Confusion: Home Sales and Home Ownership

On July 26, the new home sales numbers were released and Bloomberg news reported it this way:

"Purchases of new U.S. single-family homes rose in June to the highest level in more than eight years, indicating a firm and resilient housing market."

Keep in mind the words "firm and resilient" when looking at the following. This chart was based on home ownership from St. Louis Federal Reserve and was released just two days later than the above:

Click on Image to Enlarge or See Link Below

In my opinion, you can't have home ownership falling to a level not seen since 1965, and still, somehow, claim the housing market is both "firm" and "resilient".  This seems quite confusing.

References:

New-Home Sales in U.S. Jump to Highest Level Since February 2008: http://www.bloomberg.com/news/articles/2016-07-26/new-home-sales-in-u-s-jump-to-highest-level-since-february-2008

Federal Reserve: Homeownership rate: https://fred.stlouisfed.org/series/RHORUSQ156N#

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Obama is the Gun Industry's Best Salesman

In 2009, the Congressional Research Service estimated that Americans had 310 million firearms.  Since then, and since Barack Obama has been in office, there have been 129.6 million background checks conducted; with the vast majority done on new weapons being sold.  Thus, under Obama's watch, there has been a 42% increase in the number of guns purchased in just 7 years.  Quite the record.

Smith & Wesson, Remington, Ruger and the rest of the gun manufacturers are really going to miss this President when he leaves office next January.  Of course, he still has another year before that to improve on his 42% record.  Probably close to 50%. 

References:

Number of Guns in U.S.: https://www.google.com/search?q=number+of+guns+in+the+u.s.&ie=utf-8&oe=utf-8

FBI Background Check Statistics: https://www.fbi.gov/about-us/cjis/nics/reports/nics_firearm_checks_-_month_year.pdf

Smith & Wesson stocks peak, gun sales rise amid Obama's actions on firearms: https://www.rt.com/usa/328037-smith-wesson-gun-stock-sales/
 

Have U.S. Sales Of Electric Cars Peaked?

In the years 2010 and 2011, Americans only bought a total of 17,425 electric vehicles (EV's).  The following year, 3 times that amount were sold; putting another 52,607 on the road.  In 2013, that number was almost doubled to 97,507.  But in 2014, Americans only bought 25,542 more EV's than they did the year before; bringing the total sales for that year to 123,049.  Even so, that number represented 38% of all worldwide sales of EV's.  

However, 2015 is a completely different story.  In the first 10 months of this year, only 92,347 cars were sold.  Compared to the same period in 2014, this represents a decline of 8,018 vehicles  sold; year-to-date.   Also, America's 38% of all sales in 2014 fell to just 25% of the worldwide sales in 2015.  So, obviously, the slowdown is isolated to this country.

While a one-year decline doesn't make a trend, it could be the beginning of one.  That reality is reinforced by the fact that the growth in American EV sales has been slowing each year.  Certainly, as an all-around vehicle, electric cars are pretty impractical with limited range. Couple that with the knowledge that you have to find a place to charge them whenever you run their batteries down. Another reason may be that the price of gas has fallen from $3.76 a gallon in May of 2014 to the lowest price since 2006 at $2.39 in October of this year.

It will be interesting to see if the decline of sales continues.  Also, when it comes to saving the planet, putting less than 400,000 cars on the road since 2010 is hardly a "green" winner in a country that has more than 254 million passenger cars.  Additionally, the tax payers are on the hook for nearly $3 billion federal dollars since 2010 from handing out $7,500 subsidies to just 383,000 buyers of EV's; mostly a bunch of wealthy environmentalists.  $3 billion dollars is a hollow effort to save the planet.  Further, when people decide to trade-in their old EV's, they find that they take a big financial hit  since there is little demand for used ones.  There's no rebate and the fact that someone might have to replace a very expensive lithium ion battery is quite a turnoff.

References:

Monthly Plug-In Sales Scorecard: http://insideevs.com/monthly-plug-in-sales-scorecard/

Electric Vehicle Incentives: http://www.teslamotors.com/support/incentives

U.S. Retail Gasoline Prices: http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=emm_epm0_pte_nus_dpg&f=m

Passenger vehicles in the United States: https://en.wikipedia.org/wiki/Passenger_vehicles_in_the_United_States

Resale Prices Tumble on Electric Cars: http://www.wsj.com/articles/resale-prices-tumble-on-electric-cars-1424977378


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Did Government Buying Boost GM's Sales To Make Obama Look Good?

Last quarter, General Motors (GM) sales were reported being up by a whopping 16%; making Obama's "masterminding" of the GM bailout look like a miraculous turnaround for a company that had almost gone belly up.  And, of course, Obama has taken every opportunity to promote GM's success story as his own; while on the campaign trail. In fact, last week's three-day bus tour through Michigan, Ohio, and Pennsylvania was dedicated to doing just that.

But, if you drill down into that 16% increase in sales, you would find that the federal government's fleet purchases of GM autos actually rose by an extraordinary 79% in June; just days before the second quarter sales numbers would be tallied.  How convenient that was for his bus tour and for this supposedly "most transparent" president in the history of the United States!

Fleet Sales data source: http://nlpc.org/stories/2012/07/05/gm%E2%80%99s-government-sales-and-truck-inventory-rise

Bus tour story: http://www.detroitnews.com/article/20120705/AUTO01/207050337/1121/auto01/Obama-bus-tour-to-tout-car-sales

Chevy Volt's Not So Electrifying Sales

Once again Chevy Volt's sales are disappointing.   Two months ago, there was a lot of left-wing joy in that fact that the Chevy Volt broke the 2,000 mark by setting a sales record of 2,289 cars.   Many in the industry saw this as a new trend that would help General Motors "exceed" its claim that they would sell between 15,000 and 20,000 Volts this year; with sales easily surpassing the high end of that range.  Sadly, sales slipped again last month and the Volt only managed to sell 1.654 vehicles.   What really hurt the Volt was the fact that the competing Toyota Prius Plug-In did so well; beating the Volt sales by 192 cars.

The problem with the Volt and other electric cars is the fact that the electric vehicle (EV) market is a niche market with only a small, limited amount of buyers.  For this reason, more models from more manufacturers only mean that this limited number of buyers will be spreading their buying over an increasing amount choices; and each model's sales will suffer in the process. Being the most expensive of all the electrics, this further limits the Volt's market to an even more limited, wealthier class of buyers.   As a result, the Volt's sales will be further marginalized.  Right now the buyers of EV's are finding the Prius the better buy with a known history of Hybrid/battery technology.  The average price of a Prius EV is only $26,000 as compared to the Chevy alternative at $40,000.   And, whether you buy a Volt or a Prius Plug-In, you still get the same $7500 tax rebate.  For all the above reasons, I think the Volt was a mistake and is ultimately doomed to die; and, not necessarily a slow death.