I recoil when I spot these pea-brained-type headlines: “Consumer Confidence Lifting New-Home Sales.” I am perplexed by the fact that pro-central planning, quantitative methodologists can actually convince otherwise intelligent people that there can exist a “consumer confidence index.” To quote:
The nation’s biggest public home builders are telling investors that new-home sales picked up during the second half of January, reflecting rising consumer confidence, low interest rates and an improving economy.
This same old meaningless paragraph is lazily recast over and over, article after article, as tediously conventional non-thinkers – otherwise known as journalists – shilly-shally their way through the drudgery of received wisdom. The entire WSJ article reads like an “Onion” parody.
The nation’s “biggest home builders” are sucking at the teat of Government-Policy-and-Federal Reserve-Controlled, artificially-low interest rates. They profit from from a coercive monopoly of the money-making function of a banking cartel that exploits a fractional reserve banking system to manipulate the money supply. They benefit from a decades-long, Fannie Mae-sponsored propaganda campaign aimed at convincing the public that home ownership is the means by which Americans can experience the “American Dream.”
The “American Dream,” as originally cast by author James Truslow Adams in his 1931 book The Epic of America, referred to the following: “It is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position.”
“Consumer confidence,” stripped of its hype and progressive aspirations, actually reflects mass consumer stupidity and/or disinformation as regards economics. Housing is not an investment – it is a durable consumer good. Without the government-banking cartel, housing over time, like all other durables, would depreciate in value. Yes folks, your house can be measured by the subjective value you place on it for its utility, but it is no more an “investment” than was your 1992 Ford Escort.
Yet as consumers toss their cheaply-borrowed fiat money into the speculative bubble known as the housing market, they are consistently told by the media and presumed experts that they are “investing” in a “strong” economy. Here are three very consistently dumbass quotes from the very short Bubble Street Journal article, many of which are not shy about pointing to government management of the housing market. Apparently, I am among the few prophets of doom who dare to unwind the verbal diarrhea (“tailwinds”, “growth,” and other dark splatter) that dots the media landscape.
1- “But Sheryl Palmer, Taylor Morrison’s president and chief executive, and other builders said that sales this January were also boosted by better consumer confidence, an easing of mortgage requirements and other tailwinds.”
2- “Yet analysts and builders now point to several factors buoying buyer confidence. The average interest rate on a 30-year, fixed-rate mortgage stood at 3.66% last week, down from 4.32% a year earlier. Job and wage growth have gained momentum in recent months, and lower gas prices have emboldened some buyers. Recent changes by the Federal Housing Administration stand to lower mortgage-insurance costs and down-payment requirements for entry-level buyers.”
3- “The last two weeks have been so strong that the spring is looking really good right now,” said John Burns, chief executive of Irvine, Calif.-based housing research firm John Burns Real Estate Consulting Inc. But, he added, “ there could be a headline that turns this whole thing around tomorrow. It’s just dependent on consumer confidence.”