Capital Commerce

Has Charlie Rangel, the personable chairman of the House Ways and Means Committee, pulled it off? After unveiling "A New Trade Policy for America"–which would attach tougher labor and environmental standards, among other provisions, to U.S. trade agreements–the New York Democrat optimistically stated: "We are on the brink of restoring bipartisanship to American trade policy. The policies we've outlined today should send a clear message that this Congress wants trade, but we want trade that works for all Americans."

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As the saying goes, never try to catch a falling knife. And what made me think of that? This: New single-family home sales declined 3.9 percent in February to an annual rate of 848,000, according to new Commerce Department data. That's the lowest level in almost seven years and much weaker than the 990,000 rate expected by the consensus. Plus, it's the absolute reverse of the 3.9 percent rise in existing home sales. Even worse, sales were revised lower for November, December, and January. Here are four Wall Street takes on the news, none of them particularly cheery:

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The Dow Jones industrial average is now back within 2.5 percent or so of its all-time high after rallying 3 percent from its 2007 nadir. (The Shanghai Sneeze and all that.) But should the Dow eclipse its old mark, there are some people–other than massive short sellers, of course–who won't be cheering. As they see it, stock market "records" are phony because the various averages and indexes don't take inflation into account. Here is how economist Jason Furman, in an analysis for the Center on Budget and Policy Priorities, dismissed the Dow when it hit a nominal high last October at 12,090:

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Here are 400 billion reasons President Bush's 2001and 2003 tax cuts may not see the next decade of the 21st century. The five-year federal budget proposed by Senate Democrats last week lets the reductions stay in place after their current 2010 expiration date–if backers can come up with $400 billion to pay for them in 2011 and 2012. Extending them to 2017 would "cost" $1.8 trillion. (This sort of static analysis oddly assumes that taxes–whether higher or lower–have no economic impact.) Now given that the current Congress is having trouble coming up with $40 billion-$50 billion for a temporary fix to the alternative minimum tax, finding a spare $200 billion a year seems like a tall order indeed. "After 2008, the default budget position is going to be higher taxes," concluded Tom Gallagher, a veteran political analyst at International Strategy & Investment Group, in a recent chat.

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