Housing Market Still A Drag: Seven And A Half Things To Know

04/03/2012 07:51 am ET
  • Mark Gongloff Managing Editor, Business and Tech, The Huffington Post

Scientists aren't sure, but some think earth may have more than one moon. One thing that is sure is that you need to know seven and a half things each day, and here they are:

Thing One: It's The Housing, Stupid: Why has this economic recovery been so frustratingly slow? It's not much of a mystery, except to those that are trying to make political hay out of it.

The problem is there was a ginormous housing bubble and bust in this country, and those things take time to clean up. All the rest is just white noise. Evidence can be found in the fact that some of the bubbliest housing markets have suffered the most during the recovery, and in some cases show little sign of a recovery at all, writes The New York Times. It's consistent with the core message of the financial-crisis gurus Carmen Reinhart and Ken Rogoff, that big bubbles tend to end very badly, with agonizingly slow recoveries -- a point they make for the one-thousandth time in a new Bloomberg op-ed piece.

It's also a counter to right-wing economist Edward Lazear, who argues in the op-ed pages of the Wall Street Journal that this has been the worst economic recovery in history, worse I guess even than the infamous Sumerian Painted Pottery Bubble and Bust of 2700 BC, which I in no way just made up, and it's all President Obama's fault, because of socialism.

But help is on the way: Investors are looking to buy foreclosed homes by the thousands and become landlords, writes Motoko Rich of the NYT.

Thing Two: Fighting Words: As for Obama, he plans to deliver a speech today, aimed at middle-class voters, blasting the budget plan of Rep. Paul Ryan (R-Wis.). He'll call Ryan's plan a "Trojan horse" for imposing a "radical vision" on the country, the Associated Press reports. In the speech, which he's to deliver at an AP lunch of newspaper editors and reporters, he'll call Ryan's plan "social Darwinism" that would hurt the recovery.

Thing Three: Data Deluge: It's Day Two of our Bataan Data March to the jobs report on Friday. Today we get a report on factory orders for February, which are expected to bounce back from a drop in January. We also get monthly car and truck sales for March. Most importantly, we get the minutes of the latest Federal Reserve policy meeting. Wall Street will read closely for hints of more delicious monetary stimulus coming down the pipeline.

Thing Four: Coty Calling: Iconic makeup slinger Avon Products last night rejected a $10 billion takeover bid by Coty, but its weakness is showing, writes Michael de la Merced of The New York Times: "Now, Avon -- which already faces troubles like a regulatory investigation, declining sales and management uncertainty -- must also convince its restive shareholders that Coty’s unsolicited bid is too low."

Thing Five: Oh, Canada! Royal Bank of Canada is in hot water south of the border (meaning the U.S.). The Commodity Futures Trading Commission has sued RBC, accusing it of engaging in "wash" trades, meaningless trades of futures contracts worth millions of dollars, in order to game the tax system, the Wall Street Journal reports. RBC called the suit "meritless" and "absurd."

Thing Six: Of Clowns And Mind Readers: The head of the General Services Administration, which is sort of the back office for the federal government, handling office space, transportation, cost controls and the like, had to step down after the GSA threw an $800,000 plus conference in Vegas that included a clown and a mind reader, the Washington Post reports: "The episode is an embarrassment for the Obama administration at a time when the role and size of government have taken center stage in the presidential campaign."

Thing Seven: Cable Comeback: Ah, it's just like the late 1990s all over again. The stock market is soaring, the IPO market is booming and fiber-optic cable is getting laid all over the place, reports Anton Troianovski in the Wall Street Journal: "But already some skeptics caution whether enough demand exists to warrant more building."

Thing Seven And A Half: Kentucky Wins NCAA Tourney, In Shocker: In a development that nobody could have foreseen, aside from everybody, heavily favored Kentucky beat Kansas to win the NCAA tournament last night. It was the eighth national championship for the Wildcats, putting them second on the all-time list after UCLA, which has 11 titles. It was also the record-breaking 38th win of the season for Kentucky, breaking the old record of 37 set by, yep, Kansas in 2008. The nation will now resume not caring about college basketball until March 2013.

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