PAY ATTENTION

S&P/Case-Shiller Index Says U.S. Home Prices Fell in April for 17th Consecutive Month

NEW YORK (AP) -- U.S. home prices fell for the 17th month in a row with all regions showing the effect of the housing slowdown, according to a housing index released Tuesday by Standard & Poor's.
For April, the S&P/Case-Shiller index that covers 10 U.S. cities fell 2.7 percent from a year ago. It was the steepest decline since 1991.

If you have been reading my blog for some time, you know I WILL be paying attention. Business not DOA, and in future many potential drivers of global economies, but a BEAR MKT could be lurking in the way. LIQUIDITY IS SLOWLY DRYING UP< IMHO

D

SLOWING HOME SALES, RISING INVENTORIES

Home Sales Trend is Worrisome Last Update: 25-Jun-07 10:12 ET

The housing market remains weak. Existing home sales for May were essentially flat at -0.3%. That was in line with expectations, but it still represents a very low level of sales. Sales are 10.3% lower than a year ago and the lowest level in three years. The median price on existing homes sold was down 2.1% from a year ago, continuing the decline of recent months.

The outlook is not good. The inventory of unsold homes rose to a very high 8.9 months supply. Mortgage rates have also risen in recent weeks with the backup in the 10-year note yield. This will hurt demand in the months ahead. A higher level of supply, and lower demand is obviously not good for the housing market. The housing market remains a significant problem for the overall economic outlook.
--Dick Green, Briefing.com

SING-A-LONG WITH DOW

Going Down by Jeff Beck

album: Best Of Beck (1999), Beckology (1998)

Well I'm going down
Down, down, down, down, down
I'm going down
Down, down, down, down, down
I've got my head out the window
And my big feet on the ground

She's gone
Gone, gone, gone, gone, gone
She's gone
Gone, gone, gone, gone, gone
I've got my head out the window
And my big feet on the ground

So I'm going down
Down, down, down, down
I'm going down, down, down, down, down
Down, down, down, down, yes I am
I've got my head out the window
And my big feet on the

Well I'm goin
Down, down, down, down, down
I'm going down
Down, down, down, down, down
I've got my head out the window
And my big feet on the ground
Gone
Gone, gone, gone, gone, gone
She's gone
Gone, gone, gone, gone, gone
I've got my head out the window
And my big feet on the

Well I'm Down
Down, down, down, down, down
I'm going down
Down, down, down, down, down
I've got my head out the window
And my big feet on the ground, yes I have
Well she walked out the door
And I crawled right out there

NOOSE TIGHTENS?

NEW YORK (AP) -- Bear Stearns Cos. confirmed Friday it will bail out one of its troubled hedge funds with $3.2 billion in secured loans, but the Wall Street firm sought to convince the broader market its troubles are "relatively contained."

Bear said it stepped in to save the Bear Stearns High-Grade Structured Credit Fund because market uncertainty made it "difficult" to unwind the fund's assets -- mostly securities backed by risky mortgage loans.

Blackstone went public today, is this the height of GREED? CEO'S value near $7B ! nice payday, the rich get MUCH RICHER the rest get much more in debt.

This country is bankrupt with NO way to pay off debt nor pay for promissed benefits.

WE are into Chinese for $1.4 Trillion, and that comes with interest!!! They put $3B in Blackstone pre IPO ! Does this event mark watershed?

Most indexes challenging their 50 EMA (moving averages), UTILITY AVG broke down to new low for move. ALL indexes seem to be moving together to the downside.

This decline MAY HAVE TEETH, not saying one last run to new highs not possible.

Interest rates broek a trendline from 1981 !!! many think BOND BULL IS DEAD. How do stocks normally react in a rising interest rate environment?

I am IN CASH awaiting bargains, watching gold for possible breakout.....or breakdown.

Down market closing on lows with BX IPO today, not good IMHO!

D

APPEARENCES CAN BE DECIEVING

Castles Made Of Sand Lyrics » Jimi Hendrix

Down the street you can hear her scream "you're a disgrace"As she slams the door in his drunken face,

And now he stands outside and all the neighbours start to gossip and drool.He cries "Oh girl, you must be mad,What happened to the sweet love you and me had?"

Against the door he leans and starts a scene,And his tears fall and burn the garden green.And so castles made of sand, fall in the sea, eventually.

A little Indian brave who before he was ten, played war games inthe woods with his Indian friends, and he built a dream that when hegrew up, he would be a fearless warrior Indian Chief.

Many moons passed and more the dream grew strong, until tomorrow He would sing his first war song,And fight his first battle, but something went wrong,Suprise attack killed him in his sleep that night

And so castles made of sand, melts into the sea eventually.

There was a young girl, whose heart was a frown,Because she was crippled for life, and couldn't speak a sound

And she wished and prayed she would stop living, so she decided to die.

