Housing bears have had this date, August 24th, circled on their calendars for many months. Today we received the existing home sales for the month of July. July was the first full month with no artificial juicing from the home buyer tax credit. In other words, it is a real look at the housing market.
The numbers were beyond catastrophic.
Homes sales fell 27.2% and fell to the lowest level since May 1995. The following chart says it all:
With sales non-existent in July we are now at a 12.5 month supply of homes on the market. Anything above 6 months is considered dangerous. The chart below shows the current inventory:
This does not include the "shadow" supply of foreclosed homes that banks are (currently) holding off the market. The Case Shiller home price index works on a two month lag so we should see the plunge in home prices by September/October.
The sales number this morning has rocked the stock market and has also inspired further calls for additional quantitative easing (money printing) from the Federal Reserve.
Gold and Silver went vertical upward on the rumors. As the Fed does its best to destroy the country, and the recovery never comes, it now appears we will become a country of those that hold precious metals, and those that do not.