Living in a 'pretend' recovery

Commentary: International politics, financial policies in flux

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The financial world is gradually relaxing from immediate fears of Japan and the Middle East. As stocks recover some of their fright losses, bonds are as usual the reverse: the 10-year Treasury note is back up to 3.4 percent (from 3.55 percent pre-panic, and 3.15 percent in panic mode); mortgages didn’t move much and are still hanging in just below 5 percent.

The failure of these markets to snap all the way back is a reasonable reflection of new economic data. February orders for durable goods surprised on the far downside: Expected to rise 1.1 percent, they fell 0.9 percent, and there was no distortion by volatile sectors.

Housing data are numbing. Sales of existing homes were forecast to fall 4.5 percent in February, but dumped 9.6 percent, the median sales price down to the $156,100 last seen in 2002.

The guesstimate for sales of new homes was a rise of 1 percent, and instead they collapsed 16.9 percent from January, falling 15 percent year-over-year to an annual rate of 250,000 units, the lowest since records began.