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"Wall Street stumbled Wednesday as unexpected weakness in the housing market and a slide in oil prices weighed on stocks."
"After rising for five consecutive months, new-home sales fell 3.6 percent in September from the previous month, to a seasonally adjusted annual rate of 402,000, according to Commerce Department data released Wednesday. Analysts had expected sales to rise. Sales were down 7.8 percent compared with September 2008."
I'll hold out cautious optimism for now. For every new headline touting "recovery underway," there is a new headline that contradicts it.
Sure - it moves forward in "fits and starts" - as in ANY recovery.
Overall though the trend is positive - as evidenced by the increasing GDP, the better than expected results posted by companies over the last few weeks (roughly 80% beat profit estimates - but more importantly roughly 60% beat EARNINGS estimates), the upward adjustment of sales projections by many US companies over the last couple of weeks, etc, etc, etc).
Will there continue to be bad news?
Of course - mixed wth good news, but as time goes by there will be more and more good news and less and less bad news.
That's the way it is in ANY recovery.
You can't hit your populace with massive taxes and then spend your way to recovery.
dude, this is America, not Zimbabwe... We do what we want! It's impossible for us to fail! Capitalism is Corporatism! Peace is War! Fiat paper is Gold!
Sure - it moves forward in "fits and starts" - as in ANY recovery.
Overall though the trend is positive - as evidenced by the increasing GDP, the better than expected results posted by companies over the last few weeks (roughly 80% beat profit estimates - but more importantly roughly 60% beat EARNINGS estimates), the upward adjustment of sales projections by many US companies over the last couple of weeks, etc, etc, etc).
Will there continue to be bad news?
Of course - mixed wth good news, but as time goes by there will be more and more good news and less and less bad news.
That's the way it is in ANY recovery.
Ken
I personally believe that this recession was a necessary correction. A bit drastic in its scope and depth, but overall I believe it has forced companies to realize new efficiencies, and that's a good thing in my opinion. I haven't looked closely at overall revenues, but I have to wonder if the companies that are beating earnings estimates are actually seeing increased revenues, or are they actually realizing those earnings from increased efficiencies? Doing more with less, if you will.
I personally believe that this recession was a necessary correction. A bit drastic in its scope and depth, but overall I believe it has forced companies to realize new efficiencies, and that's a good thing in my opinion. I haven't looked closely at overall revenues, but I have to wonder if the companies that are beating earnings estimates are actually seeing increased revenues, or are they actually realizing those earnings from increased efficiencies? Doing more with less, if you will.
Read my post again.
80% are beating profit estimates (doing more with less)
60% are beating EARNINGS estimates (revenues greater than expected).
Now keep in mind that these earnings are NOT an increase from earnings in the previous quarter (or year over year) (last quarter we WERE still in a recession) - but they DO represent an INCREASE in income from what those companies were EXPECTING to make - in other words their sales were not as bad as they thought they would be, and in fact, many of those companies are upgrading their sales projections for the next few quarters.
IMO a lot of concern is based on the fact that a good portion of that GDP was based on government spending. If that spark doesn't kickstart the economy, then what, Stimulus 2,3,4,5,6? On top of the massive burden of healthcare and the wallop coming from cap and trade? This isn't a free-market ideology running Washington now, they appear to be very comfortable with government control of, well, everything. You can't hit your populace with massive taxes and then spend your way to recovery.
That's certainly true, but all indications globally are that markets are rebounding.
All the predictions to-date that things would collapse have proven false. You can go back in this forum alone and look at any number of predictions made by radical conservatives that the market would have collapsed by Fall and that hyperinflation would have had us running around with cash in wheelbarrows by now.
Obviously, anything could happen, but all the indicators are starting to trend (with ups and downs) in the positive direction and the system seems to be stabilizing.
The bigger question we should be asking is, why do we need to build more homes when there are too many as it is? Is this really the fundamental basis for a sound economy - growth for the sake of growth? Sounds like the mission of a cancer cell to me.
But, I guess that's beyond the scope of what business and political leaders focused on the next quarter or the next election cycle care about.
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