Assemblyman Brown reacts to proposed state budget

Posted on February 22, 2012 by Steve Royek

New Jersey Governor Chris Christie has proposed a Fiscal Year 2013 State Budget of $32.1 billion. Here is some information on the budget and reaction to the plan from members of the state Legislature, including Assemblyman Christopher J. Brown.

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    Gov. Chris Christie Proposes State Budget –Millennium News

Yesterday, before a joint session of the State legislature Governor Chris Christie delivered his Fiscal Year 2013 State Budget Address. It includes a modest increase in state aid to schools and the largest ever payment into the public workers’ pension system, but it’s two tax-related proposals that are garnering the most attention and Democrats are bashing both of them.

The $32.1 billion spending plan is more than $2 billion above the current budget. It provides $213 million more for schools over last year. The Christie Administration is projecting revenue growth of 7.3% in the coming year. It is with that revenue that the Administration hopes to fund the first phase of the 10% state income tax cut which is expected to cost $183.3 million in the first year. The legislature would need to approve the tax cut.

Assembly Republican Leader Jon Bramnick says, “Governor Christie outlined a fiscally responsible budget that will advance the New Jersey recovery for taxpayers and businesses. The Governor’s budget increases state educational aid to its highest level in history, makes the required pension payment of $1.1 billion, and cuts income taxes by 10 percent. As a result of Governor Christie’s leadership, we have a budget that funds core priorities and provides tax relief for every New Jerseyan.”

http://nj1015.com/chris-christie-proposes-state-budget-democrats-blast-the-plan/

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    Reaction To Governor’s Budget Address — Millennium News

Assemblyman Christopher J. Brown, R-Burlington
“This budget will cut taxes for every worker in the state and will help property taxpayers with the largest state aid payment to help schools offset the property tax burden in New Jersey history. Sound fiscal policies like these have brought New Jersey back from the brink and this budget will hasten the state’s recovery and ability to add good-paying private-sector jobs.”

Assemblyman Scott Rudder, R-Burlington
“Governor Christie’s first two budgets held the line on taxes and helped create 60,000 private-sector jobs. This budget goes further and will give money back to families and businesses at a time when the states we’re competing with for jobs are considering raising income taxes.This budget will reduce the burden on taxpayers and allow businesses to stay in New Jersey and create the jobs we need.”

Assembly Republican Conference Leader Dave Rible, R-Monmouth and Ocean
“Governor Christie’s budget proposal reflects the priorities that are most important to the people of the state – reducing taxes, creating jobs, and reforming education. The governor’s budget reflects his pledge to fund key programs while maintaining the fiscal discipline he established over the last two years.Because of these fiscal controls, Governor Christie is able to present a pro-growth agenda that will create good-paying jobs and ease the burden on taxpayers. Putting New Jersey’s fiscal house in order is starting to pay dividends. Cutting income taxes by 10 percent, increasing educational aid by over $200 million and targeting $350 million in business tax cuts shows the governor is focused on the core priorities of the state.”

Assembly Republican Budget Officer Declan O’Scanlon, R-Monmouth
“Governor Christie’s first two budgets scored significant victories for taxpayers and fiscal sanity and this is the best New Jersey budget I have ever seen. The 10 percent income-tax cut for every worker in New Jersey combined with increases in state aid to our schools and the continuation of business tax cuts means we haven’t taken our eye off the ball and can deliver a broad and balanced approach to tax relief…

Assembly Republican Anthony M. Bucco, R-Morris and Passaic
“The spending plan proposed by Governor Christie shows that the fiscal priorities established over the last two years are now paying dividends. Residents will benefit from the across-the-board income tax cut as well as from the $213 million increase in educational aid. Businesses will continue to grow and create good-paying jobs because of the $350 million in tax cuts that are contained in the new budget…”

Assemblywoman Donna Simon, R-Hunterdon, Mercer, Middlesex and Somerset
“Today’s announcement underlines Governor Christie’s commitment to provide hardworking taxpayers with the relief they deserve while strengthening the opportunities for students across our state. I am encouraged that fiscal discipline over the last two years has allowed us to increase state funding to our schools by $213 million this year. Education funding now accounts for 36 percent of our total budget. This is the largest amount of state money budgeted for education in New Jersey history…”

http://nj1015.com/reaction-to-governors-budget-address/

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    Analysis: Gov banking on a better economy — Gannett News

In declaring that it is the time to make “better choices,” which includes an income tax cut, Gov. Christie believes now in a much better economy for New Jersey. Experts are not so sure.

