Are happy economic days here again? Not quite

"As economic news goes, all the developments reported today would have to be described as positive. But the big picture hasn't changed much."

No dispute there. I hope you will get to the 'why,how and when' soon.

Perhaps it's time to re-think exactly what are our key economic indicators. While items such as the economic growth rate, unemployment and housing are all good, items Mr. Fox mentions such as income growth and rates of insured/uninsured should also be part of our measure. And our government needs to also correct itself and examine its own spending and role in our current economic woes.

So you mean the current economic policies have striven to improve benchmarks for gauging the economy rather than improving the economy itself?

It seems more and more like anytime a rule gets made for measuring progress, people strive for the rule rather than actual progress.

1) The decline in housing prices slowed in June, according to the latest S&P/Case-Shiller data.

I saw a month to month breakdown of the housing bust of the 1990's and it was fairly enlightening. The spring summer selling season frequently saw positive numbers come out of Case-Shiller. The housing market is very seasonal, many people buy houses in spring/summer to get into them before school starts so the kids can attend school in the new district and it's also easier to look at houses in nice weather.

Income growth in the 2000s has been excruciatingly slow (median household income, as reported by the Census Bureau, was still below its 1999 and 2000 levels in 2007)

This is why housing should be headed down to 1999, 2000 levels in real terms. We haven't had income growth to support the higher house prices. One of the more interesting graphs I saw showed that despite house prices skyrocketing the actual monthly payment didn't rise all that much due to financial "innovation." It puts it in perspective exactly why housing went up as high as it did.

http://mrmortgage.ml-implode.com/wp-content/uploads/2008/08/affordibility-custom.png

But mitigating this good news...

2) That is average (mean) income which is up, not necessarily the median.

3) while the number without health insurance fell, so did the number covered by private health insurance. This would seem to have more to do with the aging of America (and the Medicare that comes with) than any improving conditions (agiing and medicare are on autopilot and not responsive to current conditions).
Don't get me wrong, greater insurance coverage is good, but let's not congratulate 'the economy' for things it's not doing.