The last time (late November) when the Case Shiller/S&P 20-city housing index came out, I expressed a fear that housing would slipd down toward, and perhaps through the breakeven line after a recovery from the late 2008 into 2009 lows. Turns out, that fear was well-founded:
New York, December 28, 2010 – Data through October 2010, released today by Standard & Poor’s for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, show a deceleration in the annual growth rates in 18 of the 20 MSAs and the 10- and 20-City Composites in October compared to what was reported for September 2010. The 10-City Composite was up only 0.2% and the 20-City Composite fell 0.8% from their levels in October 2009. Home prices decreased in all 20 MSAs and both Composites in October from their September levels. In October, only the 10-City Composite and four MSAs – Los Angeles, San Diego, San Francisco and Washington DC – showed year-over-year gains. While the composite housing prices are still above their spring 2009 lows, six markets – Atlanta, Charlotte, Miami, Portland (OR), Seattle and Tampa – hit their lowest levels since home prices started to fall in 2006 and 2007, meaning that average home prices in those markets have fallen beyond the recent lows seen in most other markets in the spring of 2009.
The chart above depicts the annual returns of the 10-City and the 20-City Composite Home Price Indices. In October 2010, the 10-City and 20-City Composites recorded annual returns of +0.2% and -0.8%, respectively. October was the fifth consecutive month where the annual growth rates moderated from their prior month’s pace, confirming a clear deceleration in home price returns. The 10-City Composite posted a +0.2% annual growth rate in October, versus the +5.4% reported five months prior in May, and the 20-City Composite has now reentered negative territory, down 0.8% in October versus its +4.6% May print.
All of which boils down to one thing, in my view: The odds of the stock market putting on a major rally for at least the first half of 2011 has just fallen. And the other thing? Deflation is back on the front burner for the Fed, so look for even more QE’s to come as they try to pump the market hard enough to hide the stealth Depression in plain sight.
Data Day, Golden Year
As one who lives, data-day, be sure to check back in half hour to an hour by which time I should have the new Case Shiller/S&P 20-city real estate figures sorted out. They should be out any minute.
A little later on in the morning, the consumer confidence numbers from The Conference Board are due, but a quick check of the precious metals is what caught my eye first thing today.
We note that Gold seems likely to close the year very close to $1,400 per ounce, and a check of the charts over at www.kitco.com reveals that 2009 gold closed about $1,090 an ounce.
The Boyz down on Wall Street can throw rocks at us all day, but that little goin coin of ours was up 28.4 percent (plus or minus a couple of days of trading left) for the year.
We also note that our few ounces of silver did pretty well, compared to Wall Street. The silver which closed out 2009 at $17 will likely setting around $29.50 plus or minus the balance of the week.
I apologize if you only made 73.5%, but what can we say?
The longer term return has been to run from $7 which I told you in July 2005 that we were buying some silver to present is only 421 percent, but that’s a whole 5½ years.
Oh, and for the sake of balance, our savings bonds still return roughly the same purchasing power, too, so overall it hasn’t been a bad year for our net worth and we sincerely hope you’ve done even better.
With stock futures pointing higher, it’s only fair to point out how the Dow and the S&P have done.
The Dow closed last year out at 10,428.05, and so a close at 11,600 this year would put Dow gains around 11.24 percent, less than half of what gold turned in.
And the S&P 500 closed 2009 at 1,115.1, and if the average can close out this week in the 1,260 range, then it would be up for the year just about 13 percent, outdoing the Dow.
For the wild West gambler types, the NASDAQ (composite) closed 2009 at 2,269.5 and may end the week around 2,670 (?) which would be a 17.65 percent gain, roughly.
Citizen Reporters/You Be the Reporter
Trouble of Florida
Have this interesting reader report – an ‘eyes on’ it report that I’m sure someone could debunk. but try these observations on for size…
“Just returned last week from visiting my former home of 30+ yrs – the NW FL coast along the Gulf of Mexico, where I was a news director, business owner, and retired after 20 years as a SpecOps flyer. I visited the waterfront three times at three different locations – the results were always the same. No life was visible in the clear waters along the shoreline or even looking down into the waters from piers. No baitfish, no medium or larger fish, no crabs, no live seaweed or other water plants. I saw no shorebirds (sandpipers, etc), one pelican, two heron, and only a handful of gulls. Weather was not a factor (sunny and 60′s & 70′s), nor was water temperature, as the life I found missing is normally present year-round. Also of interest – I only counted the tracks of two raccoons; seems even those garbage guts have disappeared in large numbers. A curious coincidence? Doubtful – much as another coincidence of alot of US Navy P-3 flights reported over the northern Gulf of late, along w/the closure of 4200+ square miles of prime fishing waters in the northern Gulf. BTW – the P-3, while a popular anti-submarine warfare and SIGINT platform, is also prized by the US Forestry Service for it’s ability to dump and spray fire retardant and other chemicals on burning forest fires. And did I mention the near-no-notice FEMA conference held quietly in Ft Walton Beach two weeks before Christmas? While no mention of the conference can be found on FEMA’s website, hotel staff at [named hotel] confirmed the FEMA conference took place, altho details were unknown. I’ll let you & your readers do the math. – A Concerned Observer“
Comments from readers in the Fort Walton beach area would be appreciated…
Orwell Does Climate
Fine article over at Robert Felix “Ice Age Now” website under the heading “A Blizzard of Lies in the New York Times” which I think I pointed to the other day: “Bundle Up, It’s Global Warming“. Not saying the Times lied, but it sure is an interesting debate.
