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Notice how this corresponds to rising public sector deficits as counter cyclical fiscal policy does its thing:

UK Households Step Up Debt Repayments as Recession Deepens

Britons increased the equity in their homes at the fastest pace on record as the recession encouraged households to pay down existing mortgages rather than take out new ones. Individuals injected a net 8 bln pounds ($11.5 bln) into housing equity in the three months through December, the most since records began in 1970, the Bank of England said in London today. The credit crunch and falling house prices are making it harder to borrow against the value of housing. Concerns about job losses are also making homeowners reluctant to add to their 1.5 trillion pounds of debt as they endure the economy’s worst contraction since 1980.

“This is further evidence that households are retrenching sharply, sensibly paring down debt in the face of the credit crunch and fears about unemployment,” Colin Ellis, an economist at Daiwa Securities SMBC Europe Ltd., said in a note. Mortgage equity provided a key source of consumer finance for a decade as Britons used a property boom to finance everything from new furniture to vacations. After tripling in a decade, house prices fell an annual 17.7 % in February, Lloyds Banking Group Plc’s Halifax division said.

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There is NO school of economics that says health care costs should be a marginal cost of production. That distorts pricing and produces sub optimal results in ANY model.

Yet again, we are paying the price for an administration that doesn’t understand the monetary system.

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This raises national budget deficits and inches them closer to a liquidity crisis:

Highlights

Europe Unemployment Rate Rises More Than Expected

Trichet Says Spending, Deficits Can’t Keep Rising, Le Monde Says

Germany’s Steinbrueck Says New GDP Outlook to Be Clearly Worse

German Retail Sales Unexpectedly Fall After Unemployment Rises

France, Germany Not Satisfied With G-20, Sarkozy Says

Sarkozy Says Concrete Decisions Are Needed on Tax Havens

Europe Unemployment Rate Rises More than Expected

by Jurjen van de Pol

Apr 1 (Bloomberg) — European unemployment increased more than economists expected in February to the highest in almost three years as the recession forced companies across the continent to cut output.

The jobless rate in the euro zone rose to 8.5 percent from a revised 8.3 percent in January, the European Union’s statistics office in Luxembourg said today. The February reading is the highest since May 2006 and exceeded the 8.3 percent rate economists forecast, according to the median of 23 estimates in a Bloomberg News survey. The January figure was revised higher from 8.2 percent reported on Feb. 27.

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• MBA Mortgage Applications (Released 7:00 EST)
• MBA Purchasing Applications (Released 7:00 EST)
• MBA Refinancing Applications (Released 7:00 EST)
• Challenger Job Cuts YoY (Released 7:30 EST)
• Challenger Job Cuts TABLE 1 (Released 7:30 EST)
• Challenger Job Cuts TABLE 2 (Released 7:30 EST)
• Challenger Job Cuts TABLE 3 (Released 7:30 EST)
• Challenger Job Cuts TABLE 4 (Released 7:30 EST)
• ADP Employment Change (Released 8:15 EST)
• ADP ALLX (Released 8:15 EST)
• ISM Manufacturing (Released 10:00 EST)
• ISM Prices Paid (Released 10:00 EST)
• Construction Spending MoM (Released 10:00 EST)
• Construction Spending YoY (Released 10:00 EST)
• Pending Home Sales MoM (Released 10:00 EST)
• Pending Home Sales YoY (Released 10:00 EST)

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MBA Mortgage Applications (Mar 27)

Survey	n/a
Actual	3.0%
Prior	32.2%
Revised	n/a

 
More evidence of the rising deficit turning the economy sideways ahead of the fiscal package kicking in this month to increase the injection of net financial assets to the non government sectors:

US mortgage applications climb, rates at fresh low

by Lynn Adler

Apr 1 (Reuters) — The Mortgage Bankers Association’s applications index, which includes both refi and purchase requests, rose by a seasonally adjusted 3 percent in the week ending March 27 to 1,194.4.

The purchase applications index was little changed, rising 0.1 percent to 268.0, while the refinancing gauge gained 3.7 percent to 6,600.1.

This is up sharply from 2,722.7 as recently as early February.

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MBA Purchasing Applications (Mar 27)

Survey	n/a
Actual	268.00
Prior	267.80
Revised	n/a

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MBA Refinancing Applications (Mar 27)

Survey	n/a
Actual	6600.10
Prior	6363.20
Revised	n/a

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Challenger Job Cuts YoY (Mar)

Survey	n/a
Actual	180.7%
Prior	158.4%
Revised	n/a

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Challenger Job Cuts TABLE 1 (Mar)

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Challenger Job Cuts TABLE 2 (Mar)

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Challenger Job Cuts TABLE 3 (Mar)

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Challenger Job Cuts TABLE 4 (Mar)

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ADP Employment Change (Mar)

Survey	-663K
Actual	-742K
Prior	-697K
Revised	-706K

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ADP ALLX (Mar)

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ISM Manufacturing (Mar)

Survey	36.0
Actual	36.3
Prior	35.8
Revised	n/a

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ISM Prices Paid (Mar)

Survey	33.0
Actual	31.0
Prior	29.0
Revised	n/a

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Construction Spending MoM (Feb)

Survey	-1.9%
Actual	-0.9%
Prior	-3.3%
Revised	-3.5%

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Construction Spending YoY (Feb)

Survey	n/a
Actual	-10.0%
Prior	-10.1%
Revised	n/a

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Pending Home Sales MoM (Feb)

Survey	0.0%
Actual	2.1%
Prior	-7.7%
Revised	n/a

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Pending Home Sales YoY (Feb)

Survey	n/a
Actual	-6.2%
Prior	-6.6%
Revised	n/a

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