Observers and opponents, meanwhile, wonder if Christie’s political agenda is shaping the revenue outlook as the governor turns the corner toward his re-election year. Christie said he believes that state tax revenues are going to increase, in total, by 7.5 percent, which includes a 13.5 percent jump in corporate business taxes and a 6.3 percent hike in income taxes.

Assemblyman Declan O’Scanlon, the Republican budget officer, said he was confident that Christie’s projections are solid, and he noted that in the last two years, Democrats called for more spending and were proven wrong by when revenues came in lower.

“It’s a budget based on the facts on the ground, just as the previous ones were,” said O’Scanlon, of Monmouth County. “The folks who were accurate over the past several years — the administration — ought to get credit for having been right and have the credibility (now). “This governor, I bet you, will not have a year in which he overspends,” O’Scanlon added.

http://www.app.com/apps/pbcs.dll/article?AID=2012302210068

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RE/MAX CONNECTION: NUMBER ONE IN NEW JERSEY

Posted on February 14, 2012 by Steve Royek

RE/MAX CONNECTION RANKED NUMBER ONE
IN TOTAL UNITS BOUGHT, SOLD IN NEW JERSEY

Contact: Kevin Bayzath
Phone: (856) 988-1800
Email: kbayzath@aol.com

MARLTON (Feb. 15) – RE/MAX Connection Realtors was the number one-ranked RE/MAX real estate company in New Jersey in 2011 and had three of the top four ranked individual agents in the state.

The three RE/MAX Connection offices – in Marlton, Mantua and Turnersville – successfully closed 1,417 transactions, more than any other multi-office operation in the state, as well as closing more than $218 million dollars in real estate transactions. The company also ranked third statewide in overall agent commissions.

RE/MAX Connection agent Mark Petracci, from the Mantua office, was – for the third-straight year — the state’s number one RE/MAX agent. Joining him at the top of the list were Turnersville colleagues David Beach at number three in the state and Joseph Granato at number four.

Among individual office locations, RE/MAX Connection’s Turnersville operation was second in the state in 2011 with the Marlton office being ranked number five.

“We have always said the best agents in the state work at RE/MAX Connection, the best real estate agency in the state,” said Christopher J. Brown, CEO of RE/MAX Connection. “This year’s rankings, once again, prove that point.

“Our goal is to produce the best results every day for our clients as we help them buy or sell property,” Brown continued, “and we are very proud of this recognition of our collective hard work.”

Three other agents from the RE/MAX Connection Turnersville office also received high honors in the 2011 rankings. John Swartz, at number six, and Christopher McKenty, at number seven, finished in the top 10 in the Team Sales category for the year. In addition, Peter Sklikas received the “First Year Performance Award” as the agent who posted the best sales numbers among those joining RE/MAX midyear.

“While other companies in this economy are having a hard time closing deals, RE/MAX Connection agents have adapted and overcome these challenges,” Brown explained. “Among the new techniques our agents are implementing to do this is our Home Price Protection program.”

Home Price Protection is a financial product that provides a payout to homeowners in the event the relative value of their home declines at the time they sell, regardless of what price the home sells for. It is available exclusively in South Jersey by RE/MAX Connection.

Among other individual honors, a total of 36 agents from the three offices achieved three different sales levels of accomplishment. The highest ranking, Platinum Club status, was reached by three agents from the Turnersville office: Joseph Granato, Christopher McKenty and Peter Sklikas.