She drew her wheel chair to the edge of the shore, and to her legs she smiled"You won't hurt me no more.

"But then a sight she'd never seen made her JUMP AND SAY"Look, a golden winged ship is passing my way"And it really didn't have to stop...it just kept on going.

And so castles made of sand slips into the sea, Eventually

BDI FLASHING RED

BDI is a helpful tool is guaging what the world economies are up to, there is a good chance it has topped out, flashing another caution flag.

If 10 yr breaks and holds above 5.25%, that would become support for perhaps even higher rates.

D

NOT OUT OF WOODS, MORE PAIN

Foreclosures jump 90% over last year
Figure pushed up by slowing real estate market, subprime meltdown.

June 12 2007: 5:29 PM EDT

NEW YORK (Reuters) -- Home foreclosures in May jumped 90 percent from a year earlier, reflecting a poor spring housing market and foreshadowing even higher levels later in 2007, real estate data firm RealtyTrac said Tuesday.
The May foreclosures - a sum of default notices, auction sale notices and bank repossessions - totaled 176,137, up 19 percent from April, the firm said in its May 2007 U.S. Foreclosure Market Report.
"After a barely perceptible dip in April, foreclosure activity roared back with a vengeance in May," James Saccacio, chief executive officer of RealtyTrac, said in a statement.
"Such strong activity in the midst of the typical spring buying season could foreshadow even higher foreclosure levels later in the year," said Saccacio. "Certainly not every community nationwide is seeing an increase in foreclosures, but foreclosed properties are becoming more commonplace and adding to the downward pressure on home prices in many areas."
RealtyTrac said there was a national foreclosure rate of one foreclosure filing for every 656 U.S. households during May.
The default rates in the subprime segment of the U.S. mortgage market, which caters to borrowers with poor credit histories, have jumped in recent months as the housing industry has slowed and prices have fallen.
More than two dozen lenders in the subprime mortgage sector have collapsed as rising defaults drove them out of business during a downturn in the housing market.
Market observers are keeping a watchful eye on the subprime crisis because it has triggered broader concerns that the fallout may spread to mainstream lenders and damage the economy.
A slowing housing market affects homebuilders, such as Centex (down $1.18 to $44.09, Charts, Fortune 500), Hovnanian Enterprises (down $0.86 to $20.31, Charts, Fortune 500) and Pulte (down $0.74 to $24.65, Charts, Fortune 500), as well as banks that make mortgage loans, such as Bank of America (down $0.39 to $49.66, Charts, Fortune 500) and Wachovia (down $0.65 to $52.95, Charts, Fortune 500).
Home prices: More pain to comeStudy: Rust Belt sees highest foreclosure riskMortgage applications hit by rates

POTENTIAL TITANIC EVENT

http://www.tradertalk.net/tutorial/titanic.html

10 yr has broken 5.20%
Certain forms of liquidity are drying up.
SPX fighting to hold above 1500.

D

CRACKS IN THE ARMOUR?

Mortgage Rates Hit 10-Month High AP
Growth in Consumer Credit Slows in April AP
Stores Post Modest Sales Gains in May AP
10-Year Treasury Yield Passes 5 Percent AP

At some point the lemmings sit up and take notice, not one thing, not the CHinese stock swoon, not sub prime mess, not gassed out housing, not 15 Million Mexicans sneaking under the fence, not an idiot for President, not historic highs in energy prices, not ongoing mess in Iraq, not gay priests, not the thought of HIllary as President?

The 10 yr busting out over 5% has got someone nervous, and now is a great place to take profits perhaps thought some others.

Little guy already grumbling that the market hasn;t gone up every day let alone fell by 200 points.

We had close to 90% DOWNSIDE VOLUME TODAY!

UTILITY stocks battered and broken support (they fell ONE YEAR IN ADVANCE OF 2000 TOP), higher rates will do that. 500 is price I am looking at as must hold. Closed today at 517. 509 is 200 EMA. could bounce there. (very near a sell signal of 20 /50 EMA cross)

SELLERS were in control, volume high and buyers nowhere to be found cept for AAPL stock.

Retail sales in general are very quiet. GDP had near qtr of no growth, costs pressures are there, inflation pressures there, BONDS were NOT safe haven today.

Corrections are not unusual during bull markets, I think this is first big test in awhile.

D

FOOLS GOLD?

(**click image to enlarge)

You spends your money here, no big deal? Is there reason to see the bull cycle since 2002 lows for what it is in relation to real money? I think there is, not so impressive, in fact impotent.

Only Utilities not confirming this move. Market is RIPE for correction before making any more meaningful headway, most services plainly bullish.

Gold heating up, maybe a trade, I see it as counter move so far.

D