The Weekly Wrap: Still waiting for a housing boost
A construction worker stands on the roof of a condo complex under construction on July 17, 2013 in Berkeley, California.
Housing is up today, but the market still remains bleak and has yet to provide us with any sort of economic boost.
John Carney with the Wall Street Journal believes we're still burned out from last year.
"We had so much refinancing the last year that we sort of smuggled forward a lot of housing energy with low interest rates last year. There's just not a lot of juice. Everybody who wanted to refinance has. With wages sitll pretty low and unemployment still high, there's not a lot of new household formation going on."
Linette Lopez from the Business Insider adds, "And the people that could possibly refinance are thinking: Hey, maybe the Fed is going to raise rates soon, so why don't I just forget about this for now."
And with that, we move on to Credit Suisse. Early this week, Credit Suisse pleaded guilty to criminal charges of tax evasion, which coulld lead to additional related cases.
"When they criminally charged Arthur Andersen and the firm collapsed, that scared everybody to death. The prosecutors were loathed to actually charge criminally big corporations. What we've seen now....is that it's in fact surviveable. It doesn't just mean you go out of business when you're criminally charged. You can even plead guilty which is what Credit Suisse did... So I think prosectuers will now no longer fear it's a death sentence for corporations," says Carney.
In mergers and acquisitions news this week, AT&T also announced its plans to buy DirecTV for $48.5 billion on Sunday and we broke the news on Monday. There seems to be more corporate get togethers happening lately.
"There's probably a lot of pent up demand deals that haven't happened , so we're going to see a lot more of that," says Carney.
"When you're talking about AT&T and Direct TV, they're going to have make a lot of promises to consumers to insure and assuage the views of politicians that everything is going to be okay. And I'm talking about no bundling, helping people in rural areas get faster internet connection. The companies are going to have to sweeten the pot so that the government believes this isn't going to be monopolizing or hurting consumers in any way shape or form" says Lopez.
Overall, everything seems to be going a million miles an hour on Wall Street.
"It was expected," say Lopez. "As David Tepper said last week at a Wall Street conference, 'it's nervous time!' He said, 'I wouldn't go short. But don't be too long. It's time to keep some cash. So everybody just hold on to your hats until everything stabilizes.'"
...And that's the guy who made $3.5 billion last year!