Among the 16 RE/MAX Connection agents who achieved 100% Club status:
– Eight were from the Marlton office: Mark Cuccuini, Ines De La Cruz, Ron DiPinto, Bryant Lafferty, Brian Menchel, Yvette Veideman, Rochelle Yanchyshyn and Gina Ziegler.
– Four were from the Mantua office: Brent Grigsby, Scott Kompa, Mark Petracci and Dave Sulvetta.
– Four were from the Turnersville office: David Beach, John Swartz, Michael Walton and Frank Wible.

In addition, 17 RE/MAX Connection agents reached Executive Club status:
– Six from Marlton: Joan Baines, Donna Clyde, Joanne Kim, Dawn McCann, Robert Millaway and Elisa Nicolaci.
– Eight from Mantua: Richard Bradford, Donna Breland, Daniel D’Alonzo Jr., Janet Larsen, James Moller, Jennifer Pagliarini, Antoinette Wessel and Brian Ziegenfuss.
– Three from Turnersville: Colleen Dorrego, Danielle McFadden and Heidi Rommel.

“We are especially proud that, despite there being more people and more homes in other portions of the state,” said Kevin Bayzath, Broker of Record for RE/MAX Connection, “our three South Jersey offices, and our outstanding agents, closed more transactions than the competition.”

RE/MAX Connection – Marlton is located at 1000 Lincoln Drive East, Suite Two, Marlton, NJ 08053. Phone: (856) 988-1800. Fax: (856) 988-8020. RE/MAX Connection – Mantua is located at 140 Bridgeton Pike, Mantua, NJ 08051. Phone: (856) 415-1210. Fax: (856) 415-1291. RE/MAX Connection – Turnersville is at 5701 Route 42, Turnersville, NJ 08012. Phone: 856-228-7990. Fax: 856-228-4433.

All three offices are on the web at www.goconnectionnj.com.

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RE/MAX Connection Realtors accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided, unless that information is subsequently confirmed in writing. RE/MAX Connection Realtors is providing this transmission for informational purposes only. Any views or opinions presented in this email/blog do not necessarily represent those of the company.

The recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.

RE/MAX Connection Realtors, 1000 Lincoln Drive East, Suite Two, Marlton, NJ 08053 www.goconnectionnj.com.

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Naroff Economic Advisors — January Employment Report

Posted on February 3, 2012 by Steve Royek

NAROFF ECONOMIC ADVISORS, Inc.

Joel L. Naroff
President and Chief Economist

INDICATOR: January Employment Report

KEY DATA: Payrolls: +243,000; Private Sector: +257,000; Unemployment Rate: 8.3% (down 0.2 percentage point)

IN A NUTSHELL: “The economy is starting to turn the corner and the labor market is finally becoming a beneficiary of the improving economic conditions.”

WHAT IT MEANS: For months the data were coming in stronger than expected but it was not clear that businesses were willing to loosen the hiring strings. Well, that may be changing. Private sector firms hired a ton of new workers in January and the gains were across the board.

We were not just talking about service sector positions, though there were a lot of those. But while retailers added only about 10,000 workers, manufacturers hired an additional 50,000 people. Construction, wholesale trade, health care, transportation, professional services, temporary help and restaurants all joined in on the hiring binge.

There was some weakness in finance and information services. The biggest cutbacks, though, were in the public sector, as usual. Local education is still suffering the largest brunt of the budget cutbacks. With hours worked and wages rising, income should be up solidly as well. That will add to spending power, which is badly needed.

But the really good news was on unemployment front. The unemployment rate hit its lowest level in three years. There have been three consecutive declines of 0.2 percentage point, a drop that is much faster than anyone expected but not likely to be sustained.

In January, the improvement came despite a sharp rise in the labor force. That was offset by a huge increase in the number of people who say they are employed, showing it was the economy not statistics that are driving down the rate. (Note: The unemployment rate and payroll numbers come from a different survey.)

