Will The Renewed Weakness In Housing Drag The US Economy Into A Recession?
Housing led the US out of seven of the last eight recessions. Will it play the reverse and derail the US economic recovery this time around? As it stands, existing home sales fell for the second consecutive month and by 5.1% mom in June, after a government tax credit for buyers expired in April. Similarly, new home sales, which account for less than a tenth of housing transactions, collapsed in May. Although
the sales bounced back by 23.6% mom in June (-36.7% in May), it stayed at the second-lowest level on record. Since then, the manufacturing-led expansion, which began in the second half of 2009, has also been waning, with jobless claims rising and factory orders falling.
Tracking The World Economy… - 24/08/2010
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