Sharply worsening housing recession and rising energy costs ready to rattle the equity market but here is the silver lining
Peter Oberois
May 24, 2008

The worsening housing recession and rising energy costs are real. U.S. stocks are falling extending the market's biggest weekly retreat since February, on concern a worsening housing recession and rising energy costs will prolong the slump in corporate profits.

The homebuilders in S&P indexes to a sixth- straight decline after the National Association of Realtors said sales of existing homes declined 1 percent to an annual rate of 4.89 million from 4.94 million in March. The median price dropped 8 percent from April last year, the second-biggest decline ever, as the number of houses on the market surged. With all these gloom and doom there are some serious silver linings. The dollar is yet to make a new low. The lumber futures have formed a base and are taking off with strong commercial interests. Home prices may continue to fall but definitely, the activities are picking up from the deathbed.

The equities have shown some very strong resilience in spite of continuing credit and derivative scandals.

The tech sector is showing signs of recovery. When you put all together, you start seeing the picture clearly. The markets have started their upward journey although most of the actions are stealthy.

Sharply worsening housing recession and rising energy costs ready to rattle the equity market but here is the silver lining
Peter Oberois
When you put all together, you start seeing the picture clearly. The markets have started their upward journey although most of the actions are stealthy.
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Overvalued Derivatives at Merrill signals sign of trouble in financial engineering sector
Sam Adelton
Merrill is downplaying the matter. However, the matter is much more serious. Declines on European and U.S. markets this year have exposed a growing list of errant traders...
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US Government insurance for about $300 billion in troubled mortgages will boost US economy, housing market, lumber futures and US Dollar
Kirsten McLauren
It will produce a phenomenal boost to the US economy, real estate market, the US Dollar, the lumber futures and the new home sales.
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ECB and Bank of England holds rate while shifting bias towards a stronger dollar – US Fed agrees
Sam Adelton
ECB and bank of England ion the next several months will lower artes substantially. At the same time US Federal Reserve will keep rate at the same level. All central banks will inject preferential liquidity to influence higher dollar.
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Asian governments plan to discard international Monetary Fund by creating a $80 billion pool in case of emergency
Media Release
Finance ministers from 13 Asian nations agreed to create a pool at least $80 billion in foreign- exchange reserves to be tapped by nations in case they need to protect currencies.
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US economic downturn decelerating as trade balance stabilizes – bullish for US Dollar
Sam Adelton
At the same time, the data will show that the US trade balance has stabilized and is actually improving. All this is bullish for US Dollar.
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