Obviously, we need to apply caffeine liberally: First, the NY Times piece is an op-ed, not an article, per se. Secondly, the author of the article is described as the “,,,director of seasonal forecasting at an atmospheric and environmental research firm….” He’s got skin in the game, as it were.
But the two views force us to return to the climate debate (will it ever end?) and look at the data. Yes, it’s likely that (on average) the year 2010 will be among the top three hottest in the past ten years. Score one for the NY Times piece.
On the other hand, if you’re only looking at 10-years, statistically speaking five years would have to be ‘above average’, wouldn’t they?
And then, we have to award points to the Ice Age Now site for noticing that “It’s Orwellian when cold is declared warmth.”
Orwell’s sister is all over the place, including supermarket checkout stands, so why not?
Back to substance (although it’s a lot more boring that bloviating): This morning, we notice that SpaceWeather is trumpeting the arrival of sunspot 1138.
Since CO2 on earth hasn’t driven the climate changes on Mars, Saturn, or Jupiter, I’m just guessing that events on the Sun will do more to earth’s climate over the next 20-years than all the COP2 sources of the world combined.
Seems to me, either way it goes, the winning hand to play will be the home gardening plans, since the world running short of food because it’s too hoyt, or too cold, is not something I’m particularly anxious to participate in.
Oh, and it may have something to do with the big push to get a “food safety” bill passed. Government control of food, eh?
A reader offers this:
Hi Mr Ure, I don’t know if you are already familiar with this. I got a book, ‘The Electric Universe’, for Christmas. A couple of passages caught my eye as touching on things you have written about. Thought you might find them interesting.
‘The simplest model for the 22 year magnetic sunspot cycle involves modulation of the electrical power input from the galaxy. The galactic power is direct current and the solar cycle is due to a varying DC power supply to the Sun. The solar circuitry seems to behave like a secondary winding on a transformer, which responds to the varying DC current to produce a magnetic field which switches polarity.’
Sheesh! Don’t mention that around our local ham radio club, because that might get a debate going whether sunspots cause good DX conditions, or maybe it’s something more subtle; a background condition change to which sunspots are coincidental not necessarily causative of the changes in RF propagations in the HF spectrum just under the MUF.
There’s not enough beer in Anderson County, Texas, to resolve that one!
Then we have the story out of the NY Daily News this morning that “Blizzard cleanup is high priority despite budget crisis, mayor Bloomberg says.”
A cynical reader (been taking lessons, somewhere?) writes:
“I can see this easily being spun as an excuse to raise taxes for snow removal in spite of the number of years when snow fall was mild.”
That’s smacks a bit of “Don’t pay the lifeguards unless they actually save someone” thanks. Overtime is overtime and all we have to bargain with in this lifetime is our time and our brains. Everything else, we need to trade for.
A few readers have corrected my thinking about this week’s snows:
“If you think this is winter in New England you are way, way wrong! I lived in NE for many, many years and certainly it gets cold and it snows but a storm of this present magnitude is very rare. Snow and a blizzard are far from the same thing. This storm is historical and not to be considered anything average for a NE winter.
The nearest thing to this storm I have seen in recent years was actually here in Southern PA in 1995 – certainly not the usual winter here either.”
I sit corrected, with plenty of hot coffee…
Is there something going on with the Pacific tectonic plate that might be getting ready to, oh, you know…crack it?
More quakes down under (the equator) and now we read about the latest 6.3 quake down in Fiji. Is the mid-Pacific rise about to give rise to more than just the normal growth of the Pacific plate? That’s in the area (great circle-wise) from the Bonin Islands of Japan down to Chile, right?
Or, to put the question in simpler form: How big can the Pacific Plate get before it breaks of its own internally generated stresses? I bet a magnitude 10 quake would really be something to tell the grandkids about – if there were any after such a thing.
Oh, and the California and Alaska shake maps continue active with lots of small quakes…
Interesting data to watch develop.
The first private online magazine in China has been shut down, with talk about the FCC having net control being the reason this is getting so much play.
Speaking of China
They are reported by the Washington Times to be fielding a new kind of carrier-killer naval weapon, so, says the FT, the US may move a bit farther offshore on exercises...
If you think the people are being conditioned into a kind of stuypor by too many drugs, check out the WSJ online piece about how 25% of kids and tends are taking prescription pills.
Hell, I thought I was a risk-taker sneaking a smoke on the 3-mile walk home from Jr. High back in the day.
Tranks a lot…
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