This from Today’s Financial News:

Just a few days ago, I wrote about how the housing slowdown has reached its lowest point. I told readers that some real-estate investment trusts (REITs) look downright promising. I also warned that others were in extremely dangerous territories.

Yesterday’s consumer spending figures proved my theory was right on track. The report showed that while consumer spending dropped 1.2%, healthcare spending was up by a similar amount.

In other words, REITs that specialize in healthcare properties, like National Health Investors (NYSE:NHI), will beat the markets. And their counterparts that focus on retail-related properties, like Simon Property Group (NYSE:SPG), are going to under-perform.

Going out of business sale

Mall owners saw their share prices get slashed yesterday. As a whole, retail-based REITs dropped over 14%, while the rest of the markets dropped by just 8%. Stocks with those kinds correlations to consumer spending are not the kind of stocks you want to be investing in during a recession.

The pain is only going to get worse for REITs like Simon Property. Right now, out of the more than 380 malls the company owns, 91.8% of them are occupied. This time last year, that figure was only slightly higher, reading at 92% occupancy. Only a few less stores are rented now than last year.

Those two figures should scream to potential investors that the worse is yet to come. Because store closures significantly lag behind dwindling retail stores, we are going to see occupancy rates drop for several more quarters, if not years, to come.

Going belly-up

Companies like Circuit City (NYSE:CC) and Linens ‘n’ Things are in serious trouble. The electronics retailer is within grasp of bankruptcy. And the home furnishings chain is closing its door for good, with some stores shutting down as soon as tomorrow.

It is the same picture all over the industry. Mall occupancy rates will soon start to plummet.

Needless to say, the retail REIT sector is in serious trouble. As a value investor, it may be tempting to grab these stocks at current prices (they have fallen more than 40%) thinking they have reached their bottom. Do not do it. It is a trap.

The retail industry’s woes have just begun. The problems will get much worse before they even think of getting better.

If you are looking to play the real estate industry and take advantage of its sizeable dividends, look at the healthcare industry and its lucrative REITs. There are only two sectors of consumer spending that are actually expanding. Take advantage of them.

Source: Retail figures slump: Simon Property Group (SPG) feels the pain

Think about it this way: we could soon be facing a housing shortage.

Falling property prices and tighter credit markets are putting a stop on construction activity. Buildings — especially in the commercial and industrial sectors — take a long time to put up. So this industry will be the laggard when the economy recovers.

If you don’t own land, Andrew says real estate investment trusts (REITs) are a great way to play the bounce.

But you have to cherry pick.

The retail sector is a nightmare now, but health care is booming. This makes health-care REITs such as National Health Investors (NYSE:NHI),  HCP Inc. (NYSE:HCP), Ventas Inc. (NYSE:VTR), and Nationwide Health (NYSE:NHP) great contrarian buys right now.

More from Today’s Financial News:

With the markets in a dive and talks of a global recession, it is no wonder the real estate industry is on shaky ground. But why are some experts calling for a major housing shortage?

Last week I wrote about the very real possibility that the real estate market has reached its bottom. This week, the headlines are proving my forecast was dead-on accurate.

Just a few days after investors were wailed by talks of gloom and doom across all arms of the economy, the situation in the real estate market is looking much, much more positive.

In fact, some experts are predicting a serious housing shortage in the not-so-distant future.

Think about it. Right now, there is not one builder out there that is certain of his future.

Over the past five years, business was booming. Now, finding folks willing to invest in building a new home or fixing up an existing home is an ever-growing challenge.

Making matters worse, when a builder does find a willing buyer, the tightening of the credit market makes it nearly impossible for him or his buyers to get the needed cash to start the project.

The market mess is creating a black hole in the building industry. Construction sites are empty. Equipment is gathering dust. And weeds are growing tall on proposed building sites.

Damming the waters

With nobody wanting to build now, it means there will be no new buildings in six months, one year, or even two years. When the economy finally rebounds, the building industry will be a laggard.

