Joshua Shapiro
Joshua Shapiro
home pessimism reasonably reasons
There are reasonably deep-seated reasons for pessimism on the part of home builders.
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Housing has peaked and we're expecting some moderate weakening in 2006. It's starting to turn into a buyers' market, with fewer buyers chasing more homes at these mortgage rates.
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The January blowout was no doubt mostly a function of record warm weather enticing shoppers out of their homes in much greater numbers than normal for the month.
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We would not jump to any conclusions based on these numbers, particularly as the weekly jobless claims figures, adjusted for hurricane effects, point to considerably stronger job growth than reported.
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With anticipations of higher rates still clearly in the minds of buyers, we cannot rule out fence-sitters rushing ahead of higher rates.
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Everyone was so focused on the word 'measured' that they didn't expect them to update the rest of the language to be more aggressive, so that took people by surprise a little bit,
affluent bills build colder consumers impact less lifestyle rather
As things get colder and heating bills build up, it's going to come right out of discretionary spending, which will impact less affluent consumers more. For the wealthy, it's an inconvenience rather than a lifestyle change.
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While this was obviously a good month, we don't expect this to continue. We think it's going to be a slow drift up in core inflation going forward.
disruption due energy markets orders prices remains seen solid trend ultimately volatile whether
While these orders have been volatile of late, the trend remains a solid one. Whether we will see a disruption in this trend due to the surge in energy prices remains to be seen and will ultimately be more important to markets than today's pre-Katrina outcome.
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Well, with gasoline well over $3.00 a gallon in most places when this survey was conducted, it is little wonder that consumers were cranky,
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Export growth will remain solid in the months immediately ahead, which ought to help blunt (but not fully offset) the detrimental effect on the trade deficit of a likely acceleration in import growth.
adjustment builders process pumped
Builders were able to build and so they were out there doing it, and the seasonal adjustment process pumped it up.
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Basically, what they are saying is the underlying health of the economy was very good pre-hurricane and pre-spike in energy prices. And it is still pretty good after those things.
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People were expecting the worst and I think the reaction you saw is that it wasn't as Draconian as many had feared. There wasn't any real hard table pounding or anything in the minutes that pointed to a 50-basic point hike at the next meeting.