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Re: Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 11 of 20

Where did I say everyone is a victim in the economic discussion? That's my signature. It's been my belief, for decades, that we have a victim mentality in this country. A number of books have been written on that subject, back to the 90's. That simply relates to the overused phrase: "it's not my fault".


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Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 12 of 20

I have no idea why Retired Traveler is talking about everybody being a victim in a discussion on economics. 

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Re: Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 13 of 20

@CriticalThinking wrote:

Home building is a bedrock of the economy. When things are going well, home sales are ascending, and when the economy is in trouble, it's the opposite. Therefore, numbers in the home building/home sales industry is a key indicator of how our economy is doing and/or where it's headed. So much for economics 101.

 

"....

Housing Starts

 

 

Privately‐owned housing starts in September were at a seasonally adjusted annual rate of 1,201,000. This is 5.3 percent (±11.3 percent)* below the revised August estimate of 1,268,000, but is 3.7 percent (±12.1 percent)* above the September 2017 rate of 1,158,000. Single‐family housing starts in September were at a rate of 871,000; this is 0.9 percent (±8.9 percent)* below the revised August figure of 879,000. The September rate for units in buildings with five units or more was 324,000....".


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Re: Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 14 of 20

@gruffstuff

 

I agree with your posting --- same stuff I said. But it's not, by definition, the 'economy'. According to BLS numbers, and LEI's, the economy is great. Low unemployment, good gdp growth (some economists argue it is overheated a bit),  core inflation is good (rising interest rates are not bad for the economy as a whole; when they are too low, you have a 'liquidity trap'), durable goods are a bit weak.

   The 'economy' is great overall. But the debt situation of Americans is not the economy. It is a factor that will affect the economy in the longer run. A lot of people welcome rising interest rates --- more interest on CD's and bonds.

  I'm very aware of boomers with no savings. But they (includes myself) lived through the greatest expansion in the stock market of any market in the world and had an immense chance to set themselves up financially if they had started in their 20's. But that's another issue.   


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Re: Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 15 of 20

I surely don't know how you get from home builder confidence falling to the economy. 

 

Interest rates.

 

Rates going up, tax cuts geared to the 1%, exploding deficit, dysfunctional government, divided people.

 

Personal debt going up faster then wages, loss of confidence and trust in government, wages MIGHT be keeping up with inflation .......... this year.

 

Younger generations mired in debt, tiny houses, living in vans, living with parents, not getting married, not having kids.

 

Housing like any other market is driven by demand, young people can't afford to buy or won't take on the debt, boomers retiring and going into hunker down don't spend more then 4% of savings mode.

 

Half of boomers don't have savings to speak of.

 

Even small rate increases push a lot of people out of the market, and inflation is worse.

 

We have both.

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Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 16 of 20

Home building is a bedrock of the economy. When things are going well, home sales are ascending, and when the economy is in trouble, it's the opposite. Therefore, numbers in the home building/home sales industry is a key indicator of how our economy is doing and/or where it's headed. So much for economics 101.

 

When the GOP passed their huge federal budget and then the irresponsible tax bill, which will add almost $2 Trillion to an already out of control national deficit, many experts on Wall Street predicted interest rates would rise significantly and eventually slow down the economy big time.

 

When the cost of mortgages, auto, tuition, and credit card loans starts to rise, it results in people cutting back and spending less. When that happens, the economy is in trouble. There you go, more Economics 101.

 

The DOW is down over 500 points, so it sounds as if many experts agree that our economy is heading south.

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Re: Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 17 of 20

I surely don't know how you get from home builder confidence falling to the economy. The affordability of housing has been decreasing for decades. Everyone agrees that there is wage stagnation. Meanwhile, housing prices continue to go up and affordability drops. People are already burdened with various types of debt, meeting their bills, and can't even get the money saved for a down payment.

   Then there are interest rates. Interest rates rise in a healthy economic environment. That forces the prices of goods and services to rise, giving rise to the possiblity of interest rate rises to combat inflation.

  I'm thinking you guys need a bit of Econ 101 knowledge, and understand the history of the economy over the last 20 years, before you turn a robust economy causing inflation and rising interest rates into something the 'trump cultists' did.

   It's simply too expensive for people to pay their basic bills and to have enough to purchase, and maintain, a home. 

  In Econ, yes, it can be argued by some that high deficit spending on the part of the government leads to inflation, and higher interest rates. But this is highly debated. 

 

 


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Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 18 of 20

Yes Tom, Republicans used to talk about reducing the deficit, but as members of the Trump CULT, they voted to increase the nation's deficit by almost an incredible $2 Trillion. As a result, they got their short term tax cuts for the ultra wealthy and big corporations, but now interest rates are rising rapidly. Any small benefits the middle class received, are being eaten alive by inflation (loan rates are going up significantly for auto, home, tuition, and credit card loans).

 

If only Trump Cult members could think logically.....

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Re: Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 19 of 20
spot on my friend. I was just reading something online the other day and the general consensus is that maybe shortly before 2020 as you pointed out, the economy is starting to show signs of running out of steam, we could possibly be in the start of another recession possibly fairly soon, and the timing for Trump in 2020 couldn't be worse.
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Home Builder Confidence Plummets to the Lowest Level in more than 2 yrs

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Message 20 of 20

Here's an indicator of why the Trump economy is running out of steam as the national debt is soaring and interest rates are rapidly rising. 

 

Homebuilder confidence plummets to the lowest level in more than 2 years as demand stalls. Rising mortgage rates and continued home price growth are hurting affordability and fast becoming a toxic cocktail for the nation’s homebuilders.

 

From CNBC financial pages

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