Comment on the Economy - "Some Interesting Things"

Though this mess has further to go on the down side, some very interesting positive things are happening.

In any economic downturn it is wise to look at the areas which were first to collapse, and watch for indicators of bottoming there. Plus, with all of the government stimulus, flooding markets with capital, there is bound to eventually be some general upturn, its duration all dependent on how long this "window" remains open where there is a global need for US government debt and how solid such a recovery turns out to be - actually putting people back to work, spending and returning tax revenues to the government, etc - a combination of short term and long term measures reinforcing each other - and inflation doesn't get too bad - some is OK, even healthy.

Since the US was the first nation to begin this collapse, since housing was the first section of the US economy to collapse, and since San Diego was perhaps the first US housing market to top out and begin the collapse, it is wise to look at these areas closely, bottom up.

So, I notice San Diego median housing seems to be bouncing around, up a little one week, down a little another, looking for a bottom.Plus, when I look at other US housing markets (I watch HousingTracker.net) and I see many cities up during the last month or so. Probably foreclosures are tempting a lot of buyers, so some kind of bottom is opening. Plus, anecdotally, I see around the LA area, many Chinese investors are coming in to buy homes because they are so reasonable for them. Plus, I see in San Francisco, median home prices are up about 7% in the last month. I see San Francisco being a beneficiary of the administration's goals in restructuring the economy, rewarding science, new technology, education (many good to excellent colleges and universities which will benefit, there, etc).

Plus, commodities have been bottoming. Stocks are at a critical point, but it is too soon to say they aren't looking for a bottom rather than making a further sharp spike down - which is still possible.

I don't want to say the coast is clear, plus some major unforseen event(s) could happen, geopolitically or whatever. Heck, we just had a close call from some asteroid plowing almost head on to the planet.

Plus, the world is looking to the US for leadership and this new administration does have a solid popularity during its first two months, along with a vision, all taken together seems to be supported by most Americans and most world leaders and populations. Sentiment is important at turning points in financial markets. Simply, that is the way they work, on human emotion - at critical points.