The market looks to be opening roughly flat this morning, lacking anything earth-shattering in the news department to drive it in either direction.

Consumer spending grew slower than expected (0.3%) and the PCE came in inline, which took a bit of pressure off, but neither the bond market or the futures responded much. Income came in up 0.7%, which sounds good - but where is all the illegal immigrant labor? Oh wait - they don't count in the statistics, right?

American Home Mortgage (AHM) reported this morning, with 1Q Net down 44%. Earnings came in at 54 cents, down sharply from a year ago at $1.02. Again, let's not forget that the "mess" only really started in March, so this was a 50% haircut on earnings with nothing more than one of three months in the ditch. They also cut forecasts.

Of course, bad news is good news, and the stock is up in the premarket by about 80 cents. We'll see what the trading day brings there.

Radio Shack reported sharply higher net income, most of it related to staff reductions. Cost cutting helps quite a bit, but it doesn't do anything for revenue - that was off 14.5% year-over-year. Same store sales fell 9.2%, which is not good.

On the banking front generally, RBS' attempt to topple the ABN deal looks to be gaining steam, with RBS lining up financing to power their bid. This looks to be an interesting catfight, with lawsuits and a hostile interloper. Beware if this deal blows up though - that sort of thing tends to make for a real mess.

And finally, if you're not scared enough of leverage, perhaps this will tweak you a bit. It should. Combining increasing leverage with weakening lending standards is a recipe for disaster, and there's no reason to believe that this sort of stupidity is going to end any differently this time than it did the last 99 times.

Total leverage at US equity firms appears to be quite close to $5 trillion, which is 2.5x what it was in 2002. Most of this increase seems to have come from hedge funds and private equity firms, which is a particularly dangerous development, as they have a habit of making big bets - and when they go wrong, things can snowball fast.

It appears that CDS Swap prices are starting to trend up a bit again... while this is not yet at the "ominous" level, this indicator tends to lag an "event" - so its dangerous to try to use it as a predictor, as what tends to spike it is rumors of a potential default (or a real one!)

Up at 10:00 is housing data which may move the market hard. This will be an important number, because it will be the first month in which the full mess of the financing implosion will be recognized, albeit only with about a 50% impact. If it come in very weak, it could spark a big selloff.

Overseas China is about to shut down for a week for their "May holidays." The Nikkei was closed last night; Asia had a mixed bag with China being up modestly and most of the rest of the board finishing red.

More after the housing numbers come out......