And there is a lot of it this morning! Durable goods orders, specifically for airplanes, fell 7.8% in January.

A key barometer of business-equipment spending — orders for nondefense capital goods excluding aircraft — fell by 6.0%, after increasing 3.6% in December. Shipments for nondefense capital goods excluding aircraft decreased by 2.7%, after dropping by 0.8% in December; the shipments are used in calculating gross domestic product.The 7.8% decrease in overall durable goods orders surprised Wall Street. The median estimate of 21 economists surveyed by Dow Jones Newswires had durables just 3.2% lower in the first month of 2007.

This is another indication of a slowing manufacturing sector. On the other hand…

Consumer confidence is at its highest level since 2001!

Consumer confidence rose to its highest level in five-and-a-half years amid optimism that the nation's economy is creating enough jobs, a private research group said Tuesday…In a statement, Lynn Franco, director of The Conference Board Consumer Research Center, said that "improving present-day business conditions and an easing in the proportion of consumers claiming jobs are hard to get have combined to lift consumers' spirits.""All in all, it appears that the pace of economic growth exhibited in the final months of 2006 has carried over into early 2007 and may have even gained a little momentum," she added.

Another demonstration of the resilience of the American consumer. So what has happened in the housing sector?

Existing home sales jumped in January.

Sales of existing homes rose in January by the largest amount in two years, raising hopes that the worst of the severe slump in housing may be coming to an end. Median home prices, however, fell for a sixth straight month…Analysts said that the decline in prices was actually an encouraging sign that home sellers are starting to adjust their asking-price down and this should help speed the correction in housing…By region of the country, sales rose the most in the West, up 5.6 percent

Given that Maui usually lags the West Coast by 6-9 months, this predicts prices being flat to down in the short term and demand picking up this summer or fall. The increasing number of sales is not surprising given the confidence level consumers are showing in the economy. But when they buy, they feel as though they are controlling the market.

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