It does appear that Wall Street is pretty happy with the way the world looks this week. U.S. macroeconomic data is only part of that picture, of course, but to the extent that it is I think Dean Baker makes good sense:

The Commerce Department's data did show better than expected durable good orders in March, but this was following very weak reports in January and February. Year over year, durable good orders are still down by more than 3 percent in nominal terms... Against a backdrop of serious weakness, a better than expected month is always good news, but it seems a bit excessive to make too much of this very erratic data.

The other cause for celebration was a 22,000 increase in the rate of new home sales in March, measured against a downwardly revised February level. The basis for the celebration here escapes me. The consensus forecast was for a considerably larger bounceback from the weak February level. Even with the uptick, March sales were the slowest since the recession, excluding February. And the small uptick was almost certainly driven by weather...

But I'm finding some comfort in a Wall Street Journal article (hat tip to Calculated Risk) titled "Home Equity Stalls" (page D1 of the print edition):

After years of piling debt on their homes, Americans are becoming more cautious about using them as a piggy bank.

A cooling housing market and higher interest rates have made homeowners more reluctant to tap the equity they may have built up in their residences...

Now, the slowdown in home-equity borrowing is leading to weaker sales in some markets for autos, building materials and electronics, says Mark Zandi, chief economist of Economy.com.

Barry Ritholtz sounds off on that last theme, and Calculated Risk is beginning to worry about a consumer-led recession.  So why would I feel encouraged?  The WSJ article continues:

Lenders are responding to slowing demand for home-equity borrowing by boosting their marketing, unveiling special offers and focusing on traditional uses of home equity, such as home improvement and debt consolidation. Wells Fargo this week rolled out a "Home Improvement Program" that gives home-equity customers discounts at retailers such as Best Buy, Brookstone and LampsPlus.com and access to a network of third-party local contractors.

J.P. Morgan Chase & Co. is running its first cable-television advertising campaign for home-equity borrowing, focusing on the product's flexibility. It's also rolling out a training program designed to help bankers in Chase branches do a better job of selling home-equity products. Bank of America, has launched a "green" home-equity card program, in which the bank will make a $100 donation to environmental group Conservation International on behalf of new home-equity customers who use their equity-line Visa card for purchases of $2,500 or more.

In my view, the biggest threat from housing-sector woes has all along been the possibility of spillovers into credit markets -- the kind that can restrain economic activity even after consumers and businesses shake off some of the caution that the stress of uncertainty inevitably brings.  Several posts back I offered the opinion that a lack of available credit does not seem to be the driving factor behind weak growth in business investment.  Today's story suggests that the same may be true of consumers.  And that may just be the difference between a soft patch and downright ugliness.