The Banking and Strategy Initiative

Chillin' out till it needs to be funded

US Economy: Housing Market Indices start the hope run

The budget’s 4% cut in Defense spending and the increase (nominally) of over 5% to Medicare, Medicaid and Social Security were probably not the reasons the Euro downgrades of yesterday and today’s okayish GDP calls were swung on the bell’s camel back. The Builder index jumped to 29.0 instead of the expected 26.0. The index says how builders feel about single family housing starts which we said was the weakest link in the 2012 recovery sweepstakes fueled by the weekend’s foreclosure settlement and the rush by banks with cash incentives upto $35k for short sales/ foreclosures on underwater mortgages.

Empire State ( the index) rose to 19.5 despite a drop in New orders and a plateau on settlements, with the average workweek up to 7.1 , almost a 10% rise

The afternoon actually expects only the FOMC spread out from the 25th Jan meeting, before they get to it in March

Our favored MBA purchase report had a turn of fortunes with the Purchase Index unable to keep up dragged the composite down with a 8.4% decline even as the refi barely managed to keep last gains and the MBA Purchase composite fell a pip ( 100 bp 🙂 )


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