One really wonders if there is any adult supervision in the department where CNNMoney's business headline emails originate.
There certainly isn't much knowledge of the general business environment or of the recent history of the housing market present, because if there were, the following email would almost certainly never have been published -- or if the message had somehow escaped by accident, it wouldn't have taken more than a half-hour to "correct" it. The original and the "correction" follow the jump:
Here's the original:
Here's the "correction":
The real news, and the correction which should have been issued, is that the Case Shiller Index hit its highest level in almost two years -- not nine (zheesh). The blather in the "correction" about 2003 is relatively unimportant. Given the dubious, ignorance- and/or agenda-driven history of this headline service, it's not unreasonable to believe that the CNNMoney folks concluded that mentioning only a two-year high wouldn't do Dear Leader much good.
More broadly, I believe the press is placing far too much emphasis on Case Shiller compared to other indices, particularly the one published by the Federal Housing Finance Administration, which showed a July increase of only 0.2%. Case Shiller only looks at 20 cities metro areas which have roughly 40% of the nation's population and has historically been far more volatile. The FHFA index has the handicap of only reporting loans either owned or guaranteed by Fannie Mae or Freddie Mac, but at least it is nationwide in scope, and thus probably a better indicator of nationwide conditions in the housing market.
While the Case Shiller rise is nice, it doesn't, as the LA times claims, "put real estate on its most stable ground since crashing five years ago" -- unless, as the Times reported, "private equity investors and big hedge funds ... scooping up cheaper homes in the nation's hardest-hit areas" represents some kind of desirable "new normal." It certainly doesn't herald the return of a normal single-family home market.
Cross-posted at BizzyBlog.com.