By MARTIN CRUTSINGER, AP Economics Writer
28 Jan 2008
WASHINGTON - New home sales plunged in 2007 by the largest amount on record while home prices tumbled sharply in December. Analysts forecast more trouble in 2008 as housing tries to emerge from its worst slump in more than two decades.
The Commerce Department reported Monday that sales of new homes dropped by 26.4 percent last year to 774,000. That marked the biggest decline on record, surpassing the old mark of a 23.1 percent plunge in 1980.
Boy, I'm sure glad the economy is fundamentally strong and just facing a few minor uncertainties!... otherwise this might be really worrisome!
Business cycles are real. Sane government policy attempts to mitigate the unwelcome effects... not magnify 'em!
[As it turns out, I've some familiarity with bizarre feedback loops at a micro-economic level: I've witnessed first-hand a Fortune 500 company whose business systems act to amplify fluctuations in the prevailing economy - pretty much the opposite of what is desirable, which would be to dampen the effect of external economic swings!... I'm at a loss to explain this behavior.]
Will we see Clinton's 1992 slogan returning?
"It's the economy, stupid!"Stop the madness!
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