More positive economic news trickling in

The Hanley Wood Market Intelligence Key Indicator Alert is out for this week. And there is more positive news about the economy.

First both new and existing home sales are up slightly, making the third straight month of increases for both indicators, while median home prices for both new and existing homes have increased, too. These indicators could be pointing toward a stabilization in the housing markets, one of the key requirements for a true economic recovery to take place.

In addition, consumer confidence soared in May to its highest level since last September. Also significant is that this is the third straight month that the consumer confidence index has increased.

Personal incomes have increased slightly for the first time since last September. But consumer spending is down. So what are people doing with their money? Paying down debt and putting it into savings. Could this be an indication that consumers will be ready to buy once they know that the economy is out of recession?

If you have been watching the stock markets, you’ll notice a steady rise. Regular market increases and pull-backs have been the norm lately. And more money is moving back into those equity markets.

This all sounds like great news, doesn’t it? Don’t get excited too quickly, though. We’ve still got a huge albatross. It’s called the auto industry. With both GM and Chrysler in bankruptcy, look for effects on employment and consumer spending in the near future.

And then there is . . . inflation. But we won’t go there yet.

If you’d like to learn more about your own market (a micro-economy) by following three economic indicators each month, check out my article How To Become Your Own Economist: Reliably Predict Your Market With Just 3 Easy-to-Find Economic Indicators.