Thank goodness this week's t-note auctions are being received well. $41 billion in T-notes were auctioned off today...and another $31 billion will be auctioned off tomorrow.
Dow is DOWN 119 points today... Weaker housing data (Existing home sales reported at 402,000 vs the 438,000 that was expected) and weak earnings reports abroad are some of the factors blamed today.
Another perspective: The market has seen some incredible increases since March. There has been some really impressive gains over just the last several weeks and many analysts felt that a "correction" was coming in the stock market. We hear of an investment getting "oversold". This is when so many people have been buying and supporting a higher value for so long...that the effect wears off and they begin to sell before the value deteriorates again. The selling contributes to further deteriorating values...until the values reach a stable point again and start to grow. This is a "correction". Sound familiar? That is what has happened in the real estate market over the last year or so as well.
Extending the tax credit until April 2010! At least that is what Cavuto reported this afternoon. I went out to see what I could find and found this one at Marketwatch.com:
If buyers have owned their home for 5 years...they can be eligible for a $6500 tax credit. I am not sure if this is going to cease in April 2010 or even if the CURRENT state of the tax credit will go until April 2010...but we will see.
Who pays for this? Hmmm...I suppose we all do. When people pay less tax...there is less money in the coffer.
Perspective: If all the people who would not have otherwise purchased a home are stimulated to purchase: Real Estate pricing continues to stabilize and all the industries propped up by real estate sales continue to get footing in this economy. At some point this has got to stop...and I don't really see yet how the temporary footing will help in the long term...but for now if there is more money being thrown to home sellers, builders, realtors, lenders, furniture and furnishings, home improvement stores etc...it provides real work for real people to support their families. When more money is in our pockets: we tend to eat at our favorite restaurants or buy $4 coffee or otherwise spend money in the economy.
With more money...then we potentially pay more taxes. Granted: maybe not enough directly to make up for $6000-$8000 worth of economic stimulus for each home purchased... However: there are many other things purchased and supported with the purchase of a home as mentioned above. I would be interested to see the stats if it were possible...how much does each home purchase affect the economy?
P.S. A person does NOT qualify for the $8000 tax credit if they are purchasing from an immediate family member. Got this little tidbit today from an accountant friend of Renee Gaugler in my office.
