If the housing market can’t recover until the jobs market recovers, and according to the media hailing Obama’s great jobs recovery, one would expect a housing boom. How many cranes do you see in your hometown?
Case in point, an AP headline this week: “Americans Hold Onto Positive Economic Outlook.” Well, happy days are here again. What was the premise for the headline? Consumer confidence held nearly steady in March at 70.2 down from a revised 71.6 in February. A reading of 90 indicates a healthy economy, a reading of 100 indicates a growth economy.
The AP school of journalism must celebrate when their children bring home a ‘D’ on their report cards. Why look little Johnny got another ‘D’ the best grade in a year, and we can celebrate it’s not an ‘F’!
The reason we hear ad nausea why consumer confidence is so important? Confident consumers spend, and consumer spending accounts for 70% of economic activity. If the AP had any reporters with the curiosity of a three year old, wouldn’t they then question why rising gas, food, and energy prices aren’t harmful to consumer spending?
Nope, not this reporter who wrote;”Gas prices are up but so is the stock market. Home prices are down but so is unemployment.” I can hear the grill cooks at McDonald’s saying; ‘Hey Joe, sucks about these gas prices but my 401k is skyrocketing, it’s all good!”
Quoting an economist from the AP writer’s brilliant analysis; “The resilience suggests that jobs remain a more important concern for consumers than gas prices.” This too is simply brilliant. If you don’t have a job, you’re not worried about gas prices. The government can just mail you your check.
The news wasn’t good again in housing this week; Case Schiller reported home prices falling again in sixteen of nineteen cities reporting. The NAR reported homes going under contract fell in February from March, although up 9% over last February when the country was buried under a foot of snow compared to this year’s balmy Groundhog Day, new home sales continue at depression levels, while the majority of construction starts were multi-family, again.
Back to AP’s contention consumers are holding onto a positive economic outlook. Wait until they see what Obama is doing for electricity rates. New EPA regulations on CO2 will effectively eliminate any construction of new coal fired power plants and cause many existing plants to close. All thanks to Lisa Jackson who’s picture hangs above the alter of every environmental extremist.
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