That is the best news in a long time for the real estate industry, as it will create a serious housing shortage. Thanks to the market’s horrific downturn and eradication of all new building prospects, we will see a major upswing in the real estate market in less than two years as demand rises and supply shrinks.

The shortage will create all sorts of investing opportunities, especially in the industrial and commercial real estate sector, where new projects often take three years or more to complete from ground breaking to ribbon cutting.

Unless you happen to be sitting on a few hundred acres of industrially zoned land, you will have to find another way to take advantage of the coming boom.

Fortunately, real estate investment trusts (REITs) offer an easy and effective way to take advantage of industry up-ticks. Find the right one (there are hundreds of them out there) and you will get a steady stream of dividend income and the potential for the long-term appreciation the real estate industry is known for.

Is there a doctor in the house?

As I mentioned, the current halt to nearly all new building activity will be most pronounced in the commercial sector. Still, that is a huge section of the market with a lot of great opportunities and some not-so-great opportunities.

Many commercial REITs focus on the nation’s retail-store sector. These investments do great when the economy is rolling, but flat-out stink when the market slows. You can do much better in the world of REITs than investing in retail properties.

The area you need to focus on is the nation’s growing healthcare industry. The huge Baby Boomer generation is getting older. Hospitals are expanding at record paces. And more long-term care facilities are desperately needed.

It is a great opportunity for healthcare-focused REITs like National Health Investors (NYSE:NHI). The company owns over 150 healthcare facilities, consisting of long-term care, retirement homes, and assisted living facilities.

National Health is not alone in this profitable sector. REITs like HCP Inc. (NYSE:HCP), Ventas Inc. (NYSE:VTR), and Nationwide Health (NYSE:NHP) are all major players.

What makes National Health stand above the crowd, especially in a highly unstable credit market like this one, is its very low levels of debt. (Its 8% annual dividend doesn’t hurt, either.)

As of last quarter, the company has just $22 million in short-term debt on its books. Meanwhile, it has over $94 million in cash. That means you will not be hearing of emergency capital infusions or liquidity problems anytime soon. National Health has a very strong balance sheet.

As this market mess plays out and the nation’s real estate industry rebounds, investors will begin to realize there is a serious shortage of newly constructed commercial buildings.

The shortage will raise prices for properties across the industry, especially in the growing healthcare sector.

Do some homework, take a look at REITs like National Health and invest appropriately. In less than 24 months, you will be very glad you did.

Source: Housing Slowdown? Try Housing Shortage!

For sovereign wealth funds (SWFs), the answer is commercial real estate. These mega funds are homing in on the sector right now, according to emerging markets expert Irwin Greenstein.

We keep hearing about the real-estate meltdown. But as of the end of September, REITs have been up about 2% for the year — a far cry from the wreckage of other markets.

Whether or not the SWFs are quietly propping up commercial REITs may never really be known. But what we do for sure is that these state-owned mega-funds are honing in on commercial real estate.

If you haven’t heard of a SWF, it’s a state-owned investment fund — often with assets in the billions. Many originate in countries with huge surpluses either from trade or commodities, and they have to keep this money in play all the time.

According to a report from AltAssets, SWFs are moving away from mature industrialized markets and into the so-called MENA regions, an acronym for Middle East North Africa.

In fact, with 2008, SWFs have been focused more on MENA than in the previous year.

What does this have to do with commercial real estate?

For SWFs, emerging markets such as MENA and commercial real estate pose less of a risk than the U.S.

In the second quarter of 2008 the SWFs tracked in the study made 43 deals totaling $26.5 billion, compared to 42 deals and $58.3bn during the previous quarter. More than half the deals and funds invested were in emerging markets.

In conjunction with rising interest in emerging markets, SWFs are allocating an increasing amount of money to commercial real estate.

A report issued by the international capital group of Jones Lang LaSalle said that the second-largest sovereign wealth fund, Norway Government Pension Fund, recently allocated 5% of its assets to real estate, infusing another $20 billion of capital into the real estate markets.

The report continues…

“If China follows suit with 5% of their foreign allocation into real estate, we are at nearly $25 billion. If Korea puts a third of their $10 billion allocated to alternative investment in real estate, that brings the total of fresh real estate capital coming to play in the short term up to $28 billion.”

