The Dow was down 400 points this week as worries about the weak housing market, the war, and problems with BP’s Oil Spill Disaster continue.
Existing Home Sales fell 2.2% in May and inventories rose to a 8.3 month supply. Sales were down 18.3% in the Northeast, unchanged in the Midwest, up 4.9% in the West, and up .5% in the South.
May New Home Sales (contracts signed in May for New Construction) was down a whopping 32.7%. It was the weakest new home sales figure ever! The ending of the home buyer tax credit program is really affected the housing market in a negative way (if you ask me). Now the $64,000 question is what happens to existing home sales going forward? Will we have a double dip in the housing sector? It’s anyone’s guess. One thing is for certain its a great time for buyers!
The Fed left the Fed Funds Rate Unchanged and the FOMC said they are keeping the Fed Funds target rate at 0 to .25%. They also said inflation will most likely remain at subdued level.
May New orders for Durable Goods falls to a 6 month low down 1.1% excluding transportation it was up .9%
Gold is at $1,256 an ounce and Oil is at $78.88 a barrel
Rates are at historic lows, 30 Year Fixed Rates at 4.69% and the 15 Year Fixed Rate is at 4.19%
Its anyone’s guess what happens with the economy and the markets. There are many things that are factors. The jobs situation is clearly a huge deal, without employment figures changing we are probably dead in the water. The Oil Spill Disaster is a huge issue, it is unclear what the long term affects will be but many people think it could affect the Gulf Region for decades! I sure hope not. The other problem I see is the housing market, I don’t see how this home buyer tax credit program really helped things at all? However, its a great time for buyers! Rates are at historic lows. I think we might go sideways for alittle bit until some of these issues get resolved but, we’ll have to wait and see.
Jun - 25 | 
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