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Goldfinger

U.s. Existing Home Sales Fell 2.6% In April To 5.99 Mln Rate

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http://www.bloomberg.com/apps/news?pid=206...&refer=home

May 25 (Bloomberg) -- Sales of previously owned homes in the U.S. fell unexpectedly in April to the lowest level in almost four years, dimming prospects for a quick recovery in housing.

Purchases fell 2.6 percent to an annual rate of 5.99 million last month from 6.15 million in March, the National Association of Realtors said today in Washington. The supply of homes for sale at the current sales pace rose to the highest since August 1992. The decline suggests that homeowners may have to cut prices further before sales stabilize.

Surprise, surprise!

Edited by Goldfinger

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I thought the USA HPC was over (well, it did last all of two weeks!) and prices and sales were booming again..?! :unsure:

:lol: They even think prices have to be cut (I thought they'd only go up??) before sales stabilize.

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I thought the USA HPC was over (well, it did last all of two weeks!) and prices and sales were booming again..?! :unsure:

The subprime mortgage issue is still to the fore and lenders are tightening their rules, making it more difficult for people at the lower end of the scale to get mortgages. Today's figure is a big disappointment after yesterday's new house sales data, although equity markets have just shrugged it off again.

I'm not sure where you heard house prices were booming, they have been on the way down for a while.

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As for the SMs going up once again on a tide of woeful economic data, that'll be your good friend, Helicopter Ben cranking up M3 to more than 15% btw...

They can tell me a lot about SMs being cheap because of 'low' P/E-ratios. I don't believe a word.

Even if E/P-ratios look good at the moment, they are based on expectations and expectations might be wrong. I think it

is grossly underestimated how bad of an impact faltering American consumption will have. There are first signs of

it: Japan exports less to the US, credit card use (Mastercard) in the US has jumped 20%(!) in Q1 2007.

Sentiment will change for stock markets in the same way we're witnessing changing sentiment in the UK housing market

at the moment. It is a slow process, but it will gain in momentum.

It is ridiculous to see that stocks are going up on bad news as well as on good news. Mergers push stocks up, and failed

mergers as well. It's all a big bubble.

Edited by Goldfinger

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http://africa.reuters.com/business/news/usnBAN548375.html

U.S. HOUSING

The U.S. housing market was also in focus ahead of existing home sales data due at 1400 GMT. Data on Wednesday showed sales of new U.S. homes rose sharply in April but builders also slashed prices by a record 11 percent.

Analysts interpreted that as showing the U.S. housing sector slowdown could have bottomed out, suggesting that the Federal Reserve was less likely to cut rates this year.

But one strategist said the weakness in the market could be investors reassessing the U.S. data and interpreting the drop in house prices as a sign that the sector is struggling, with potential repercussions for the UK.

"To my mind (the prices component) demonstrates that the housing market slowdown in the U.S. is a lot deeper than we thought," Neil Parker, market strategist at UBS said.

"We may not have seen the worst of the U.S. housing market slowdown yet. That knocks on to slower economic growth in the States and also could potentially have implications for the UK housing market as well."

In the banking sector, HSBC, Europe's largest bank, was flat after saying it had made a good start to 2007, helped by a strong performance in Asia, and said its efforts to resolve problems with its U.S. mortgage book were working.

If the US growth weakens does a wall of money flood into Europe ?

Edited by Ash4781

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They can tell me a lot about SMs being cheap because of 'low' P/E-ratios. I don't believe a word.

Even if E/P-ratios look good at the moment, they are based on expectations and expectations might be wrong.

plus with the all the financial stocks in the indices you have to believe their "earnings" wont be blown away by all the junk securities on their books going sour

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From the Bloomberg article:

Housing accounts for about 23 percent of the U.S. economy, when taking into account purchases of furniture, appliances and items for new homes, according to the Joint Center for Housing Studies at Harvard University in Cambridge, Massachusetts.

How is that number in the UK? And is that including the related banking/mortgage business?

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