Another report from real estate services giant CB Richard Ellis says SWFs will potentially invest around $725 billion in the next seven years in the global commercial property markets.

The Ellis report says that typical safe havens will include central London, but other trophy real estate targets could be New York, where the Abu Dhabi Investment Council bought the Chrysler Building.

Distressed real estate is ideally suited to the long-term appreciation strategies of SWFs.

With nearly $4 trillion of total assets currently under SWF control, a 7% allocation would mean worldwide commercial real estate investments totaling $280 billion, according to Ellis.

Putting the figures in perspective, Ellis observed that entire U.S. institutional-grade property portfolio owned or managed by investment managers and plan sponsors is valued at approximately $330 billion.

Based on this research, if you’re a headline investor commercial REITs may not be too appealing at this point in time. For contrarian profit seekers, it could be a good move.

This from The Sovereign Society:

We may — emphasis on the word may — be seeing the first glimmer of hope in the market. History often repeats itself, so it would be wise to keep your eye on this number.

Buried in the news yesterday [Wednesday] was a little note from the National Association of Realtors. They reported an index of sales contracts on previously owned homes rose 7.4% in August from the prior month. The NAR’s pending home sales index was designed to try and measure which way the housing market is going in the future.

Often the industry that crashes first in a financial crisis is the first to recover. If history does anything well it repeats itself. So I’m keeping my eye on real estate.

This index has been long known as a LEADING INDICATOR and this is critical. As a “Leading Indicator,” it’s forward looking; like a crystal ball for the housing industry. Perfect? No, but it’s not bad either. And that’s why I see this as the first glimmer of hope.

The index was also up 8.8% from August 2007. They recorded gains of 18.4% in the West, 8.4% in the Northeast, 3.6% in the Midwest and 2.3% in the South. Even July’s pending home sales index was revised up, to a decline of 2.7% from a prior estimate of a 3.2% decrease.

Karl Case, the “Case” of The S&P/Case-Shiller Home Price Indices (one of the best-known measures of the residential housing market) said in September that he “thinks that the housing market may be near a bottom.” If he’s right, financial firms may be able to breathe a sigh of relief.

And in a paper presented before the Brookings Institution in Washington, D.C. that same month, Mr. Case argued that there is cause for optimism. He noted that of the 20 metropolitan areas covered by the Case/Shiller index, nine have shown prices slightly improving in recent months. He noted that the relationship between incomes and home prices has neared a level seen at the end of past housing slumps.

Buyers are finally coming to the table. Prices have dropped significantly in many areas; Fannie and Freddie have been stabilized. Pent up demand is letting off some steam.

Now, please don’t get the impression that I’m bullish on the U.S. Real Estate Market, but I’m looking, I’m watching, I’m following the data.

There will be huge opportunities again to be made in real estate. History will repeat itself…again. And I want to be there when it happens this time.

Source: A Turning of the Tide?

Eric Roseman says the US REIT sector is likely to recover first. That’s because Europe and Asia are behind the US in the credit crunch cycle and have further to fall.

Pending home sales index bounced 7.4% in September. And government-auctioned foreclosures create great property bargains. Eric says iShares Real Estate ETF (NYSE:IYR) is one good way of playing this recovery.

This from The Sovereign Society:

Since the onset of the subprime mortgage crisis 14 months ago, REITs  have plunged in value – with the biggest declines happening in Europe, Eastern Europe, and Asia.

The turning point for REITs came in early 2007. At the time, an enormous number of new offerings hit the scene and the “bubble” began to simmer. REIT sponsors went hog-wild, with easy credit and the lowest interest rates in a generation.

REITs boomed recently in the Pacific where policymakers introduced new legislation that allowed REIT structures in Japan, Singapore, and Hong Kong.

But REITs have plummeted more than 15% over the last 12 months in Singapore, and they’re down in excess of 45% in Australia. In Japan, J-REITs have tanked almost 30% over the last 12 months and remain 25% off their best levels in the United States.

