The Dow is up 100 points this morning on a report from the National Association of Realtors that home sales rose in December. There are multiple reasons for skepticsm. The market has been faked out by trivial or misleading economic reports before. The NAR is not a fount of quality, unbiased information. December is a slow month for home sales anyway, meaning a relatively small bump could get blown out of proportion in NAR's seasonal adjustment, which attempts to extrapolate the trend of one month to a full year.

But the raw, nonadjusted numbers look good enough to suggest that last month's dip in mortgage rates is starting to have an effect. Actual, unadjusted December sales of existing homes (as opposed to nonexisting, hallucinated homes?) were 364,000 -- 4,000 MORE than were sold in December 2007. The biggest bump came in the west -- 90,000 homes sold last month vs. 66,000 in December 2007. December isn't as slow as I would have guessed -- the biggest months last year were June and July, with 504,000 houses sold in each month.

But there are still far more homes on the market than buyers, and prices need to fall even more. A huge portion of these sales are out of bank foreclosures. A recent bump in mortgage rates isn't helping.