MARKETS AND FED POLICY IMPLICATIONS: This is the first time in a long time I can talk effusively about an employment report. It was strong in all components. Payroll gains were across the board. The unemployment rate decline resulted from rising employment not a declining labor force. Wages rose as did hours worked. What was not to like? Nothing!

Since the bottom was hit in February 2010, the private sector has brought back almost 3.7 million workers. Clearly, the jobless recovery is no longer jobless. Still, can we expect the good news to persist? Maybe not at the pace we saw in January, but conditions are such that solid payroll gains and a slow steady decline in the unemployment rate are likely to continue.

Unemployment claims are low enough to support further declines in the rate. Improving conditions in the manufacturing and services sector as reported by the Institute for Supply Management argue that the payroll increases can be sustained.

We still face the restraints of weak housing and limited credit so don’t expect economic or employment growth to surge. But it is likely we will see at least 2.5 million new jobs created this year. The unemployment rate could go below 8% by the fall. Those are not spectacular numbers but just a few months ago not very many people had that in their forecasts (I did, which is why I am saying that.)

Investors should love this report but Mr. Bernanke should be wondering why he insisted on saying that rates will stay low for another three years. If this labor market improvement continues, that is not likely to happen.

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RE/MAX Connection Realtors is not a licensed financial advisor and is not providing any financial advice. You should consult with a licensed financial advisor prior to making any financial decisions. RE/MAX Connection Realtors only is providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.

Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.

RE/MAX Connection Realtors, 1000 Lincoln Drive East, Suite Two, Marlton, NJ 08053 www.goconnectionnj.com.

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Naroff Economic Advisors — Fourth Quarter 2011 Productivity/Unemployment Claims

Posted on February 2, 2012 by Steve Royek

NAROFF ECONOMIC ADVISORS, Inc.

Joel L. Naroff
President and Chief Economist

INDICATOR: Fourth Quarter 2011 Productivity/Unemployment Claims

KEY DATA: Nonfarm Productivity: +0.7%; Unit Labor Costs: +1.2%/Claims: 367,000 (down 12,000); 4-Week Average: 375,750 (down 2,000)

IN A NUTSHELL: “As is the usual case, with employment rising, productivity is moderating and that is raising labor costs.”

WHAT IT MEANS: Businesses have worked extraordinarily hard this recovery to restrain all costs but especially labor expenses. They have done so by working employees harder and longer and that has paid off in large increases in productivity and earnings.

Those days are slowly fading as job growth is picking up. The new workers must be trained and at least until demand rises faster, there is somewhat less for each worker to do. Thus, we are now in the normal productivity slowdown phase.

Output by each worker grew in the fourth quarter at less than half the pace posted in the summer period. The biggest decline was in manufacturing, which has been gearing up to deal with rising sales. That sector went from robust increases to decline.

The slowdown in productivity has some major implications for business costs. Worker compensation is rising and even adjusting for inflation, it actually improved at the end of 2012. For all of 2011, productivity rose at the slowest pace since 2008.

If you want to know why consumer demand has not surged, just look at the compensation numbers: Hourly compensation adjusted for inflation fell by 1.2% in 2011. It’s hard to buy more when your spending power is being diminished.

Even with the moderation in productivity, it looks like hiring will remain on the rise. Weekly unemployment claims fell and the trend level has reached a point where the unemployment rate should go down if not monthly, fairly steadily.

MARKETS AND FED POLICY IMPLICATIONS: Usually you have to give up something to get something and that is the case with jobs. As payroll gains accelerate, productivity normally eases, raising business costs but also increasing worker compensation.

That we are seeing that happen should be cheered as the consumer is the centerpiece of this economy. More jobs mean more income and as the unemployment rate declines, wage gains accelerate. That will provide the means to greater consumption and economic growth.

So both the productivity and unemployment claims numbers, when taken in tandem, paint a picture of an economy recovering. The Fed acknowledged that the labor market was beginning to improve but discounted any major drop in the unemployment rate. The accuracy of that forecast will determine the ability of the FOMC to keep rates low until the end of 2014.