The Big Chill

In addition to the problem of over-abundant supply, the ongoing credit crisis has also hit REIT values hard over the last year. That’s because developers and property managers require access to credit to expand or modernize existing properties.

With even the highest quality of loan candidates struggling to raise capital this year, it’s no wonder the sector has correlated almost perfectly with bank stocks.

In Asia, 2008 has been especially painful for REITs as the growing credit crisis, falling stock markets and plunging asset prices resulted in the cancellation of offerings.

The credit squeeze has made it much harder to raise equity and debt to finance deals. So now some smaller and mid-sized REITs are now threatened by questionable business models.

It’s the same phenomenon spreading to Europe and even fast-growing Eastern Europe as REIT values have collapsed. Even in red-hot China, many construction companies have either failed or remain technically insolvent as the big real estate boom cools off.

Beyond the Bear…Batting Cleanup on the REIT Crash

The United States REIT sector might lead the rest of the sector to recovery over the next 12 months, assuming the credit crisis ends and banks begin lending again.

But while U.S. REITs have shown signs of bottoming this year, regional REITs in Europe and the Pacific are still in the midst of sharp corrections.

Indeed, as economic growth slows across Europe and Asia over the next several months and more credit-related turmoil spreads to Europe, the United States is starting to look like a relative safe-haven. You see, the ongoing credit crisis hit America first. With the latest passage of the bailout bill in Congress last Friday, markets might start looking at the United States REIT sector as a bell-weather ahead of a recovery.

And we’re already starting to see some positive movement. Since July, the iShares Real Estate ETF (NYSE:IYR) has gained almost 10%, excluding dividends. It’s the same story for most banks over the same period, boosted by the Securities and Exchange Commission (SEC) short selling ban.

The U.S. REIT sector is worth watching carefully. The sector has already been trashed and – from a technical perspective – appears to have formed at least a short-term bottom in late July. Sentiment should improve following the bailout bill.

Still, the country is now in an economic recession and the ongoing contraction might last longer than average recessions because of the massive accumulation of debt and leverage-loan financing.

Pacific REITs will likely be forced to consolidate in the months ahead and that will pose regulatory challenges to corporate charters and shareholders. It’s too early to buy Asian REITs.

Europe, on the other hand, now faces a deeper credit squeeze as bailouts and a new wave of failures comes home to roost. The United Kingdom, Ireland, Spain and Denmark are all home to big real estate busts and it’s spreading. It is unlikely European REITs will bottom until at least late 2009.

Best Buys in Spain, US Foreclosures

For individual investors – especially dollar-based investors – the ongoing contraction in sun-belt values across the Spanish coast looks appealing.

The U.S. dollar is mustering a powerful bear market rally since its July lows, and it’s already soared more than 13% over the last 10 weeks against the euro. Combined with lower interest rates across the Eurozone later this fall or into 2009, financing costs should become more affordable for prospective buyers in the popular Costa del Sol region.

The United States can expect more government auctioned foreclosures in 2009, and that means big bargains for speculators and investors alike. Banks are desperate to remove non-performing loans from their clogged portfolio of real estate deals.

The last bear market in U.S. residential property in the early 1990s resulted in a plethora of deals for distressed buyers in Florida and California, among other states. This bout of real estate deflation now widespread across many regions will result in even greater bargains.

It’s no wonder Europeans have been active buyers of U.S. real estate since 2007 during a strong euro until recently. Now it’s time for Americans to buy domestic, too.

Source: Global REIT Boom Ends with a Thud, and Now It’s Time to Pick up the Pieces

Investors have fled the real estate market over the last year. But Andrew Snyder says the best time to invest in a sector is when it’s beaten down and oversold.

REIT Associated Estates Realty (NYSE:AEC) allows investors to bet on the housing recovery without the need to buy and sell property. It also pays healthy dividends in the meantime.

This from Andrew in Today’s Financial News:

Call up a real estate agent today and ask them what they are doing. Chances are, they are either at a bar drowning their sorrows or, if they are smart, they are putting the finishing touches on their resume.

