Your Fall Housing Market Update

by Mike Larson 10-30-09

Every few months for the past couple of years, I’ve made it a point to update you on the state of the housing market. I feel it’s essential to do so because …

• You may be buying, selling, or holding a primary residence or vacation home.

• You probably have a mortgage, and maybe a home equity loan.

• And you’re probably concerned about the broader economy, which the housing and mortgage markets significantly impact.

So where do we stand now?

Well, the stabilization and very mild recovery I first told you was coming back in the spring, continues apace. Sales have generally been picking up. The supply of homes for sale has generally been falling. And prices, while still weak and falling, are not falling as quickly.

The real question is: What happens when the mammoth support that the government is throwing at the market ends?

Used Home Market
Finding Its Footing

In September, existing homes sales hit a level not seen in over two years.

I’ll start with the existing home figures, since that’s the most important part of the market. Most of us own “used” homes and sales of such homes account for around 75 percent to 85 percent of overall transactions in any given month. The latest:

* Sales surged 9.4 percent to a seasonally adjusted annual rate of 5.57 million units in September from 5.09 million in August. That was twice the gain that was expected, and it left sales running at the highest level since July 2007.

* Single-family sales gained 9.4 percent, while condo and cooperative sales rose 9.7 percent. By region, sales climbed across the board, with the Northeast bringing up the rear at +4.4 percent and the West leading at +13 percent.

* Better yet, the raw number of homes for sale dropped 7.5 percent to 3.63 million units from 3.92 million in August. Supply was down 15 percent from a year earlier. That helped push the “month’s supply at current sales pace” indicator of inventory down to 7.8 from 9.3. That’s still higher than the 5-6 month range that’s considered “normal.” But it’s a significant improvement from the double-digit readings we were seeing.

* Pricing is still weak, with the median price of an existing home down 8.5 percent year-over-year to $174,900. But as any good housing analyst will tell you: Pricing lags sales and supply.

Indeed, if you recall what I said in my May 8, Money and Markets column:

“I still believe home prices have further downside. That’s because we remain oversupplied, with approximately 1 million excess housing units for sale in this country. More foreclosure inventory will likely hit the markets in the coming months, too. Reason: Many of the filing moratoriums put in place at the state and industry levels have expired.

“But the sharpest declines in residential real estate are, for now, mostly behind us. I expect to see sales volumes gradually stabilize on a nationwide basis over the coming year, with total inventory for sale (new plus used) gradually coming down. By mid-to-late 2010, we should see pricing stabilize and gradually turn higher, with the improvement coming in stages depending on location.”

Buying New?
Not Lately …

So what about the new home market? It’s taking a bit of a breather. An index put out by the National Association of Home Builders dropped to 18 in October from 19 in September. Builders said present sales, expectations about future sales, and prospective buyer traffic have all declined.

The new home market has slowed down a bit.

Meanwhile, actual sales have missed expectations for two months in a row. They dropped 3.6 percent in September to a seasonally adjusted annual rate of 402,000. Economists were expecting an increase to 440,000 units. Pricing remains weak, with the median price of a new home off more than 9 percent from a year ago to $204,800.

But here’s the thing: The supply picture in the new housing market has dramatically improved!

At the peak of the bubble, builders had 572,000 homes up for sale. That was the highest in U.S. history.

The dramatic cutback in production, combined with a general uptick in sales, has driven that number all the way down to 251,000. We haven’t had this few homes on the market since November 1982, almost 27 years ago.

Surprise, Surprise:
Government Policy Is
Distorting the Market …

Why are we seeing a divergence between the new and existing markets? Like it is in so many other parts of the economy, government policy is distorting things.

You see, the $8,000 first-time home buyer tax credit is set to expire on November 30. It applies to all transactions CLOSED by that date. The typical closing of an existing home takes about 30-60 days. So contracts signed as late as, say, July, August and even early September, are probably okay.

But when you sign a contract to buy a NEW home, unless it’s a “spec” property, you’re buying a plot of land. This means you’re looking at several months to build the house and close. So we got the tax-credit-fueled surge in the new home market EARLIER than the existing home market (June sales rose 7.6 percent, while May sales climbed 7.5 percent).

Since then, some buyers have gotten more reluctant to jump in because they fear they won’t be able to close in time to get their government handout … er … credit.

