Just once, it would be nice to have housing news headlines match the data. Today’s headline from Reuters said Home Sales Surge, Jobless Claims decline. Sounds great, until you read the article: [Thanks L!]
WASHINGTON (Reuters) – U.S. home resales jumped more than expected in December despite bad weather as sellers cut prices while jobless claims fell sharply last week, offering some hope for the economy’s two key trouble spots.
Existing home sales soared 12.3 percent to an annual rate of 5.28 million units, the National Association of Realtors said on Thursday, far surpassing forecasts for a rise to 4.85 million. However, sales were down 2.9 percent from a year earlier.
Given that media “economists” are nearly in a permanent state of surprise, missing forecasts doesn’t mean much, nor does the month-to-month data, always fraught with variability. As usual, the meaningful year-over-year decline is nearly ignored- and doesn’t match the headline.
While we’re at it, let’s not forget the “Jobless Claims Decline” part of the headline. Here’s the supporting text:
In another report, applications for new jobless benefits posted their biggest decline in nearly a year, erasing a holiday-related spike to show a steady if slow improvement in the labor market. Claims retreated to 404,000 from 441,000 in the prior week, the Labor Department said.
The BLS’ struggle with seasonality continues. After last week Initial Claims were far worse than expected, this time they were due for a flip, and as expected, came in better than expected, printing at 404K on expectations of 420K, compared to a revised 441K. The Non-seasonally adjusted claims declined from 763,098 to 550,594. Continuing claims was also better than expected, coming at 3,861,000 on expectations of 3,985,000. All in all, another number that will be revised worse next week, and which does nothing to dent the Unemployment Rate which needs consistent sub-400k claims to actually improve the jobeless rate. Probably most interesting was that persons claiming UI benefits across all programs jumped by nearly half a million in the week ended January 1 to 9.6 million.
Remember, unemployment is currently the leading cause of foreclosure. Unemployed people have a tough time making house payments.
Nevertheless, Reuters dutifully proclaims:
“Most of the reports today were fairly good. For anyone skeptical about the U.S. recovery, these should ease concern,” said Kathy Lien, director of research at GTF Forex in New York.
I’m not feeling better. Are you?