“Home Sales Up” Yeah. Right.

Warning: this post laced with sarcasm. Sarcasm shown in italics for clarity.

So the stock market bounced up yesterday (two days in a row, woo-hoo!) cuz of two things:

1. An 80+ year old respected financial institution is gonna be sold for a 95% discount (off its recent high) instead of a 99% discount. Ooohhh, I bet those Bear/Stearns shareholders are strappin’ on the ol’ party hats now!
2. Headline screams “Home Sales Up.”

I’m not even gonna comment on the idiocy of #1 above. But let’s take a closer look at #2.

Home sales. The headlines trumpeted an unexpected rise in existing home sales. Woo-hoo, the housing slump has bottomed!

But here are all the facts:

1. Feb sales rose by 2.9%
2. Feb sales are still down 23.8% from last Feb.
3. Sales prices fell 8.7% from last Feb, biggest decline in 40 years.
4. Sales of existing homes fell by 12.8% in 2007, the biggest decline in 25 years. 
5. Feb foreclosures up 60% from last year.
6. Feb marked the 26th consecutive month of year-over-year increase in foreclosure-related filings.
7. In Feb, 1 in every 557 homes received a foreclosure filing. [Read the foreclosure report yourself.]

Now here’s the cute part: when a house is foreclosed the deed changes hands from the homeowner to the bank. This change in deed is counted as a home sale.

Yes, the “increase” in home sales for Feb are artificially inflated by all the foreclosed homes! Just another way your gov’t keeps you in the dark, thinkin’ everything’s OK.

So, now you know: no matter how much lipstick they put on the housing pig, it still reeks.

◊◊◊◊ Now: Gold @ $933.40, Silver @ $17.71, USDX @ 72.25 ◊◊◊◊