Events European and domestic have conspired to push the Almighty Indicator to its lowest level in six months: the 10-year T-note has broken to 3.05 percent.

April data still arriving shows a substantial air pocket, which the usual suspects discount as the temporary effect of gasoline prices and supply-chain disruptions after Japan’s March 11 earthquake. There’s more to it than that: the Chicago Fed’s national index dropped from +0.32 in March to -0.45 in April, and -0.7 would signal new recession. First-quarter gross domestic product was widely expected to be revised up from 1.8 percent but was not, and the consumer spending account was revised down a half-point. Last week’s new unemployment claims were supposed to unwind a quirky rise, but popped up to 424,000.

The song on the broken record here: housing. April pending home sales tanked 11 percent (versus -1 percent forecast), down 26 percent year-over-year. The Federal Housing Finance Agency reported that as of March, homes in 47 states plus D.C. had lost value in the last year, and national prices are back to 2003 levels. Housing is not waiting for jobs; this economy cannot heal when the entire nation is worried about its most important asset.

Europe. To understand this moment in Europe, watch HBO’s new "Too Big to Fail." The presentation is better than the book — better than any of the books or news shows describing the run-in to Lehman and AIG. The splendid cast nails the characters, and conveys the visceral fear that overtook each of these immensely powerful personae.

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