I think unemployment rates will fall faster than the monetary authorities do so I expect rates to rise well before that date. Since tomorrow is employment Friday, we only have a few hours to wait until we see how the year started off but not matter what number prints, the decline in the claims numbers does point to an improving labor market that will ultimately show up in more jobs.

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RE/MAX Connection Realtors is not a licensed financial advisor and is not providing any financial advice. You should consult with a licensed financial advisor prior to making any financial decisions. RE/MAX Connection Realtors only is providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.

Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.

RE/MAX Connection Realtors, 1000 Lincoln Drive East, Suite Two, Marlton, NJ 08053 www.goconnectionnj.com.

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Naroff Economic Advisors — December Existing Home Sales

Posted on January 23, 2012 by Steve Royek

NAROFF ECONOMIC ADVISORS, Inc.

Joel L. Naroff
President and Chief Economist

INDICATOR: December Existing Home Sales

KEY DATA: Sales: up 5.0%; 2011 vs. 2010: Up 1.7%

IN A NUTSHELL: “Home sales are picking up steam but with so many contracts failing, it is not clear how fast conditions can improve.”

WHAT IT MEANS: Once again we see that the housing market is slowly coming back. According to the National Association of Realtors, existing home sales rose solidly in December. The pace was the second highest of the year and it was the third consecutive month that demand has improved. The increases were spread across the nation though the Northeast and Midwest did significantly better than the South or the West.

But there were some disturbing developments in the data. The Realtors reported that one-third of the contracts failed to move to sales, many due to the appraisal process. If you cannot get an appraisal that matches the contract price, mortgages cannot be written. With distressed homes sales making up a growing share of total demand and with the process so restrictive, it is difficult in many places for sellers and buyers of non-distressed homes to complete a deal.

That has led to a second trend, a major reduction in inventory. It appears that many homeowners have given up trying to sell and the supply of houses dropped by over 20% in a year. As for prices, with investors making up a growing share of the buyers and with foreclosures and short-sales so high, it is hard to know what the price of a good house is anymore. I don’t even bother looking at the price data.

MARKETS AND FED POLICY IMPLICATIONS: This was another solid report that shows the potential strength of the housing market and some of the reasons for the weakness. People want to buy homes but too often the process makes it too difficult if not impossible to do that.

Both the existing and new home portions of the market are being hurt by the overhang of so many distress houses. For builders, the ability to compete with these cheap homes makes construction difficult. For people not interested in distressed homes, the appraisal and mortgage process can make it impossible to finalize a deal even if the buyer and seller agree on a fair price.

Until this large inventory is removed or at least made less of a factor, don’t look for housing sales to rise sharply. And to the extent that the trend in prices is a captive of the distressed home problem, prices will remain weak, equity will continue to erode and home sales, worker mobility and construction will be limited.

Unfortunately, there is no simple solution to the problem and that means we are in for a long, long period of recovery which will limit growth. While this report supports those who are saying the economy is improving, it also makes the point that some at the Fed are arguing that the recovery remains tenuous.

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RE/MAX Connection Realtors is not a licensed financial advisor and is not providing any financial advice. You should consult with a licensed financial advisor prior to making any financial decisions. RE/MAX Connection Realtors only is providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.

Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.

RE/MAX Connection Realtors, 1000 Lincoln Drive East, Suite Two, Marlton, NJ 08053 www.goconnectionnj.com.

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Naroff Economic Advisors — December employment report

Posted on January 7, 2012 by Elizabeth DiRiego

NAROFF ECONOMIC ADVISORS, Inc.

Joel L. Naroff
President and Chief Economist

INDICATOR: December Employment Report

KEY DATA: Payrolls: 200,000; Private Sector: 212,000; Unemployment Rate: 8.5% (down 0.1 percentage point)

IN A NUTSHELL: “It may not be a lean, mean jobs machine just yet but the labor market is finally starting to pick up steam.”

