It is that time of the month again... The Case Shiller report is released on the last Tuesday of the month and is eagerly anticipated by Wall Street as well as other industries that are tied to the housing market to shed some light on the market. I have previously posted the Case Shiller report and the data that it tracks. You can find that from about a month ago on my blog at www.GregShepard.com.
There is some good news contained in the report this morning...but you better have a good magnifying glass in order to spot it. http://www.standardandpoors.com/indices/sp-case-shiller-home-price-indices/en/us/?indexId=spusa-cashpidff--p-us----
Watching Robert Shiller this morning on television, he really didn't want to get painted in to a corner by declaring the market is improving or if it still had room to decline. Here is a link to the video of his interview. http://video.foxbusiness.com/v/1532717612001/yales-shiller-unsure-about-future-of-housing/?playlist_id=87061
If you watch Mr. Shiller's interview, and have watched some of his others, you will notice that he looked very uncomfortable this morning. It almost seemed like he knew something, but didn't want to expound on it much.
There are some other reports out this morning by the national home builders that their new housing starts are on the rise...which reminds all of us that this information is comprised of composites, and does not encompass all markets. The "800 pound gorilla in the room" will be the confusion in the unemployment rate. If it truly is dropping as we are told, why isn't the housing market getting better? And if it is truly dropping as we are told, why aren't income tax receipts to the federal government increasing? Could it be that the unemployment rate is being manipulated for political gain and isn't actually dropping as a result of a new hires?
As the quote from the old Virginia coal miner goes, "No matter how thin I try to make my pancakes, they always end up having two sides.", so go the reports today.
Pick whichever side of this debate that you wish...and the reality of it is, you will pick the winning side however you so choose.
The 10 year U.S. Treasury Notes have been increasingly more volatile over the last couple of weeks as those European countries with the most serious deficit issues grapple over their financial futures. One day the situation seems to be moving toward an amicable solution and the 10 year T-Bill goes up, and the next day the situation seems to heading toward a meltdown and the 10 T-Bill goes down as the world markets look to the "stability" of the U.S. 10 T-Bill. There is an oxymoron if there was ever one in the current financial market!
The good news to report in this is that the Alaska Real Estate Market has been very stable compared to other parts of the country. Growth, although somewhat slower, is still occurring. Unemployment statewide dropped again, and the outlook for the Mat-Su borough remains very positive through it all.
Having witnessed the complete and utter collapse of an economy and a real estate market over the course of the last 6 years in the Brainerd Lakes Area in Minnesota, witnessing life again has been one of the more difficult things to adjust to. Over the course of 3,168 miles and 5 days in a 26' U-Haul Time Machine, it is though we were sent back to Brainerd in 1996. Back to when the infrastructure wasn't equipped to handle the burgeoning traffic, when the businesses were facing labor deficits and it was the model of economic growth.
When were packing to leave, Sherri found an article out of the Brainerd Dispatch from January 2000. The biggest fear that they faced then? With around a 3% unemployment, area businesses didn't know how they would be able to attract employees to the Brainerd area! It has now had the state's highest unemployment rate for cities over 10,000 people for over 4 years with unemployment rates ranging from around 11 to the low 20s percent.
It is inconceivable that the Brainerd area could deteriorate that fast. Over the course of just 7 years, it went from first to worst. No one could have ever predicted that dramatic of a change that fast...and the resulting carnage will likely take a generation (or more) to recover from.
I wasn't raised a quitter...but I wasn't raised to be an idiot either.
The "quitter" side ultimately won.
Come on global warming!!! We are tired of driving on "glaciers" on the side roads....
Greg
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