This week was a fairly good week for economic data. The new home sales data was released. Even though the month of May was a little disappointing the current year data reveals improvement over the past year and that we may be on track for over 600,000 units sold this year. The existing home sales data was released. The number of units sold is being slowed by the lowest April inventory since April 1999. The revised first quarter GDP was released. The annualized rate was the fourth best of the past decade while the Real GDP was the third best. Improvement is improvement when emerging from a recession. What are the details?
(May 22) The week started with a forecast column for the new home sales report and the existing home sales report. ""New, Existing Home Sales Should Continue to Boom" was anticipating strong new home sales with regard to units and price. It also projected solid existing home sales. There was some concern expressed that a relative excess of supply of new homes could put a downward pressure on the average sales price. There was also concern that an existing home shortage could hold back the number of units sold and drive the average sales prices higher than ever. It is back supply and demand.
(May 23) The April New Home Sales report was a bit disappointing. The number of units sold did not increase, as expected, and the average sales price fell slightly from last year's record April level. "Disappointing April New Home Sales" details how, even though the monthly data was not as strong as it could have been, the data is revealing a strengthening market. This strengthening is based upon the current year data and the rolling year data.
(May 24) Existing home sales took a major hit during the Great Recession. The Great Recession was a Housing Recession, Jobs Recession, and Retail Recession rolled into one Gross Domestic Product Recession. "Lowest April Existing Home Inventory since 1999" details how historically low inventory for the month of April held back existing home sales. This is after historically low inventory for December, January, February, and March.The Current Year Existing Units Sold and Running Year Units sold data are revealing a strengthening housing market. It may take a fewer more years, and some more inventory, to return to the pre-recession peaks we had during 2005 - we already have higher sales prices than at the sales price peak of 2006.
(May 25) We received information this week that unemployment claims, first-time and continuing, while not at the low levels of last week are as low as we have seen during this time of year since 1971. "Unemployment Claims Still Matter" details how the non-seasonally adjusted first-time unemployment claims and continuing claims data are at generational lows. It also details how the low level of continuing claims may impact the U-3 Unemployment numbers in the May Employment Situation Report. The "Jobs Report" will be released next Friday.
(May 26)There was considerable teeth gnashing last month when the "first read" of the First Quarter GDP came in at an annualized rate of 0.7%. Never mind that first quarter is normally the weakest quarter and that President Obama had two negative first quarters ( 2011, 2014.) The data was revised from 0.7% to a "preliminary" or "Second read" level of 1.2%. This was not the best in a decade - it was the fourth best. The Real GDP stayed at 2.0%. This was a top three level for the Real GDP. "First Quarter GDP Top 3 of Past Decade" goes into more detail.e the ea
To sum up - New Home sales were good, not great, and better than they have been since 2008 - Crickets. Existing home Sales were good, not great, because of historically low inventory - Crickets. First-time Unemployment Claims and Continuing Claims were at levels not seen during the month of May since the early 1970's - not even crickets - dead silence. The GDP was revised considerably higher from 0.7% to 1.2% and Real GDP is stable at 2.0% and we received a sigh and a shrug.
What kind of news will it take to get people to report that we are growing nicely. Dow 21,000 was hit once again. Do we need to hit 22,000? 23,000? Wait - Comey is going to testify - behind closed doors - which means leaks will occur. Oh no, someone on the White House ordered Russian Dressing on a salad or asked for pistachios instead of peanuts - stop the Presses - Pistachios are imported from Iran - conspiracy. Someone was smoking a cigar in the Rose Garden - Was it Cuban? Supporting socialism - supporting a dictator. The media is too distracted by faux news that they do not understand that the economy is growing without their help. President Trump has a higher approval rating than Congress or the media. Enough said.
Remember those who died fighting for our country this weekend - not those who are fighting against our country.
It's the economy.