Ugly Data

This post is going to be somewhat of a hodge podge of topics, data, and analysis.

No doubt the biggest news was the collapse in home sales. Existing home sales fell 8.4% to 6.12 million homes, from the estimated 6.40 million. That was the biggest one month decline since January 1989. Along with the drop in sales, came a drop in prices. Home prices in the 10 major metro areas fell 1.5%. I don't think I need to get into any further detail on this. Refer to previous posts on housing to hear my thought.

Red Book's same store sales came out today as well. Week over week, there down .3% and year over year, there down .20%. We are starting to see signs that the consumer is getting crunched. I expect big ticket items, such as boats, cars, and TVs, to be the most effected by the slowdown in consumer spending.

And for the icing on the cake, consumer sentiment fell again. It is down to 104 from 108.2 in March. Again the economists missed high on this one. The estimate was 105.

Alright, let's look at the market reactions to all of this messy data. The USD index is down, which can be expected. This is amidst a dollar decline in the price of oil. So gold rallying with the weak data and weak dollar right? Nope. It is doing the exact opposite and is down sharply. I don't always like to say this, but this seems like one of those times the U.S. central bank or some other larger holder with an agenda would strategically dump bullion on the market to keep the price down.

The stock market doesn't seem to care, it's trading up around 44.5 points at 11:30 A.M central time. Some of the strength can be due to the higher earnings number that are coming out. I haven't really talked about these earnings numbers too much yet. Corporate earnings for the most part are soaring and beating the street estimate. Wow, the economy must be strong if all of these companies are making so much money. Wrong again, this is a direct result of all the liquidity that is floating around. It has to go somewhere. These numbers are artificially high.