U.S. markets closed off today, while foreign markets ended generally positive. A bright spot in the US economy was the release of new home sales, which were estimated to be up 7.3% in April, to 323,000 new homes sold. This represents the fourth month in a row of increasing new home sales, but we’re coming off a dismal low. In 2005, 1.4 million new homes were sold.
The housing market reflects a classic supply/demand equation. The supply of housing far outstrips demand, and with a glut of foreclosed homes still in the market, the housing market is unlikely to return to 2005 levels for several years.
The markets seemed to be more concerned with the nation of Greece’s ability to service it’s debt. Keep in mind that about the only difference between Greece and the United States is 270 million people. Investors have yet to figure that out.
Chrysler today repaid $7.6 billion in government loans to the United States and Canada. Perhaps this will tide Treasury Secretary Tim Geithner for another 20 minutes or so.
Having said that, Secretary Geither hinted today that it would be “irresponsible ” for Congress to allow the nation to default on its debts by not raising the debt ceiling. Is he kidding? It would seem to me that allowing the nation to run $1.2 trillion deficits, and the general handling of the economy by this Administration would be the very definition of irresponsible. Perhaps he should be examining how we got to this point. A little circumspection could go a long way and would be a pleasant change of pace.