The Fed’s Spectacular Failure To Stimulate Housing
by Dave Kranzler, Investment Research Dynamics
I guess I’m not the proverbial “tree falling in the woods with no one around to hear the sound.” No less of an analytic giant – a former insider to system – David Stockman has written a piece that echoes everything I’ve been saying now for over 18 months. The housing market is comparatively on its ass and the only means they have mask the real numbers is the “seasonally adjusted annualized rates.” Guess what folks, it’s not “the bad weather:”
Besides that, the seasonal adjustments are supposed to factor in weather—especially the possibility of snow and cold in the Northeast. On the considerable chance that the seasonals are screwed up, however, just consider the raw unadjusted, unannualized numbers for the month of February. During the coldest winter in recent times last year, the actual number of single family starts during the month was 40,600. This year it was 40,700. You need a microscope to tell the difference!
Given the fraud in the Census Bureau reporting that has been uncovered recently, I would suggest that the 40,700 was intentionally massaged so that the unadjusted, raw data would show a slight year over year gain for February. If they are only willing to engineer a .2% gain, imagine how bad the real numbers must look.
You can read the rest of Stockman’s excellent analysis here: Pushing On A String: The Fed’s Spectacular Failure To Stimulate Housing.
You can’t see the real data unless you really look for it. I spend a considerable part of my day looking for the real data. I know for a fact that the homebuilders have extremely overbloated inventories. I know this because I have spent time digging into the financials of almost all of them. They are ALL extraordinarily overvalued. You can read my research here and make money from this here: Homebuilders Are Overvalued
Two of my reports have already yielded over 20% for people who have taken advantage of them. This is despite the bubble fueled run-up in the entire stock market. But don’t take it from me or David Stockman, how about looking at the view of an economist for Trulia.com, one of the biggest online real estate brokerages in the country – click to enlarge:
Obviously Trulia has no incentive to lie about the inventory problem, unlike the Census Bureau, which is part of a Government trying to shove a fairytale about an improving economy down our throats…