An extension in the tax credit should keep the housing recovery on track.

But — and this is important — Congress is now talking about extending the credit into 2010. The latest scuttlebutt is that the credit would now apply to all contracts signed through April 30 of next year, with an additional 60 days granted to close the transaction.

Not only that, but it may be expanded so that richer buyers could qualify! If that happens, couples making up to $225,000 would qualify, compared with $150,000 now. Plus it would no longer apply to only first-time buyers. If you’ve lived in your current home for at least five years, you would qualify for a credit of up to $6,500.

Bottom line is that the government’s massive housing and mortgage market support measures show no sign of letting up. In fact,

• The Federal Reserve is still buying $1.25 trillion of mortgage securities to keep rates low.
• The FHA is now backing the same kinds of high-risk loans that blew up private, high-risk lenders, allowing it to capture the largest share of the mortgage market in years.
• The “temporary” increases in the size of mortgages that FHA, Fannie Mae, and Freddie Mac can insure have essentially become permanent.
• And now, just as I forecast, the tax credit/handout is almost sure to be extended well into the future.

You don’t have to like it. Frankly, I don’t. But you do have to appreciate the reality of the situation and understand that it likely will keep the housing recovery on track.

It won’t be a linear process, though. Instead, I foresee more of a “three steps forward, two steps back” scenario.

Until next time,

Mike

October 2009 Update

The volume in the US stock market has declined since the rally started in March 2009.

This is not a good sign as price rises in declining volume indicates weakness and that the big instituitions and big money is not buying the rally since end of march.

In other words its probably mainly dumb money (average investors) that is causing the stock market to rise. This cannot go on forever so we are probably approaching a significant top.
So what this means is right now is not to time to take big risks on buying stocks.

if you do buy, get ready to sell it fast and dont get too greedy.

Gold- short term decline is outlook is there.. but bullish long term term. initial target is gold to $1300

Oil – a decline could happen in a few months and that will be a great buying opportunity as from then on it could rise significantly.

US Dollar – a decline of 50% is waiting for the us dollar in the next few years.(my research shows atleast 2 years of huge pains for the dollar) it has broken technicals of a 15 year chart,so this is quite a significant development, so the trend for the dollar is down so if you want to trade this, buy the opposite side of the dollar.. euro/ commodities/ aussie dollar/ canadian dollar/ gold/ oil .. etc…

Getting Inside the Fed’s Head

by Mike Larson 10-16-09

Every so often, someone decides to pick a fight with me over the Federal Reserve. They say I’ve got it all wrong. They say the Fed is going to prove its mettle. They say that foreign central banks are crying “Uncle” over the dollar, and that this will force the Fed to reverse course and start raising rates.

Folks, that’s just hokum.

Bunk.

Hogwash.

B.S.

Pick whatever term you’re comfortable with!

To those who argue otherwise, I would simply reply that you have to get into the “Fed’s head.” You have to understand what’s driving their approach to policymaking. The underlying principle is this: They are more afraid of a relapse in the economy than any big outbreak in inflation.

Fed Speeches Make it Clear That
Easy Money Is Here to Stay

Gold continues to hit new highs as worried investors dump the dollar.

The Fedheads who are in power right now are Ivory Tower policy wonks. They simply do NOT care that oil prices have more than doubled off their lows … that gold is zooming to new highs almost every day … or that the dollar is circling the drain.

Instead, they’re the type of people who IGNORE market signals like those. They focus on traditional economic indicators, such as figures on capacity utilization, unemployment, and consumer prices.

Don’t believe me? I can’t understand why. Every few days, we get even MORE reinforcing proof that I’m on the right track.

Take Fed Vice Chairman Donald Kohn. He just gave a speech in St. Louis to the National Association of Business Economics. In describing the economy, he had the following nuggets to share …

“The substantial rise in the unemployment rate and the plunge in capacity utilization suggest that the margin of slack in labor and product markets is considerable …

“Businesses have been aggressively cutting costs not only by eliminating jobs, but also by cutting back increases in labor compensation …

“Even as the economy begins to recover, substantial slack in resource utilization is likely to continue to damp cost pressures and maintain a competitive pricing environment. I expect that the persistence of economic slack, accompanied by stable longer-term inflation expectations, will keep inflation subdued for some time …

“The financial headwinds are likely to abate slowly, restraining the economic recovery.”

