Continued lacklusterness in ths US economy is a discouraging sign for the rest of 2006.  Some of the latest data below confirms a theory I've had since 2003:  The recession starting in 2001 was not a real recession as the Fed and Bush tried to curb the downturn with a friendly rate and tax environment.  These artificial stimulants led to a thinly veiled and weak economic recovery and I think the coming years may prove that you can cheat an economic recession about as much as you can cheat death.

 

 

The latest housing numbers suggest flat to negative sales trends to come.  The first link talks about a record long inventory for new homes while the second link below shows nation-wide declines in existing home sales for last month.  Median existing home prices continue to rise year-over-year but are declining sequentially in all major regions except the Northeast.  Pundits are cautious about drawing a trend without another quarter of data, but there's nothing in the numbers to make me optimistic at this piont.

 

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B7A324C0B%2DDAFF%2D438C%2D96BF%2DE50042A5E655%7D&siteid=mktw&dist=
http://www.realtor.org/Research.nsf/files/REL0601EHS.pdf/$FILE/REL0601EHS.pdf

 

A friend of mine also sent the link below, which is pretty appropriately timed.  It talks about very limited appreciation in American household net worth over the last few years as soaring home prices have been negated by corresponding rises in household debt.

 

 

Of course, the temporary "technical" reversal in yield rates is going into week 3 now and crude futures (pictured below) continue to float at record levels.

 

For me this means the following with regard to both real estate and broader investment decisions.  However, as usual, draw your own conclusions and remember that there's a reason some information is free :)