Well, the bad news is that we have to work today (well, most people) but the good news is that we have a long weekend ahead of us (and a lot of kayaking to do). I prospose we use the time to ponder how the housing market is really doing.
The housing stats and the anticipation of the Fed’s next move, seems to be largely reliant on misleading data. The Fed has ready indicated that they themselves are waiting to see what the data tells them before the next FOMC meeting. That in and of itself is reasonable, but the message seems to be that they are not in the driver’s seat. That is a big concern for the consumer.
I still contend that the weaker housing data has not yet impacted the overall economic stats in any significant way. When it does, the Fed may find itself needing to loosen monetary policy again after two years of belt tightening.
Housing market hangs in Fed’s balancing act [USAToday] . Adjustable-mortgage products that made the housing market more resilient over the past five years have left it more fragile as interest rates rise, complicating life for the Federal Reserve…a slowing housing market increases rental rates. In the Labor Department’s formula for calculating the consumer price index, rents are a big chunk of what’s called “core inflation,” a measure that excludes food and energy. Higher core inflation, in turn, spooks bond and stock traders, who fear an outbreak of inflation, putting more pressure on the Fed.
Mortgage apps fell by most in three months USAToday .
New home sales rise [Matrix]  but we know that the new home sale stats is so flawed that it should not be relied on.
Inventory fell [BW] . Inventory supply fell from 6 months to 5.8 months.
Sales of existing homes [BW]  increased but at the slowest pace in 4.5 years and prices increased 4.2% to $223,000 which is the smallest annual price gain since 2001.
The Fed is being more transparent as Bernanke promised but is that a good thing for housing? Here’s a recap of what the various Fed Presidents are saying [Reuters] .
Bernanke is too transparent and made a lapse in judgement [LA Times] . Bernanke acknowledged Tuesday that he made a “lapse in judgment” by discussing Federal Reserve policy with the CNBC television anchor — comments that subsequently drove stock and bond prices lower. Lower bond prices mean higher mortgage rates.
A Fed official calling for revision of US economic stats [MW]  since the data focuses on things like pay phones over cell phones.