Markets stabilizing? Housing is last
Following up on last Thursday's development re: European Central Bank moves supporting the US dollar, Barrons has also chimed in on the end of the dollar's slide.
This spring's dollar slide, coincident with global inflation of food and oil prices (very few predicted the $120/barrel Brent crude) impacted consumer sentiment as much as the other crises: credit crunch, recession, etc.
And with the consumer feeling poorer, the housing markets certainly aren't going anywhere.
In this past week, media voices are calling a bottom to some of these crises. Stock markets are stabilizing pending any further evidence of a recession next week. Bond prices fall as investors sense credit crisis easing. The housing markets will only stabilize when the consumer feels comfortable; it's the market that is positioned last in line as other markets begin to recover.
With the US housing market like it is, there is no surprise at the number of real estate investors who are looking outside the US economy for real estate. One of the top markets is certainly the real estate market in Dubai, UAE, where the real estate boom has been hot for the last five years with many economic indicators pointing toward continued growth. My company has produced the www.DubaiMarketGuide.com">Dubai">http://www.DubaiMarketGuide.com">Dubai Real Estate Market Guide for those investors.
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So if the dollar is coming down, the price of oil should drop. The rise of oil has been caused largely by higher demand in China and India, but also by the weakened dollar. China and India have slowed a bit, making demand more stable. With fewer Americans on the road for so many miles because of the high cost of gasoline, demand has dropped. If all of this holds true, the price of crude should come down, especially after the Memorial Day weekend.
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