The secret lives of America’s debtors and Existing home sales drop

Americans are loaded up with credit card debt. What’s worse is that some husbands, wives and even children hide those money woes from their families. The results are often devastating.

Hidden debt is a common and insidious problem. It’s a form of cheating so subtle you don’t even know you’re doing it," said Bonnie Eaker Weil, a relationship expert and author of the book Financial Infidelity. It’s a power struggle that can be more harmful to a relationship than adultery.

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Johnny runs a nonprofit that teaches local youth how to handle money. He had no idea that his wife, Audi, was racking up thousands of dollars in debt behind his back.

Audi, 37, opened up a credit card without telling her husband and started shopping to relieve stress, buying clothes for herself and toys for her 8- and 10-year-old children.

I thought that I’d just pay it off each month, Audi said. [Read the full article]

Sales of existing homes unexpectedly fell in January, according to an industry report published Friday, highlighting concerns that the housing market is weaker than previously thought.

The National Association of Realtors reported that home resales fell 7.2% last month to a seasonally adjusted annual rate of 5.05 million units, down from the revised rate of 5.44 million in December. Still, on a year-over-year basis, sales were up 11.4%.

The drop surprised many industry analysts. Existing home sales were expected to increase slightly to an annual rate of 5.5 million, according to consensus estimates from Briefing.com.

The drop was due in part to a delay between shopping for a home and closing on it among buyers taking advantage of a popular tax credit, according to Lawrence Yun, NAR’s chief economist. [Read the full article]

China is one of the largest holders of U.S. Treasurys. So some worry that our massive budget deficit, which China has vocally complained about, is the equivalent of biting the hand that feeds us.

Notice though that I said that China is one of our largest creditors, not the largest. That honor now goes to Japan, which surpassed China according to the most recently available data from the Treasury Department.

Up until last month, you’d think there was no need to worry about angering the Japanese. But now that our best and brightest in Congress have done a wonderful job of verbally undressing the CEO of Toyota Motor (TM) in front of the entire world, are we biting the other hand that feeds us?

"We have to be the dumbest borrower around. It’s pretty remarkable. We don’t want to alienate Japan," said Haag Sherman, managing director with Salient Partners, an investment firm in Houston.

Japan held approximately $768.8 billion in U.S. [Read the full article]

What prices are doing: The benchmark 10-year note was up 11/32 to 100-9/32, with the yield dropping to around 3.58% from 3.63% late Thursday. Bond prices and yields move in opposite directions.

The 30-year bond rose 27/32 to trade at 101-20/32 and its yield was 4.52%. The 2-year note ticked up 1/32 to 100-4/32 and yielded 0.8%.

Treasurys prices posted strong gains this week, with the yield on the 10-year note falling from 3.8% Monday. The week also saw the successful sale of a record $126 billion in U.S. debt.

What’s moving the market: Investors gravitated toward Treasurys as disappointing housing and consumer confidence data overshadowed some more upbeat reports.

Sales of existing homes unexpectedly fell in January to a 5.05 million unit annual rate from a revised 5.44 million unit rate in December, according to the National Association of Realtors. Home resales were expected to rise to a 5.5 million unit rate, according to a consensus forecast from Briefing.com. [Read the full article]

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