Business news for Mon, 31 Dec 2007 & with word economists. 2 news.

WASHINGTON (MarketWatch) - In a hint of stability, sales of existing homes rose 0.4% in November to a seasonally adjusted annualized rate of 5.00 million, the National Association of Realtors reported Monday. Sales of existing homes are down 20% in the past year and are down 31% from the peak of 7.21 million two years ago. Inventories of unsold homes on the market declined by 3.6%, representing a 10.3-month supply at the current sales pace. The median sales price fell 3.3% compared with a year ago to $210,200. November sales were in line with the 4.99 million annual pace expected by economists surveyed by MarketWatch.

Christmas cheer was left on the shelves this year. Scrooge is back. Or, so it would seem, if only the opinions of financial markets counted. In fact, we have never seen such pessimism among investors looking into the new year. After shaking their chicken bones, the consensus of American economists puts 40 per cent odds on a US recession next year. What would that mean for the beleaguered housing market and sub-prime woes? Surely, sitting on cash looks king again?