Reply #37: UIA..your link also had Fleckstein's interesting comments about Bush/polls

[KoKo]

economy. The link at the top.

http://moneycentral.msn.com/content/P92948.asp

Housing: a reprieve from reality
Folks who've been paying attention know the economic data have been slipping since last spring. Considering this fact, I would have expected (and did expect) that the dollar would be under more pressure than it has been -- and stocks might be, too. Therefore, it has taken longer for the "next time down/post-stimulus" trade to start working. I've been wondering why, and in particular why the dollar has hung in there as it has.

My conclusion is related to why I think President Bush has been able to hold his position in the polls, despite what's happened on the economic front. (This is an economic comment, not a political one, as I am not a fan of either Bush or Kerry.) The housing market has been holding up. That’s made people feel good, and the byproduct of the housing-as-ATM-funding vehicle has continued to help them live beyond their means.

I may be totally wrong about this, but I think that housing has enabled people to feel better about the economy and where we're headed than my reading of the data suggests would be possible.

That said, given the early signs of trouble building, I still believe that the economy, the stock market and the Fed's credibility are on borrowed time. The problems that I have outlined in the past about the next time down/post-stimulus trade await us in the future. However, this scenario appears to have taken longer to unfold than I would have guessed, based on the data.
http://moneycentral.msn.com/content/P92948.asp