Predictions: no, no, never!

My last post The Wisdom of My Father inspired this from a reader:

“Rona...
Not sure your point with this blog entry.. are you saying that the Northeast is OK compared to the rest of the country? That the Northeast has turned the corner?”

I would like to answer him and anyone else who is looking to me to be part economist/part psychic:

I would rather poke my eyes out with a rusty paper clip than get into the prediction game. I am not an economist and I am not interested in wrestling statistics to death. My last post was about how the economic "news" is poorly written for those who do not read the whole article. The headline says DOWN, the news is UP.

My reader continues: “I agree the May Northeast number is up 3.8% from last month, but it is still down 9.9% from May of 2006, down 7.3% from January of 2007 and down 15% from the 2005 year number...”

The stats behind the AP article are about sales volume (number of pending sales) not price. When sales volume goes up or down, it indicates a problem with either the amount of supply or demand. Whether volume goes up or down is not a predictor of price unless you understand why it is changing.

Those who love numbers, have fun. However, knowing the change in sales volume without knowing the on-the-ground market conditions is predictive of nothing. I will continue to report on what I see and y’all can make your own predictions.