How Far Have Home Sales Fallen?

Existing-home sales fell 2.2% to a 4.89 million annual rate in December, according to the National Association of Realtors. The median home price also declined to $208,400 in December, down 6% from $221,600 in December 2006. Inventories of homes fell 7.4% at the end of last month to 3.91 million available for sale, which represented a 9.6-month supply at the current sales pace. Sales of single-family existing homes fell by 13% in 2007, the biggest drop in 25 years.

Earlier Thursday, the Labor Department said the number of U.S. workers filing new claims for unemployment benefits fell last week for a fourth-straight week, suggesting that a resilient labor market at the start of the year might keep the economy from sliding into recession.

From the Wall Street Journal

Freddie Mac Takes a Dent from Mortgage Credit Woes

Just announced, Freddie Mac's net loss for the 3rd quarter more than doubled to $2.03 billion, this based on higher credit-loss provisions and the marking to market of securities. Why? The housing-market weakness and the deterioration of mortgage credit is to blame. The Freddie Mac said the fair market value of its net assets dropped by $8.1 billion in the quarter.

And now, Freddie Mac hired an adviser to study its capital-raising options. They say they are considering cutting its dividend by half. Accordingly, shares fell 6% in premarket trading.