WHAT IT MEANS: Yes, it is all about jobs. That is not a political comment but a commentary on the missing link in the economic recovery. Job growth affects confidence which in turn affects spending and ultimately the willingness and need of business to add workers.

At least in December, companies began the process of rebuilding their workforces at a decent, though hardly robust pace. The payroll gains were widespread. There were some large increases in seasonal sectors such as retail, warehousing and transportation.

It took a lot of people to meet the strong holiday shopping season and get the gifts to everyone on time. But there were also solid gains in the manufacturing, business services, health care and two of the weakest areas, construction and finance. Declines were posted in the shrinking state and local government sector and strangely in the temporary help industry.

Normally during the holiday shopping season you would expect strong increases in the usage of temps but that didn’t seem to be the case. But the biggest news was the decline in the unemployment rate to its lowest level in nearly three years. It was expected to rise and the continued drop is good news. Some may argue that the downward movement is being driven by a shrinking labor force. Ideally, you want the rate to decline as more people seek work but a much larger number of people find work.

However, the length of the slow recovery is forcing more and more people off the unemployment rolls. They are part of the labor force when they get unemployment compensation but after nearly two years of not finding work, a lot of people simply give up. In essence, they were bloating the labor force while collecting unemployment and now the labor force is better reflecting job search decisions.

Another positive element of the report was a rise in hours worked and hourly wages. That bodes well for income growth, which has to accelerate if demand and economic activity is to pick up steam.

MARKETS AND FED POLICY IMPLICATIONS: This was a better than expected report in all ways: There were more jobs created than most economists thought while the unemployment rate fell instead of the predicted rise.

Unfortunately, we need more like 300,000 jobs to get the unemployment rate coming down consistently and rapidly and that is not likely to happen this year. Also, firms need to grow wages faster if consumption is to accelerate. There is not a lot of appetite to give raises.

So while this is a good report, we need more of them and they need to get a lot better if the economy is to start expanding strongly. Nevertheless, this is another in the long line of positive indications that the economy is starting to come back. Investors should embrace this report but with Iran making threats and Europe a constant worry, who knows where the markets will go.

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RE/MAX Connection Realtors is not a licensed financial advisor and is not providing any financial advice. You should consult with a licensed financial advisor prior to making any financial decisions. RE/MAX Connection Realtors only is providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.

Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.

RE/MAX Connection Realtors, 1000 Lincoln Drive East, Suite Two, Marlton, NJ 08053 www.goconnectionnj.com.

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Naroff Economic Advisors 2012 Outlook

Posted on January 5, 2012 by Elizabeth DiRiego

NAROFF ECONOMIC ADVISORS, Inc.
Joel L. Naroff
President and Chief Economist

The Outlook for 2012

In a Nutshell: “The economy looks to be better in 2012 but we still have to get over the European debt hurdle first.”

What an amazing year. It started out positively as businesses were hiring again, confidence increased and growth seemed poised to change gears. But then gasoline prices broke the critical $4.00 a gallon level and consumers got worried. There was also a divisive debate over the debt ceiling, a downgrade of the U.S. debt, huge market volatility, a devastating tsunami which cut the Japanese supply chain and the European sovereign debt crises. When you come to think about it, the continued growth of the U.S. economy is amazing and shows just how resilient it is.

The economy ended 2011 on a high note. If economic activity is to accelerate, the consumer has to re-engage and that is happening. While growth during the summer was disappointing, households are spending money again. Whether it was Black Friday weekend, Cyber Monday or any other major sales event, the comparisons with 2010 numbers were really good.

Not only were people hitting the malls and wearing out the internet, they were also revisiting the dealerships as vehicle sales picked up. In other words, the long lost consumer is blowing the dust out of the wallet and opening it up.

While economic momentum was building entering 2012, that doesn’t mean strong growth is a given. The current restraints of a soft housing market, fiscal austerity, limited credit and a dysfunctional Washington will not disappear soon. And of course the election campaign can only create more disgust about our elected representatives.

