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Home Sales Miss
The Market Bull 2018

00:00 / 2:37

Unable to hold their early gains the major averages enter the final hour about even. Since Monday the Standard and Poors 500 Index is up, 5 points or .2%while the NASDAQ has slipped 12 points or .2%.

Existing home sales fell for a 6th consecutive month in September, missing expectations for a 5th month down 3.4% to 5.15 million units annualized. On a year ago, basis sales have slipped 4.1%. Prices have gained 4.2% from a year ago to $258,100. Inventory increased slightly to a still low 4.4 months. The western region was particularly weak with a 3.6% decline for the month, on a year ago basis sales are down 12.2%.

Record debt levels accumulated in the post crisis period since 2008, tottering real estate markets and a growing trade war with the USA that so far hasn’t had much real effect, cause China to miss its economic growth target in the 3rd quarter at 6.5%. The Shanghai Exchange has now fallen by more than half since its June 2015 high, and 30% since its recent high early this year. Also, of note despite a published economic growth rate that nearly doubled the size of the Chinese economy over the last 10-years. The Shanghai Composite Index has essentially gone nowhere. That said it did blow and pop 2 large bubbles. The real problems in China are found in provincial government up to its eyeballs in non-performing loans and white elephant projects that were used to meet state mandated growth targets. So far, the Chinese investing public clamors for bailouts for their real estate and stock bets that have gone south, borrowing a page from the US Bankster Book in the process. Last time I checked capitalism didn’t mean privatized profits and socialized losses at taxpayer expense.

This is Caleb Lawrence Registered Investment Adviser Scotts Valley Drive and Willis Road in the Scotts Valley Plaza, Suite 202 or call me toll free at 888-RICH PIG / 888-742-4744.

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