There’s nary a mention of market signals … nor a hawkish statement among them. Kohn is clearly not “prepping the battlefield,” so to speak, for an interest rate hike.

Or how about St. Louis Fed President James Bullard? He said in a Bloomberg radio interview on Monday that “you want to see the economy start to recover in all its dimensions, output and trade” before you raise interest rates.

Judging by the minutes of their recent meeting, it seems that the Fed just doesn’t care.

In English, that means the Fed won’t raise rates until unemployment starts dropping notably. Bullard went so far as to say that a falling unemployment rate was a “prerequisite” to boosting interest rates.

The problem with that thinking is that unemployment is a lagging indicator. Inflationary pressures could already be building — and the asset markets could already be bubbling out of control — long BEFORE the unemployment rate drops sharply.

Meanwhile, the just-released minutes of the Fed’s late September meeting show that officials were actually considering INCREASING the size of their mortgage purchase program!

The Fed has already committed to buy a whopping $1.25 trillion of mortgage-backed securities to drive rates lower. That version of “quantitative easing” is hammering the dollar, and the market had been looking for a signal the Fed might back off.

So judging from the minutes … the Fed just doesn’t care.

Fed Mantra: Avoid the Great
Depression-Style “Double Dip”

You simply have to understand that the Fed is operating from the “Great Depression” playbook. They’re deathly afraid of a 1937-38 type scenario where, they believe, tighter monetary policy helped contribute to a substantial double dip in the U.S. economy.

This is what I call the “Paul Krugman” view. The Nobel Prize-winning economist (who writes for The New York Times) reiterated in South Korea this week that he thinks it’s way too early to cut back on the “Free Money, Now and Forever” regime. Specifically, he said:

“Under the best of circumstances we’re going to have years before we return to anything that approaches reasonable levels of employment in the major advanced economies … that means staying with these very nonstandard policies for an extended period. It means keeping interest rates close to zero for a very long time.”

The Fed’s irresponsible monetary policies are squeezing the life out of the dollar.

I will tell you flat out that this is going to end in disaster! The Fed has now helped inflate two gigantic asset bubbles with its reckless easy money policies. I have zero doubt they’ll screw it up again — and that things will blow up in our faces … again.

But you simply can NOT jump the gun. The next bust will only occur when policymakers change course, the bond market blows up, or we get, say, a concerted effort to bolster the greenback by virtually every central bank in the world.

I see zero signs of that happening. So as long as that’s the case, and the Kohn-Krugman school of thought is guiding policy in Washington, you have to stick with the carry trade mentality.

That means you can’t really short the stock market for more than a quick trade, and in select special situations. You have to favor emerging market stocks and foreign bonds. You have to write the dollar off. And you have to stick with gold and other hard assets that can hold their value in a free-money regime.

Until next time,

Mike

Commodities Cycles

There are a lot of people, main stream financial media and the government that have interests in seeing gold going down in prices.
Wallstreet does not like high Gold prices.

Over the next 5 years Gold can double to around $2000, ofcourse silver will probably triple or more.

All commodities goes in cycles of approx 20 years and currently it is not the end of the cycle. That is why lot of stock traders and commodity traders like Marc Faber, Jim Rogers study history.
If you look in the stock market crash of 1929 onwards you will see that the market has been very volatile. and the best investments were in Gold and Gold stocks. I dont have all this data right now but I have looked at them few times in the past and it shows that when you have a crash you dont buy all you can.. You buy stocks slowly so you keep your powder dry if there is another crash, so you can again buy.

That is the reason why I bought very slowly early this year, incase we have another market crash and actually I bought my Gold in January and market crashed in March… but because i had such a small amount i did not care.

From the historical data you can find that after the 1930’s crash, stocks increased so many times fold that your investments multiplied many many times. It didnt happen right away. Took many years but after about 10 years, they were all at fantastic levels.

Dollar Index bearish short term

Short Term forecast for the US Dollar is bearish as the support from 2 years ago has broken.

I expect it to fall again for the short term again.

Buy Stocks, Commodities, Foreign Currencies- Euro, AUD

-TNB

Gold Giving Another Strong Buying Signal

by Claus Vogt 10-14-09

In my September 9 Money and Markets column I showed you this gold chart:

Source: www.decisionpoint.com

On that date, I said, “This breakout of a huge triangle is a clear technical buying signal.” I added that the minimum price target of this triangle formation was roughly $1,100. This was well above major resistance in the $1,000 area, thus hinting that another major breakout and buying signal would take place soon.