The high-flying days when homes sold themselves for more than their asking price and just about anybody could be a successful realtor are over. The brutal headwinds of a slowing economy, a crazy-tight credit market, and the collapse of a major industry bubble are shaking all but the most successful realtors from the vine.

I called on a very prominent local realtor today. While you could tell she was glad to have a reputation strong enough to keep her in business, she is really worried about the mortgage industry.

“I have buyers that can easily afford these homes and are getting great deals, but we have to jump through hoops to be able to get them a mortgage,” she told me.  “Yesterday, I had a settlement that required three attorneys just to handle the lender’s outrageous requests.”

The credit crisis is threatening to topple what is left of the real estate industry.

Painful news

Look at the figures trickling out of the sector this week. Home prices in July fell more than 16% from where they were at the same time last year.

That means if a person bought a $300,000 last year with zero money or even ten percent down, they are almost certainly sitting on an upside-down mortgage, as the house is worth just $252,000.  It will take years to gain any real equity on that house. Those buyers will be financially handicapped for the rest of their lives.

Whose fault is it? It is certainly not mine or yours as everyday responsible taxpayers, but that is an entirely different subject.

Whenever you have major turmoil in an industry and such a dichotomy between winners and losers, there is always a profit opportunity. That means it is time to go shopping for real estate.

One of the best ways to invest in the industry without the hassle of buying and selling homes or land is to purchase shares of a real estate investment trust, commonly called REITs. The trusts use their investor’s money to take a stake in real assets and do all the hard work. All the investors need to do is sit back and cash their semi-annual dividend checks.

Invest in what?!

After hearing all the horrendous news about the crashing real estate market lately, most investors are scared to even mutter the word REIT, let alone invest in one. That is exactly what makes this a great profit-making opportunity.

Remember my cardinal rule: Invest when no one is looking.

Take a look at Associated Estates Realty (NYSE:AEC). The trust is paying an annual dividend of 5.5%. It is a safer yield than many equity investments right now. It is a return impossible to meet in the cash markets. And the appreciation potential is far greater than any debt note.

As the real estate industry bottoms out and starts to rebound, nearly every REIT will appreciate in value and its payouts will increase. Many financial experts argue REITS almost always lead the economic rebound, as the nation puts money back in their houses before their 401(K)s.

The key to finding the right REIT is to find the one with the best property holdings, with the best management and the best leverage. I like Associated Estates because of the combination of its high profits and therefore high-dividend yield (all REITS must pay out the vast majority of their earnings to shareholders) and its long-term net asset growth rate of over 25%.

The trust is growing at a very fast and very profitable rate. As the market turns around, the REIT’s fairly high leverage ratio will allow it to exponentially increase its profitability.

By no means is this the only REIT worth buying right now, but it is one you should pay attention to. If you do your homework, you should easily find many more that suit your needs.

Just because an industry is in the dumps right now does not mean it will be in two or three years. Remember, this is a highly cyclical economy. Real estate prices will be soaring before you know it.

And if you follow my advice so will your REIT investments.

Source: Real Estate Crash: Invest in REITs and Win

Eric Roseman doesn’t think so. “You can’t really make a long-term bullish case for the buck right now,” says Eric in The Sovereign Society.

However, as the eurozone and Japanese currencies weaken on slowing growth, Eric says now is a great time to buy into distressed US debt, real estate and stocks…

This from Eric:

The dollar has gained against global currencies since August 8, when Germany’s mighty economy contracted in the second quarter, triggering one of the biggest dollar rallies in years.

And maybe it was time for a rally. Since peaking more than six years ago versus the world’s major currencies, the U.S. dollar has posted some dizzying declines. Only a few currencies in the world have actually declined in value against the sad buck since late 2001…one of which being the Zimbabwe dollar.

But this current bout of dollar strength has more to do with the surprising weakness of other foreign economies than a resumption of U.S. growth. We’re simply ahead of the curve.

The market views the dollar as a leading currency as other economies begin to grapple with an economic slowdown or, in some cases, recession. The United States has already gone through the process of priming the economy with interest rate cuts and fiscal measures to boost consumption, driving the dollar lower in the process.

