Stocks Plunge, Consumer Pessimism Grows And U.S. Home Sales Just Hit Their Lowest Level In 3 Years
Stocks Plunge, Consumer Pessimism Grows And U.S. Home Sales Just Hit Their Lowest Level In 3 Years by Michael Snyder – The Economic Collapse Blog
It appears to be more likely than ever that the U.S. economy is heading for a recession. On Tuesday, the Dow Jones Industrial Average was down 301 points as investors were rattled by several very important pieces of news. Back in 2008, home sales began to fall precipitously just prior to the financial crisis in the second half of that year, and now it is happening again. Of course home sales are always going up and down, but the numbers that we are seeing now are definitely very unusual. According to the National Association of Realtors, existing home sales just hit their lowest level in 3 years…
U.S. home sales tumbled to their lowest level in three years last month and house price increases slowed sharply, suggesting a further loss of momentum in the housing market.
The National Association of Realtors said on Tuesday existing home sales declined 6.4 percent to a seasonally adjusted annual rate of 4.99 million units last month — the lowest level since November 2015.
And when you compare December 2018 to December 2017, the numbers look even worse. According to Wolf Richter, last month existing home sales were down 10.3 percent on a year over year basis…
Sales of “existing homes” — including single-family houses, townhouses, condos, and co-ops — in December, plunged 10.3% from a year earlier, to a seasonally adjusted annual rate (SAAR) of 4.99 million homes, according to the National Association of Realtors this morning. This was the biggest year-over-year drop since May 2011, during the throes of Housing Bust 1
Those are absolutely horrible numbers, but thanks to high interest rates they aren’t going to get much better any time soon. Just like a decade ago, this is going to be a very tough time to be in the real estate industry.
During the “boom years”, the west was the hottest region for real estate in the entire nation, but now it is leading the way down. And last month was just abysmal, with sales falling 15 percent in that portion of the country…
- Northeast: -6.8%, to an annual rate of 690,000.
- Midwest: -10.5%, to an annual rate of 1.19 million.
- South: -5.4%, to an annual rate of 2.09 million.
- West: -15.0%, to an annual rate of 1.02 million.
Unfortunately, these are exactly the kinds of numbers that we would expect to see if the U.S. economy was heading into a recession.
Investors were also rattled on Tuesday by news that trade talks between the U.S. and China seem to be breaking down…
Stocks fell to their lows of the day after the Financial Times reported the U.S. canceled a trade meeting with Chinese officials. CNBC later confirmed the report through a source. White House economic advisor Larry Kudlow denied the reports, saying the meetings are not canceled, giving stocks a boost into the close. China and the U.S. are trying to strike a permanent trade deal with the U.S. Both countries have been in a trade war since last year, slapping tariffs on billions of dollars worth of their goods.
We’ll see what happens, but the Chinese appear to be dragging their feet, and it does not look like there will be a major trade agreement between the two sides any time soon.
And when you throw in the fact that we are in the midst of the longest government shutdown in all of U.S. history, it becomes exceedingly clear that the elements for a “perfect storm” are definitely coming together.
In fact, Peter Schiff is entirely convinced that the coming recession is already “a done deal”…