Well, that’s exactly what happened last week!

Gold Hit 1,059 …
Triggering Another Major Buy Signal

Take a look at the weekly chart below. It gives you a good perspective of how important this breakout to new high ground actually is. As you can see, it signals the end of a medium-term correction that began in March 2008 and the beginning of the next medium-term up trend of a secular bull market that started in 2001.

Source: www.decisionpoint.com

The minimum price target of this huge consolidation pattern is $1,300. And I believe much larger gains are certainly possible.

Also consider this: Four weeks ago the Hulbert Gold Newsletter Sentiment Index (HGNSI) stood at 25.2 percent. Now, four weeks later and gold nearly $100 higher, the HGNSI has actually fallen to as low as 18 percent! A rising market accompanied by a declining number of bulls is a rare development. And it’s clearly bullish.

Longer Term Fundamentals
For Gold Are Very Bullish, Too

There are many fundamental reasons to own gold.

Besides the technical buying signals I’ve given you today, I want to repeat the major fundamental arguments for owning gold:

• As a consequence of the current financial and economic crisis, government debt is going through the roof — not just in the U.S., but all over the world.
• Worldwide central banks are printing money like there is no tomorrow.
• Gold demand is rising due to wealth creation in emerging economies where gold still plays a large role as a store of value.
• Gold demand is even rising in the West as more investors doubt the wisdom of central banks and governments.
• Gold supply is stagnating or even slightly shrinking — despite the metal’s price rise since 2001. This is because it’s getting ever more difficult and expensive to get gold out of the earth.
• Finally, central bankers who were eager to sell government gold at much lower prices a few years ago, are getting increasingly reluctant to keep doing so. Emerging market central banks are even buying.

As long as most of these catalysts for higher gold prices remain in place, I expect the long-term bull market to continue. And much higher highs are very likely.

Best wishes,

Claus

Colleges in MN reporting huge increases in enrollment

Number of colleges here in Minnesota are reporting very high enrollment rates. My guess is the trend is noticed all over the country’s colleges. Not a surprise considering the weak economy.

http://www.startribune.com/local/east/63816602.html?page=1&c=y

Tightening Begins Overseas; Here? Not So Much …

I told you so – TNB

by Mike Larson 10-09-09

Just a couple of weeks ago, I told you what to expect from the U.S. central bank on the interest rate front. Nothing. Absolutely nothing. Not now. And not for a long, long time. The Federal Reserve has made it abundantly clear that the “Free Money” party will keep raging ad infinitum, with all its attendant consequences.

But in a handful of countries overseas, central bankers are actually showing some spine. Unlike the U.S. Fed, they can see that the ocean of cheap, easy liquidity is forming mini-asset bubbles. They realize that the acute phase of the credit crisis is over, making it absolutely unnecessary to maintain “emergency” interest rates. And they’re taking action …

• The Bank of Israel fired the proverbial shot across the market’s bow in August. It raised its base interest rate to 0.75 percent on the 24th of that month from 0.5 percent.
• Indian central bankers have signaled they could soon raise that country’s benchmark reverse repurchase rate from 3.25 percent.
• Speculation is mounting that Bank Indonesia will soon raise its 6.5 percent benchmark rate.
• Ditto for the Bank of Korea and its 2 percent policy rate.

Australia’s central bank raised its key cash rate on Tuesday, indicating that the worst danger for the economy had passed.

And Australia dropped the biggest bomb of all this week …

The Reserve Bank of Australia increased the country’s overnight cash rate by a quarter-point to 3.25 percent, becoming the first “Group of 20″ country to take that step. Private forecasters currently expect the Reserve Bank of Australia to raise rates by a further percentage point in 2010.