Now it’s the turn of the Europeans and Japanese. They are only now starting to enter slowdowns in their economic cycles.

That means they’ll be cutting rates, so their currencies will weaken. And the value of their assets – in dollar terms – will decline.

Therefore, savvy investors in the next few months will look to build positions in some of the U.S. economy’s most beaten-down, oversold assets. Specifically, foreign and U.S. investors alike can find significant value and opportunity in distressed U.S. debt, real estate and stocks.

Let’s look at the debt first…

PIMCO Scoops Fannie and Freddie Debt

Some of the best values now lie in distressed mortgage-backed securities like Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE) bonds. PIMCO, the world’s largest bond fund manager with over US$800 billion in assets, has been aggressively accumulating the debt of both lenders.

Credit spreads for government mortgage agency debt have surged over the last few months and now trade at their highest levels in history compared to Treasury bonds. Premiums are now trading at just under 300 basis points or 3%.

The government has already guaranteed that both crisis-plagued mortgage lenders won’t fail. That means Fannie Mae  and Freddie Mac debt is cheap at current prices, even though shareholders are likely to get wiped-out if the government eventually nationalizes Fannie and Freddie.

And as the mortgage market goes, so goes the real estate market…

Buying Up Busted Properties

U.S. real estate also offers excellent values, particularly from rising foreclosures and bank repossessions. This is exactly what occurred in the 1989-1991 Savings & Loan crisis. Then several years later, vulture investors earned big profits from buying cheap properties.

In the most devastated real estate markets of Nevada, Arizona, California and Florida, investors can find an abundance of residential and even a growing universe of commercial properties gone bust.

To be sure, financing has grown more difficult for even the most creditworthy of borrowers as banks balk at lending. But many deals will be closed in the coming months and years, as banks grow increasingly desperate to get rid of a truckload of properties at fire-sale prices.

Real estate in the United States is extremely cheap when priced in euro, yen or most other currencies. In 2007, more than 20% of all residential property purchased in Manhattan was by Europeans. I expect that trend to accelerate in 2008, especially if the euro continues to soften.

U.S. Stocks Offer Some of the Best Values in Global Markets - Especially When Accounting for Currency Changes!

Lastly, U.S. stocks offer big values compared to other markets because of the potential for higher currency-adjusted returns.

Over the last seven years, dollar-based investors have earned big profits in overseas stock markets, using the dollar’s decline to rack up huge currency-adjusted gains in foreign stock prices. But the opposite might occur now similarly to the 1995-1999 period, when U.S. markets outperformed foreign markets.

Therefore, I expect U.S. stocks to finally benefit from a surge in foreign institutional money after years of net outflows. I also think the huge inflows into foreign equity funds will slow markedly over the next 12 months as mutual fund investors redirect capital to domestic funds, which have badly lagged behind other markets.

Source: Dollar Rally Is Likely a Short-Term Phenomenon

The euro was hit by weakness in the German economy. The Munich-based Ifo Institute’s closely followed business sentiment index plunged in August, falling to a three-year low of 94.8 from 97.5 in July. Economists’ expectations had been for a more modest decline to 97.1.

Thus, “we believe the current dollar rally still has legs, we would recommend staying long dollars vs. the rest of the world,” wrote Win Thin, senior currency strategist at Brown Brothers Harriman.

The release of minutes from the FOMC’s August meeting present a much stronger sense of worry about growth than the Fed’s policy statement suggested when it was released just after the meeting ended.

Fed officials, the majority of whom voted to hold rates steady, saw a more-likely chance of a slowdown in economic growth in coming months than a pickup in inflation, and they believe that this slower growth should cool inflationary pressures.

The housing market remains grim, no matter how you slice it. U.S. home prices fell a seasonally adjusted 1.4% in the second quarter, the Office of Federal Housing Enterprise Oversight reported Tuesday. That was less than the 1.7% drop during the first three months of the year, however prices were down a record 4.8% in the second quarter of 2008, year over year.

