Economist's Commentary: May 9, 2008

Quick Take on the Economy: May 9, 2008

By Lawrence Yun, NAR Chief Economist

Exports fell in March, but imports fell by a larger amount, thereby lowering the overall trade deficit. .
The trade deficit was $58.2 billion, down $3.5 billion from a month before.
Exports fell by $2.6 billion to $148 billion. Imports fell by $6.1 billion to $207 billion - largely due to the lower import of petroleum crude oil. Higher energy prices have evidently made consumers think carefully about energy usage.

The House of Representative passed a housing stimulus bill that includes a tax-credit for first-time homebuyer on any homes.
The White House dislikes several aspects of the bill and has said it will veto. The House bill passed by a wide margin of 266-to-154, but not enough to override the veto.
The bill will go to the conference with the House and Senate for tweaking before being sent to the White House.

The first quarter GDP, which showed a 0.6 percent growth in the preliminary reading, will be revised higher. The economy is not in a recession. Jobs will begin to turn positive in few months.
The home buyer tax credit will have a big impact on the housing market and prevent the market from overshooting downward. Bringing the fence-sitter back into the marketplace will help strengthen home prices and lower foreclosures.

This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >

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