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Break out the Champagne?
Location: Blogs Russ Henke |
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| Posted by: Russ Henke |
5/27/2008 4:54 PM |
On Tuesday May 27, 2008, the price per barrel of oil dropped from the mid-$130’s that it “achieved” last week, to end trading below $129. Hallelujah?
Well, maybe not! Just as General Petraeus recently warned us all to keep the champagne in the back of the fridge when it comes to IRAQ, maybe likewise we’d better hold off on the “economic toasting” for awhile.
Because the latest economic news is not good, my friends.
While the price of oil did close down a few percentage points on May 27, US average gas prices hit another record high at almost $3.94 a gallon of regular, according to a survey of stations by the AAA and the Oil Price Information Service. Now, enterprising thieves have added puncturing gas tanks and gas lines to steal gasoline to their previous nefarious methods of either siphoning gas, or just driving off without paying after fill ups at gas stations.
While the Dow ticked up a tad (+0.6%) on May 27, the Dow lost a startling 3.91% just last week — its worst showing since February 2008. Other indexes showed similar declines.
Also on May 27, The New York-based Conference Board reported that its Consumer Confidence Index dropped to 57.2, down from a revised 62.8 just last month. The May reading marks the fifth straight month of decline in US Consumer Confidence and is now lower than it was during Bush 43’s first recession in 2001. In fact, it is the lowest reading since the index registered 54.6 in October 1992 – you know, 16 years ago, when the US economy and the citizenry were suffering during Bush 41’s recession.
The downbeat news about Consumer Confidence arrived May 27 just as we also received apparently mixed news about the US housing market. The Standard & Poor’s/Case-Shiller index released May 27 showed that US housing prices dropped during Q1 2008 at the sharpest rate (-14.1%) in two decades, indicating that the US housing slump is still worsening. This index is now at its lowest level since its 1988 inception – you know, the year Bush 41 was elected.
Meanwhile, the US Commerce Department reported May 27 that new US home sales unexpectedly rose 3.3% from March to April. It was the first increase in six months and might seem like a harbinger of happier days ahead. But perhaps the May 27 housing news isn’t “mixed” after all! April's new home sales looked better mostly because of a large downward revision to the March 2008 numbers! And the median home price fell 4.2% last month. Alas, even after the slight uptick in April 2008, sales of new US homes are still at their lowest level in 17 years.
No, better keep that champagne in the back of the fridge for awhile. That is, if you can still afford to pay the electricity bill.
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