October 2012

If a 20 ton bucket to haul your dirt was not big enough than today is your lucky day,Caterpillar has just come out with a 22 ton bucket,it was a 16 % increase over the old one,their new R3000H has the largest bucket of any underground LHD,(load-haul-dump) that is one gimongous bucket,22 tons! The extra 2 tons you will be hauling will help pay for the price increase,Caterpillar also announced that they were raising the prices 3% across the board,that price increase is for all of their mining and construction equipment.

With factory activity picking up, The Institute for Supply Management,a trade group of purchasing agents said Monday that factory activity rose from 49 % to 51 % 50 is considered the cut off point between an increase and a decrease in activity,most economist were happy with the report,this comes after a dismal spring with factory orders.in addition,the government said that U.S. builders spent more on home construction in August than any other month this year.

Home prices are starting to rise faster than anyone expected,U.S.home prices are coming off the bottom faster than anyone expected and with the 30 year fixed rate at an all time low their are buyers now that were fence sitters 30 days ago,August was the sixth month in a row with a modest increase,the figures are not in yet for September but it is expected to be at least a 5% increase over September of 2011.Last year most economist had predicted that home prices would fall all through 2012,the fact that they were wrong should not come as a surprise,their predictions have not been close to accurate since New York was a prairie,they missed the bubble bursting,they missed the ripple effects that it had around the globe,and now they have missed the rebound,thats not a big surprise.

Higher prices help homeowners build equity as home prices rise more people will list their house and then when the supply edges nearer the demand the prices will level off. Still the housing market has shown strength that was not evident last year,in addition the rising prices build consumer confidence that helps in other areas,the rising prices have taken 1.3 million people from having their mortgages underwater,it is now estimated that only 20 % of the homeowners are underwater and that number is going down every week.

The private Conference Board index of consumer confidence is at a seven year high,even if consumers are lukewarm about current conditions they are optimistic about the future.business confidence seems to be lagging consumer confidence,but that is not unusual,it always has,but if consumer confidence stays where it is at or improves it is only a matter of time that business confidence catches up.The European problems do not effect consumer confidence but that is not true with business the problems in the European community has a direct effect on our business confidence.

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