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September 27, 2005

Confidence waning, Tues., Sept. 27, 2005, 5:02 PM

Consumer confidence is reported at 86.6, which was well below the expected number, and new home sales dropped -9.9% M/M to 1.237 million units, a concern for real estate investors and also a clear sign that an ill wind is blowing in capital markets.

You don't have to be a weather forecaster to be able to forecast that high energy costs and the prospects of higher interest rates are scaring people and that they are going to pull their money out of stocks and bonds and perhaps some real estate investments.

For three days in a row, bond yields have risen because of the weakness in bonds. I suspect it will get worse. At some point, equity traders will throw in the towel.

Posted by Posted by Bill Cara on September 27, 2005 05:02:52 PM | Category: Cara Today in the Market