelerate up to 17 percent year-on-year over the next six months

The 17% figure was based on data in 2003 looking ahead to 2004. Current YOY increase is said to be 2.4% according to Nationwide and this is optimistic. IMHO we are long into negative YOY figures.

I know - it infutiates me how lazy journalists will print any old crap that an analyst spouts or they read in press release. My partner works in publishing and he reckons majority of [especially younger] journos havent a clue about statistics/figures. Most are english literature/media studies graduates and will accept without question what they are fed

[Guest Riser]

I suspect it may have been due to news that the housing market in Washington is still booming. The link between the stock market and these mixed housing reports seems more significant than ever, the markets could really tank once the crash takes hold. Most of todays cocky traders are not old enough to remember the last crash and probaby just feed off each others BS.

New Home Sales Hit Record Level in Oct.

New Home Sales Hit Record Level in Oct.

Tuesday November 29, 10:09 am ET

By Martin Crutsinger, AP Economics Writer

Sales of New Homes Soar to Record Level in Oct. in What Could Be Last Hurrah for Housing Market

WASHINGTON (AP) -- Sales of new homes soared at a record pace in October in what could be a last hurrah for the booming housing market.

The Commerce Department said that sales of new single-family homes shot up by 13 percent last month, the biggest one-month gain in more than 12 years. The increase pushed sales to an all-time high seasonally adjusted annual rate of 1.42 million units.

The increase confounded analysts who had been predicting that new home sales would decline by 1.8 percent, reflecting continued increases in mortgage rates. It was possible that the unexpected surge reflected a final rush by buyers to get into the market before mortgage rates climb higher.

The rise in new home sales was accompanied by an increase in prices, with the median price increasing by 1.6 percent from September to $231,300 in October.

Sales were up in most regions of the country, led by a 46.9 percent surge in the West and a 43.3 percent jump in the Northeast. Sales also rose by 1.9 percent in the South but were down 9.5 percent in the Midwest.

The nationwide jump in new home sales was the one bright spot for housing last month. Sales of previously owned homes fell by 2.7 percent, the National Association of Realtors reported on Monday, and construction of new homes and apartments also fell during the month.

Analysts believe the nation's booming housing market is beginning to show signs of slowing under the impact of rising mortgage rates, which are going up as the Federal Reserve continues a campaign to boost interest rates to make sure inflation does not get out of control.

David Lereah, the Realtors' chief economist, said he was looking for sales of existing homes to drop next year and for prices, which had been rising at double-digit rates, to moderate to a gain of around 5 percent.

The concern of some economists is that the booming housing market could have a bigger downturn, with sales and prices plummeting in the nation's hottest markets.

The worry is that activity in recent years has been pumped up by investors buying homes and condominiums in hopes of quick gains. If they suddenly decide to dump those properties, it could cause a glut on the market that would further depress prices.

[Guest consa]

LONDON, Nov 29 (Reuters) - Sterling fell against a strengthening dollar and was steady against the euro on Tuesday after softer than expected house price data, and flat monthly UK consumer credit figures.

Data released by the Nationwide building society showed British house prices remained steady in November.

But the November annual rate of increase slipped back to 2.4 percent after picking up to 3.3 percent in October.

Analysts said housing data would be looked at closely in coming months both in the U.S. and UK as investors speculate about the future trajectory of interest rates in the two major markets.

"I think the market is starting to focus on the U.S. housing market and when it does that it will also turn to the UK housing market as well," said HSBC currency strategist David Bloom.

http://today.reuters.co.uk/investing/finan...RLING-CLOSE.XML

[oracle]

Dr Bubb said the US economy was in iriversible decline, a fatally wounded leviathan being surplanted by the emerging Eastern superpowers. Mmmmm

Remember my prediction from a while back - FTSE to experience a boom thru 2006 / 7.

Super - growth for Earth plc.

I'm slightly more upbeat on the US than Bubb,just not for the next 15 years!

[FTBagain]

The pound is just over a cent down at the moment. Looking very week.

The dollar amazes me. Given the budget deficit in the US the Dollar should be taking a right caning. I can see only two reasons for it not tanking, the prospect of higher interest rates and the fact that the Chinese yuan is tided to the Dollar. If I was the US I would not be pushing too hard for the Chinese to free up their curracy.

OK the Chinese have problems, particularly over production. But I would rather have their problems than the UK / US problems. 2006 is going to be very interesting.

[ajh]

Currencies often turn at year-end.

We are not there yet- be patient

Also it is interesting that for 2 days in a row now the US Stock indices have jumped on announcements (Tuesday New Home Sales/Consumer Confidence; Wednesday GDP Growth) but then retraced during the day and finished lower.