Meanwhile, Our Fed Is Singing From
An Entirely Different Hymnal

The message coming out of our officials in this country couldn’t be more different. Here, we’re getting a virtual open-ended promise of government aid and monetary largesse for as far as the eye can see …

• New York Fed President William Dudley just told a Fordham Law School audience that the Fed’s “near-term focus should be to keep significant monetary accommodation in place for an extended period.”
• Boston Fed President Eric Rosengren sang a similar tune a few days earlier. He said, “It’s important that monetary and fiscal policy continue to support the economy until private-sector spending has resumed, and until we are confident that the recovery will continue once the programs that have supported the economy over the past year are removed.”
• And the Federal Open Market Committee’s own statement from its September 23 meeting contained the following, crystal-clear message: “The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.”

The Fed seems determined to let the dollar crash and burn.

The consequences? The U.S. dollar plunged to new cycle lows against the Australian and New Zealand dollars. It got whacked by the Indian rupee, the Singapore dollar, and the Indonesian rupiah. And gold — the ultimate world currency that no central banker can print out of thin air — soared to close at $1,058 yesterday, the highest nominal price level in the history of the world.

The Forecast: More of the Same

From time to time, we’re going to see the dollar bounce. We’re going to see gold sell off. We’re going to hear the occasional throwaway comment from Fed and Treasury officials that they care about the buck.

But we all know the truth. That’s hokum! This is a deliberate campaign to drive down the dollar in order to help reinflate the asset markets. Everyone in Washington knows it. They just won’t talk about it openly!

Here at Money and Markets, though, we don’t mince words. We don’t subscribe to the whole “Fed worship” mentality that seems prevalent on Wall Street. If we see foreign central banks defending and supporting their currencies, while our Fed is doing all it can to throw the dollar under a bus, we’re going to tell you. And we’re going to tell you how to protect yourself. I trust you’d expect nothing less.

Until next time,

Mike

Gold breakout with new high of $1059

Quick note on gold.

It has broken out to the upside. This happened when gold traded above previous high from 2008 which was $1029.

This is very bullish on the shorter to medium term. Right now as im looking at the price it is showing at $1057.

IF you are looking to sell i think it is too early to take profits.It would be better to wait for for somewhere close to $1190 – $1300 to sell.

If you are looking to buy, gold seems a bit extended. I would rather wait for a small pull back to around 1030 – 1040 before buying.

TNB

August pending home sales rise to 2 1/2 year high

You can expect that house prices to fall if there is no extension. Regardless if you are interested in buying a house you should be looking at prospects right now since if the new bill is extended, sales should recover. -TNB

Pending home sales rise for seventh straight month in August to highest level since March 2007

• By Alan Zibel, AP Real Estate Writer
• On Thursday October 1, 2009, 12:31 pm EDT

WASHINGTON (AP) — Aspiring homebuyers rushed to take advantage of a tax credit for first-time owners that expires in November, driving up the number of signed sales contracts for the seventh straight month in August.

AP – In this Sept. 23, 2009 photo, a home with a sale pending is shown in Tallahassee, Fla. The …

Construction spending also rose unexpectedly in August on the biggest jump in housing activity in nearly 16 years, another sign the real estate market is recovering from its four-year slump, data Thursday showed.

Sales and homebuilding are being fueled by a tax-credit of up to $8,000, low mortgage rates and cheap foreclosures. In some of the most hard-hit areas, like Phoenix and Las Vegas, there are bidding wars for deeply discounted properties. And in all but a few cities, home prices are slowly starting to rise, reversing their three-year descent.

To make sure first-time buyers can complete their purchases by the Nov. 30 deadline, real estate agents "have been pushing buyers to sign a contract at least a couple months in advance" according to Abiel Reinhart, an economist with JPMorgan Chase.

More than a dozen bills have been introduced in Congress to extend the credit, but it’s unclear if lawmakers want to continue to subsidize the market.

The National Association of Realtors said Thursday its index of sales agreements rose 6.4 percent from July to 103.8, beating forecasts. It was the highest since March 2007 and 12 percent above a year ago. Economists surveyed by Thomson Reuters expected the index would rise to 98.6.

Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer of future sales. However, new rules for home appraisals and rigid lending standards have scuttled many sales agreements recently. In addition, the index may also double-count some buyers who agree to purchase other homes after the first deal falls through.

These factors have made the index a less reliable gauge for completed sales. Despite a steady increase in the number of signed contracts this summer, for example, completed sales actually took an unexpected 2.7 percent dip in August.

"Perhaps the real question is how many transactions are being delayed in the pipeline, and how many are being canceled," Lawrence Yun, the Realtors’ chief economist, said in a statement. "Without historic precedents, it’s challenging to assess."

