Today’s economic news continues to be grim. One in eight Americans are now late in their mortgage payments. That’s right, 12.8% of all are in arrears. Mortgage delinquencies had been on the decline, but rose for the past two months.
Also terrible is the new home sales number. It was down .7% and kicks in at 298,000. That means that on an annualized rate, that’s all the new homes purchased in the entire country this year. It is on pace for the worst performance ever.
Bloomberg economist Joseph Brusuelas explains, “Housing data over the past three months indicates that there is little appetite in the consumer sector to take on the risk of purchasing a home at a time when prices are likely to decline further.”
But wait, there’s more. Last week we had the Philly Fed gauge economic activity in the Northeast. It had contracted to a -30. Today, the Richmond Fed reported activity in the Southeast. It contracted, too, from a -1 in July to -10 in August.
Zero Hedge blog says that the bad housing numbers and bad Richmond Fed “seal the recessionary deal…As Bank of America (RIP) said yesterday, one false word out of Bernanke on Friday and we will see what could possibly be the most epic market crash ever. For those wondering why stocks surged on this horrible news: look no further than the central planers in the Marriner Eccles building who are now expected to do ‘the right thing’ for stocks.”
The right thing means QE3 and the Fed printing more money. No wonder gold is at 1888 at this moment.