Retail sales tumble sharply in May - largest decline in 8 months

[mEDITate-OR:

This is a very interesting development, troubling in some ways, but not in others.

Other reports tell U.S. that credit has expanded for durable, large items...

but continuing to drop for credit card purchases.

There seems to be a continuing shift to cut back on retail credit...

but to buy big ticket items that we want or need.

What we do NOT see is a large increase in "savings".

That suggests that due to unemployment and/or insecurity

we are paying down our debts, and buying less.

or, more that we are buying more thoughtfully - DO we need it.

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Retail sales tumble sharply in May

Retail sales suffer largest decline in 8 months

Spending takes a big plunge; consumer sentiment strengthens

A big drop in May retail sales has raised new concerns about the durability of the economic recovery. But consumer sentiment improves to strongest level in nearly 2 1/2 years.

http://www.msnbc.msn.com/id/37635666/ns/business-retail/from/ET

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May meltdown singes pension funds + Euro banks stashing cash under ECB mattress

[mEDITate-OR:

panic like the pension fund for U.S. and EURO banks are...

As you too will read, we do not know quite what to make of this.

Whether or not this will continue, or quickly reverse itself.

What we DO need to remember is that Ins Co & Pension funds are very large investors in RE mortgages - both residential and commercial. IF they have lost a lot of money on those types of RE loans, will they be interested and/or willing to make more of them?  Probably not. That is NOT good news.

The reason why EURO banks are stashing cash MAY be tied to the predictions that they will need to take massive additional RE write offs, soon.

For U.S. bank/lenders are taking on fees wherever and how ever they can - to raise cash.

This might be a different method to address the same problem(s).

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May meltdown singes pension funds

May's stock market selloff was predictably unhelpful for retirement savers.

http://wallstreet.blogs.fortune.cnn.com/2010/06/04/may-meltdown-singes-pension-funds/

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Euro banks stashing cash under ECB mattress

http://wallstreet.blogs.fortune.cnn.com/2010/06/07/stashing-cash-under-europes-mattress/

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Consumer Borrowing Rose in April + Increased $1 Billion

[mEDITate-OR:

wonder if we are doing the Consumption Society thing, again, or not...

Actually, what we appear to be doing is spending wisely, for things we need.

IF we have the money.

But, what we are NOT doing is running up credit card balances !!!

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The strength in April reflected a 7.1 percent rise in nonrevolving credit, the category that includes auto loans. Auto spending has been boosted in recent months by incentives offered by automakers.

Revolving debt, which includes credit card borrowing, plunged 12 percent. That was the 19th consecutive decline in this category.

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Consumer Borrowing Rose in April

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Consumer borrowing increased slightly in April,

http://news.yahoo.com/s/ap/20100607/ap_on_bi_go_ec_fi/us_economy_4

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Consumer Credit in U.S. Increased $1 Billion in April

http://www.businessweek.com/news/2010-06-07/consumer-credit-in-u-s-increased-1-billion-in-april-update2-.html

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GE Capital to shrink real estate holdings by half

[mEDITate-OR:

see that consumer credit co's like GMAC and GE Capital...

who jumped into the RE bubble in a very big way...

bcuz they could make FAR more quick money there

than financing cars and appliances as they had been for years.

They made big money, and they now are loosing big money.

You and U.S. bailed out GMAC, so GM and Chrysler could keep selling cars.

Now, both of them are cutting back, returning to their core business.

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GE Capital to shrink real estate holdings

http://news.yahoo.com/s/ap/20100607/ap_on_bi_ge/us_ge_capital_commercial_real_estate

General Electric's finance arm plans to cut its holdings of commercial real estate by half as part of a broader shrinking of the lending division
reducing its portfolio of office buildings and other commercial properties to about $40 billion, down from the current $80 billion

the division that once made up about half of GE's overall income.

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Without tax credit, home demand keeps slumping + application volume falls 12.2 pct

[mEDITate-OR:

sink, a lot lower, and not understand why...

In Separate news reports we are told that new home starts and permits declined substantially this month. We are also told that existing home sellers are taking their home listings back off the market with the loss of the Buyer Tax Credit.

We are also told that banks/lenders are cutting back on foreclosure starts.

This is the old question:  "It's not if, or even when, it is by how much?"

If everyone in the RE industries are cutting back, knowing that sales will fall substantially, why would you, or anyone, think that they are not going do that.

And be surprised when they do.

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Overall mortgage application volume falls 12.2 pct

http://news.yahoo.com/s/ap/20100609/ap_on_bi_ge/us_mortgage_applications

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Without tax credit, home demand keeps slumping

http://news.yahoo.com/s/nm/20100609/bs_nm/us_usa_economy_mortgages

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Buyer Fatigue Grips the Housing Market

Mortgage Purchase Applications Continue to Plummet

Mortgage purchases sunk for the 5th-straight week to a level not seen since early 1997

Mortgage applications from purchases continued to fall last week by another 5.7%

They're down an amazing 42.4% since the credit expired at the end of April. 

http://www.theatlantic.com/business/archive/2010/06/mortgage-purchase-applications-continue-to-plummet/57900/

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US Home Seizures Jump 44% to Record as All States Show Rise = New Valley foreclosure filings lowest since July 2008

[mEDITate-OR:

not see that as builder are slowing down new construction.

and existing home owners are taking their listing back off the market.

banks & lenders a slowing down foreclosures.

Some may believe that this is progress, but it is not, necessarily.

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• JGBHimself
• Jun-09 @ 10:32 PM

In Separate news reports we are told that new home starts and permits declined substantially this month. We are also told that existing home sellers are taking their home listings back off the market with the loss of the Buyer Tax Credit.

They also told U.S. last week and this that mortgage applications for both purchases and refi's are down - purchase apps at 13 year lows.

Why, precisely, would you expect banks/lenders to continue to flood the RE markets with new foreclosures?

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• JGBHimself
• Jun-09 @ 11:27 PM

Bloomberg, which is very often reprinted by AZRep, tells U.S. today:

U.S. home foreclosures reached a record for the second consecutive month in May, with increases in every state - Bank repossessions climbed 44 percent from May 2009
Arizona had the second highest rate, at one in 169 households, or more than twice the U.S. average.
Ten states accounted for more than 70 percent of all U.S. filings - Arizona (ranked fourth) at 16,097
Maybe if we too were a spin "doctor" from ASU we could like these numbers.

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US Home Seizures Jump 44% to Record as All States Show Rise

http://www.businessweek.com/news/2010-06-10/u-s-home-seizures-jump-44-to-record-as-all-states-show-rise.html

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ASU: Home foreclosure sales declining

http://phoenix.bizjournals.com/phoenix/stories/2010/06/07/daily39.html?surround=lfn

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New Valley foreclosure filings lowest since July 2008

http://www.azcentral.com/business/realestate/articles/2010/06/09/20100609biz-catherine0609.html#ixzz0qQNDF1zy

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May foreclosure rate steadies as banks hold back

http://www.azcentral.com/business/articles/2010/06/10/20100610biz-foreclosurerates0610.html#ixzz0qQP2Bpke

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