Home Prices Fall

" Let's get into home prices they continue to tumble in March joining me now with a closer look at the Case Shiller numbers is buying -- very. He's with first trust portfolios chief economist -- we just saw that he Shiller numbers come out not just bring that up with Kristen. That's down basic basically no evidence of recovery in fact the three hardest hit happens to be one of the areas here which is in New York. You surprised by those numbers are not."

" But not really I -- they came in very close to consensus we've. Well we've seen as a bottoming here process they're not accelerating in their decline. They've actually slowed down and and while there's no evidence yet -- recovery is is in the eyes of the beholder right we want to see a pick up in these numbers. And as of yet we haven't seen that but they are bottoming and we need to bottom before we go up so. From my perspective that's pretty good knows."

" You know find -- you we've talked a lot and you've been pretty bullish about the markets are you still fairly bullish that we're moving toward a recovery."

" Absolutely. I'm back I. I have been him in the stock market's up over 30% in the past couple of months and I think what we've seen is all kinds of numbers. Get better I mean retail sales it's. I know it's a phrase that people use people aren't spending that's just not true in fact retail sales are up this year from where they were in the fourth quarter. We've seen initial claims peak. Credit spreads which are one of the key like almost thermometer they're they're the that the measuring stick of risk taking credit spreads have come back down two years swap spreads Ted spread Libor has come down. All of these things tell me that what we're beginning to see is that this market is on freezing. And we're seeing a bottoming process and a lot of numbers and and that's very good I think we're going to see a positive third quarter GDP number and we look back the second quarter of this year which were just act sitting right now. Is going to be the the bottom in the economy."

" You know Brian I want Kristen to interject here for a second can see she had a point glad Crescent -- say they have what are it's not the the consumer isn't spending at all I think it's more -- look at what they're spending on and if we saw the right the last batch of retail sales numbers that came out last week were chatting. On children's place Jean Marie. People are starting to spend on their kids first then we'll spend the high teens and then -- to start spending on sound salon that's so. I -- your point there is warming trend. But I don't -- becoming hot anytime soon although I want I think."

" it and look what a lot of things that you mention and are all signs perhaps that things aren't going to get worse but the navy they've. -- flat line to -- weakly clay Wright still north of 600000 -- highest continuing claims number that we've had since the forties -- still I think without get a look. Pretty abysmal."

" Yes that's true but things always look the worst at the bottom and by the way they always look the best that the top of me go back to. 1999. Early 2000 and initial claims were in the 200 and if you would have just looked at that he said there's no way we could have a recession. And yet we dead and so. What happens all the time is when economies go through these cycles at the bottom it looks the worst of the top it looks the best and if you just base it on -- contemporary. Data you're gonna always missed the turning point and I think what we've seen is enough. Pieces of data begin to turn. You know when the Fed prints all of this money when they're injecting this kind of liquidity the economy can't help. But go up and that's what I think is happening here were floating. On a scene you know what would it be and that's going to drive the economy."

" Here's the only thing Brian yeah I had a conversation about this it this morning in terms of what we can expect this summer. And if you know normally Summers volumes get light markets are slightly -- not phenomenal. Here I think. Public policy right now what's coming had a they help. It's going to make some decisions on regulatory overhaul impact -- health care industry impact in the energy sector. And you are you not concerned at what comes -- DC. Could be either paying that actually rattle the market."

" absolutely Alexis it worries me a great deal and when you put on nationalized healthcare cap and trade. More government or federal government spending not to state and local on education higher tax rates. More regulation all of these things will damage our entrepreneurial spirit. But I see that it actually hitting us in a couple of years so. My model for right now it's kind of like 197576. And who went even in the midst of a lot of bad policies we had a boom in the stock market and it was because the Fed was so easy. So I'm looking at the next twelve to eighteen to 24 months of being a boom because the -- so easy but if we get these policies passed we won't pay a price. It will just come down the road. In a couple of years great."

" Point aren't flying must very first trust portfolio chief economist -- is buying continued thanks so much. Great to -- you elects."