Pending sales were up 16 percent in the West and 8 percent in the Northeast. They were up 3 percent in the Midwest and nearly 1 percent in the South.

Home prices, meanwhile rose 1.2 percent from June to July, according to the Standard & Poor’s/Case-Shiller home price index of 20 major cities. On a seasonally adjusted basis, prices rose in all but three metro areas, Las Vegas, Detroit, and Seattle.

Housing experts, however, remain divided on whether the price gains signal a definite bottom to the worst housing downturn in decades or just a brief respite from plummeting prices.

Sept. US auto sales fall amid clunkers letdown

A similar effect should happen once the Housing tax credit expires too. -TNB

September US auto sales fall following Cash for Clunkers buying spree over the summer

DETROIT (AP) — GM, Ford and Chrysler reported September sales declines on Thursday, revealing a tough hangover from this summer’s Cash for Clunkers buying spree.

AP – FILE

General Motors Co. reported the steepest drop, 45 percent, when compared with September of last year. Chrysler Group LLC was down 42 percent and Ford Motor Co. had a much smaller decline of 5.1 percent.

But Hyundai bucked the trend, reporting a 27-percent rise in sales last month over a year earlier.

Automakers got a big lift in July and August from clunkers, which spurred sales of nearly 700,000 new cars and trucks. The government program’s big discounts lured in many customers who otherwise would have waited until later in the year to walk into dealerships.

Now automakers are starting to feel the effect. GM said it sold 155,679 vehicles last month compared with 282,806 in September of last year. Ford reported sales of 114,241 in September, but the decline followed two straight months of rising sales. Chrysler sold only 62,197 vehicles last month.

GM blamed the decline on the clunkers program pulling buyers into July and August, weak consumer confidence and low inventory levels during September before production increases could replenish stocks.

"As expected, the market returned to pre-Cash for Clunkers levels in September," Mark LaNeve, GM’s vice president of U.S. sales, said in a statement. "Fortunately the fourth quarter looks brighter."

Ford’s top analyst told reporters on Thursday he does not think the Cash for Clunkers hangover will affect sales in October and beyond.

"I think most part the payback for the program will be minimal in the coming months," George Pipas said. "I don’t think we should be using any excuses. I think from now on the economy stands on its own."

Cash for Clunkers and summertime production cuts kept inventories of popular models low during the month, but even so, Chrysler predicted its market share will rise 0.8 percentage points from August levels. The company increased factory output to replenish supplies.

"While we had some bright spots in September, it was still a challenging sales environment for the industry," Peter Fong, CEO of the Chrysler brand, said in a statement.

Sales of Ford’s popular F-series trucks rose 3.5 percent, while sales of the new 2010 Taurus sedan increased more than 60 percent.

Ken Czubay, Ford’s vice president of U.S. marketing and sales, said that could be a key indicator that pickup sales are starting to recover among core buyers who need them for work, and it may be an early indicator that small business owners are experiencing a turnaround.

"It’s two months in a row of F-series sales increases for us," Czubay told reporters during a conference call. "It’s not the large commercial purchases, it’s more the individual."

The F-series trucks usually are the top-selling vehicle in the U.S.

The September results fell 37.2 percent from August totals, which were boosted by the government’s Cash for Clunkers program. Two of Ford’s vehicles — the Focus and Escape — were top sellers in the program that ran during July and August and offered big discounts to buyers.

Sales of the those vehicles posted steep declines from from August to September. Focus fell 64.1 percent from August, when Ford sold 25,547 of the small, fuel efficient cars. The company sold 9,182 in September.

The Escape crossover posted a month-over-month sales decline of 58.5 percent, with Ford selling 8,692 of the vehicles last month, compared to 20,933 August sales.

Chrysler also saw a slowdown between August and September. The company’s sales fell by a third to 62,197 from 93,222 in August.

South Korean automaker Hyundai’s sales jumped on easy comparisions to a weak year-ago period and strong demand for its Elantra and Santa Fe models.

Automakers sold a combined 1.3 million vehicles in August for a seasonally adjusted sales rate, or SAAR, of 14.1 million. Many analysts expect a SAAR of 9.3 million for September.

Shares of Ford fell 19 cents, or 2.6 percent, to $7.02 in afternoon trading.