Legislature, Governor Probably Shouldn't Count on Revenue Improvements
As the legislature debates plugging a $166 million shortfall in the Medicaid budget, it seems many legislators are just hoping that revenues improve and that the hole they're digging in next year's budget would just go away.
Yesterday's housing news is one more piece of evidence that a recovering economy isn't quickly coming to the rescue of legislators trying to avoid setting budgetary priorities.
Purchases of new U.S. homes unexpectedly declined in February to the slowest pace on record and prices dropped to the lowest level since December 2003, adding to evidence the industry is floundering.
Sales decreased 16.9 percent to a 250,000 annual pace, figures from the Commerce Department showed today in Washington. Economists surveyed by Bloomberg News projected a gain to a 290,000 rate, according to the median estimate. The median price fell 8.9 percent from the same month in 2010.
Builders are struggling to compete with existing homes as foreclosures add to the overhang of unsold properties and drive down values. The figures underscore the Federal Reserve's view that the housing market "continues to be depressed" even as the rest of the economy improves.
