The Grass is Greener on the Other Side of the Atlantic…
Over the past week the domestic markets have taken a beating over troubling macro-economic data. On Tuesday, existing home sales were reported to be 3.83 million, 33.85% below April 2010 and the lowest ever recorded by a considerable margin (the previous low, in the aftermath of the subprime crisis, came to 4.53M). Traders across the world took the news badly, and the S&P 500 index closed the day down 1.45%.
The next day was even worse: new home sales for July were down 12.4% to 276K, once again the lowest level ever recorded. But whereas existing home sales data only began in 1999, new home sales records stretch all the way back to 1963. Further, the house price index was down 0.3% MoM — lower prices and still lower sales? That’s bad news.
Luckily for traders, and for the American economy, good news and better fortunes can be found if we are willing to look eastward to the Atlantic...and beyond.
No, we are not talking about “The Situation” from the Jersey Shore’s $5m paycheck, we are talking about Western Europe.