Further complicating matters, a similar price index released by Standard & Poor’s earlier yesterday reported that home prices had fallen 15.4% in the second quarter on an annualized basis.

Source: Dollar Strengthens, Weak German Data Send Euro Lower

“For now, we expect range-trading and consolidation to continue, but we believe that the buck will resume its strengthening trend,” wrote currency strategists at Brown Brothers Harriman.

Matthew Strauss, of RBC Capital Markets, wrote that, “Following the sharp sell-off since mid-July, euro/dollar seems to have entered a new range of $1.4650 to $1.4910. The pair has been trading in this range since mid-August, with only brief and shallow breakouts.”

In the day’s biggest number, the National Association of Realtors reported that sales of existing homes ticked up 3.1% last month to the highest level in five months, exceeding economists’ expectations.

Offsetting that, though, the NAR said July’s inventory of unsold homes on the market rose 3.9% to a record 4.67 million units, representing a supply of 11.2 months based on the current sales pace.

And that may not tell the whole story.

“Inventories are very high relative to sales rates, and would probably be even more so if all those wishing to sell their home actually had the house on the market instead of pulling it off in the face of weak demand and eroding prices,” said Josh Shapiro, chief U.S. economist at MFR Inc.

Source: Dollar Strengthens a Little, Headline Home Sales Look Good, but Inventory of Unsold Homes Grows

• Sales of existing homes rose in July, climbing 3.1% to a seasonally adjusted annual rate of 5 million units. Sales were expected to rise by only 1.6%, according to economists surveyed by Thomson/IFR, The Associated Press reported. Prices were down significantly from a year ago, as the median price for a home sold in July dropped to $212,000, down by 7.1% from 2007.

• U.S. investment bank Morgan Stanley (MS) said yesterday (Monday) its Saudi unit signed the kingdom’s first swap agreement, a vehicle that allows foreigners to buy into listed stocks through intermediaries, Reuters reported. “Interest from international investors … is very high, and we expect to see a lot more interest in these swap transactions from investors around the world,” Craig Niven, a managing director at Morgan Stanley, said in a statement.

• Former Treasury Secretary Robert Rubin yesterday (Monday) joined Citigroup Inc. (C) as the company’s “senior counselor.” Rubin will give up the chairmanship of the executive committee, which is being dissolved, but will remain on the board. Rubin served as an economic adviser to President Bill Clinton in 1993 and 1994 and was Treasury secretary from 1995 to 1999.

• Shares of Ford Motor Co. (F) touched their lowest price in more than 22 years yesterday (Monday). The company closed at $4.41 a share down six cents, or 1.34%, after earlier falling as low as $4.35 in afternoon trading.

• Crude for October delivery increased 52 cents to close at $115.11 a barrel on the New York Mercantile Exchange after a volatile day of trading, MarketWatch reported. The October oil futures contracts traded between $113.68 and $116.06 on concerns that a Caribbean storm could affect supplies. The National Hurricane Center said yesterday (Monday) that a tropical depression in the Caribbean has strengthened into Tropical Storm Gustav.

• Advanced Micro Devices Inc. (AMD) yesterday (Monday) announced it sold its digital-television chip business to Broadcom Corp. (BRCM) for $193 million. Broadcom hopes to return the loss-generating unit to profitability and expand its presence in the digital TV market, The Financial Times reported.

• A federal appeals court breathed new life into Star Scientific Inc.’s (STSI) patent lawsuit against R.J. Reynolds Tobacco Co., a unit of Reynolds American Inc. (RAI). The U.S. Court of Appeals for the Federal Circuit, based in Washington, D.C., ruled yesterday (Monday) that a federal trial judge in Maryland was wrong in deciding that Star Scientific’s patents were unenforceable, DowJones reported.

• Gold sank yesterday (Monday) in a quiet trading day as the dollar’s rise led to profit taking by investors. “I think gold is finding its base here. It’s mostly technical support holding prices above $820. Any dips below $820 are seen as a buying opportunity,” Carlos Sanchez, precious metals analyst at the CPM Group in New York, told Reuters.

Source: Global Investing Roundups Tuesday, August 26th, 2008