But the real concern is Europe. Greece is bankrupt and other countries are having difficulty meeting their responsibilities. The European monetary union must also become a fiscal grouping but herding the cats is difficult. Not many nations want to give up some of their budgeting freedom even though that is necessary if the Euro is to survive.

Undoubtedly, budget cuts and tax increases will occur throughout Europe and that means the continent is likely to go into recession, if it isn’t already. That will reduce our exports as almost twenty percent of our foreign sales go to that part of the world.

The expectation is that the European Union will manage to do enough to get by even if they don’t do all that is needed. That should prevent a financial crisis. If that is the case, though the impact on the U.S. growth will be felt, it will not be large enough to drive us back into recession.

I am optimistic about 2012 and my forecast reflects that. As long as Congress passes the payroll tax extension, growing consumer spending should cause hiring to rise and by mid-year we could be seeing solid, though maybe not spectacular job gains. That would cause the unemployment rate to decline and by year’s end could drop below 8%. That is way too high but the downward trend would be clear enough that job insecurity would fade and confidence would improve. That would further increase household spending and convince businesses to continue investing heavily.

The growing pace of consumption and capital spending should be supported by the low interest rate policy of the Federal Reserve. While tight credit and restrictive standards may be limiting lending, many households and businesses have refinanced and that is adding to cash flow and bolstering balance sheets. Simply put, firms and individuals will have the money to spend and they are likely to do that.

While there is tremendous uncertainty about the outlook, the pattern of better than expected economic reports clearly points to an economy on the rise. Until housing starts to pick up steam and it is a lot easier to get a loan, don’t expect robust growth to return. But barring a major European meltdown, 2012 should be quite a bit better than 2011.

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RE/MAX Connection Realtors is not a licensed financial advisor and is not providing any financial advice. You should consult with a licensed financial advisor prior to making any financial decisions. RE/MAX Connection Realtors only is providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.

Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.

RE/MAX Connection Realtors, 1000 Lincoln Drive East, Suite Two, Marlton, NJ 08053 www.goconnectionnj.com.

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November Pending Home Sales/Weekly Unemployment Claims

Posted on December 29, 2011 by Elizabeth DiRiego

NAROFF ECONOMIC ADVISORS, Inc.
Joel L. Naroff
President and Chief Economist

INDICATOR: November Pending Home Sales/Weekly Unemployment Claims
KEY DATA: Pending Sales: +7.3%/Weekly Claims: 381,000 (up 15,000)
IN A NUTSHELL: “Most housing reports are looking up but prices are still in the dumps.”

WHAT IT MEANS: It is hard to get really strong growth if home construction remains weak, so any good news about that sector should be trumpeted. So here is today’s blast: Housing sales are beginning to climb. The National Association of Realtors reported that pending home sales, which are contract signings, jumped in November to the highest level since April 2010. Since that was when the government’s “first time, long time” buyers’ incentives were in place, it looks like we are now in the midst of a real, not policy-hyped recovery. Improvement was seen in all regions with the West and Northeast leading the way.
In a separate report, unemployment claims jumped last week. That was expected though the rise was somewhat more that predicted. Still, the trend is down as the four week moving average fell fairly sharply. It is now at a level that tends to signal declining unemployment rates.

MARKETS AND FED POLICY IMPLICATIONS: Most housing data have been coming in better than expected and that is an indication that the log jam is beginning to break. The jump in pending home sales should lead to a further rise in sales over the next few months. With affordability at a record high, if we can only make it a little easier to get a mortgage we just might see the sector show some real strength. Unfortunately, the huge number of distressed houses overhanging the market will continue to put downward pressure on prices and limit the uptick in home construction. Still, this report adds to the belief that the weakest link in the economy, housing, is starting to come out of it.

Next week is a big one as we get the December jobs report on Friday. While the rise in the claims number is a warning that the labor market is still not strong, there are real hopes the payroll numbers will be quite solid. The bigger question is the unemployment rate, which gapped down in November. A modest rise, which is expected, would be a positive sign that conditions are firming and that seems to be the message coming from the claims numbers. So we are ending the year on an up note and I want to wish everyone a

HAPPY NEW YEAR
Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

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November New Home Sales

Posted on December 27, 2011 by Elizabeth DiRiego

NAROFF ECONOMIC ADVISORS, Inc.
Joel L. Naroff
President and Chief Economist

INDICATOR: November New Home Sales
KEY DATA: Sales: 315,000 (up 1.6%); Nov ’10-Nov ‘11: +9.8%

IN A NUTSHELL: “The choices may be limited but the sale of new homes is moving up anyway.”

WHAT IT MEANS: After falling apart in the summer of our discontented Congress, new home sales have been on a steady upward climb. The November pace was just about at its highest level this year. The October number was revised upward and if that happens with November, we could see the rate break that high. Still, the level is ridiculously low and is about one-quarter the pace hit at the peak of the boom. The current sales pace needs to more than double before we can say that demand is decent. With so many distressed homes on the market, developers are “building down”, constructing smaller homes so the price continues to fall. At the same time, though, the supply is being kept under control. Indeed, the number of homes for sale hit the lowest level in the forty nine year history of the data.

MARKETS AND FED POLICY IMPLICATIONS: The recovery in the housing market is under way but it is also glacial. There is not much hope for the new construction segment of the market as long as the overhang of distressed homes remains so high. Still, up is better than down and the remaining builders are probably seeing better sales, at least compared to last year. In any event, it’s time to do some food shopping for the weekend so let me say to all:
Happy Holidays
Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

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November Existing Home Sales

Posted on December 22, 2011 by Elizabeth DiRiego

NAROFF ECONOMIC ADVISORS, Inc.
Joel L. Naroff
President and Chief Economist

INDICATOR: November Existing Home Sales
KEY DATA: Sales: +4.0%; Year-over-Year: 12.2%; Prices (Nov ’10-Nov ‘11): -3.5%;

IN A NUTSHELL: “It turns out the housing collapse was greater than thought but at least the process of digging out from the deep hole is beginning.”

WHAT IT MEANS: The housing market is healing, albeit slowly. Starts are improving and now we see that existing home sales are on the rise. Demand rose solidly in November led by a jump in single-family activity. Condo purchases were flat. The gains were across the nation though there was nearly a double-digit rise in the Northeast. So far in 2011, total sales are running almost two percent above the 2010 level. The increases were pretty evenly distributed between the single-family and condo markets. That said, the level of demand is unbelievably low. The National Association of Realtors revised the data for the period 2007 through 2010 and reduced total sales by over 14% or by about three million fewer sales. In other words, the meteor that cratered the housing market was a lot larger than initially estimated. And you thought the dinosaurs had problems. The reduction is in synch with the larger decline in GDP during the recession that was reported by the Bureau of Economic Affairs. As for prices, they are continuing to slide and for the first eleven months of the year, the median price has dropped nearly 5%, again with condos down a little more than single-family units.

MARKETS AND FED POLICY IMPLICATIONS: While some may concentrate on the huge downward revision to sales, the real story is the current trend in housing demand and that seems to be up a little. When you look at growth, it is the change in activity not the level of activity. Sales bottomed in July and have been moving up fairly steadily since. Unfortunately, the large number of distressed homes being purchased is reducing not only sales but supply as well. People with well-maintained homes know they cannot get their desired price, even if buyers are willing to pay it, as long as distressed homes are used as comps. It looks like these “normal” homeowners are simply keeping their houses off the market and that is reducing the number of homes for sale. That makes the supply of homes number somewhat useless as it implies that once conditions turn around, the ‘for sale’ signs will pop up like crazy. The latent supply is there, the actual supply is not. Regardless, this is another positive report that should make it clear that the economy is heading into 2012 with growing momentum. Unless Europe crashes and burns, and never underestimate the ability of politicians in any part of the world to do the wrong thing, growth in the U.S. next year could be decent. That is my forecast and I am sticking to it, at least for now.
Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

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