Housing - Down and Out?
I've held the view that this so-called economic recovery has been a lot weaker than the usual suspects have proclaimed.
(a quick search using the form in the LH column will give you a few dozen mentions)
This morning the Census Bureau released it's June 2004 numbers concerning new housing activity.
It's not pretty.
I'll give you the highlights as I see them.
As the housing market and consumer spending were the two legs holding this fragile economy together, if these housing start figures prove to be more than an aberration, then this could prove very damaging to the so-called economic recovery.
"The recent weak patch of economic news for June, on consumer spending, employment and industrial production, has not dented most economists' view of an economy reaching cruising speed". So reads a snippet of this Reuters' article detailing some poll numbers of economists' expectations for the balance of this year and next.
Me, I'm not an economist, but I do watch broad indicators of economic activity. I'd say that the glass is half-full, and someone's treating themself to a quenching drink.
The $64,000 question is of course, who is correct? Or are we all wrong?
I would be remiss if I didn't mention that the University of Michigan's Consumer Confidence Index rose slightly for July. Consumers are slightly more optimistic about the near future than in June, but will they continue to spend? Do they have any more credit with which to continue to spend?
Wages have lost money to inflation, and personal debt is at or near all-time record levels. Energy and food costs are way up, and this of course erodes consumers abilities to purchase hard goods - durables.
So, I'm less sanguine than the surveyed economists. This is not news. Time will tell if any of us are reading the tea leaves accurately. I use the price of copper as a measure of economic activity. While copper prices remain high, it is off it's peak, and the trend is beginning to turn murky. Copper could go either way at this juncture.
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Iran? Show me.
So, if some the 9-11 hijackers merely passed through Iran on their way to wherever, that's a lot less aid than the U.S. gave all of them. Now that's ugly.
(a quick search using the form in the LH column will give you a few dozen mentions)
This morning the Census Bureau released it's June 2004 numbers concerning new housing activity.
It's not pretty.
I'll give you the highlights as I see them.
The number of homes already in the process of being built remains at high levels, but, and this is a big butt, building permits crashed.
- Construction of new homes in the U. S. slowed in June, falling 8.5 percent from May to a seasonally adjusted annual rate of 1.802 million.
- Starts of new single-family homes declined 9.5 percent in June to 1.489 million seasonally, the lowest level since May 2003.
- Building permits, a forward looking indicator, for single-family houses slid 6.2 percent to 1.51 million.
- Overall building permits tumbled 8.2 percent to 1.924 million units. It's the sharpest decline in permits in 10 years.
- Over the past five months, housing starts have averaged 1.926 million, down from last month's 1.952 million.
As the housing market and consumer spending were the two legs holding this fragile economy together, if these housing start figures prove to be more than an aberration, then this could prove very damaging to the so-called economic recovery.
"The recent weak patch of economic news for June, on consumer spending, employment and industrial production, has not dented most economists' view of an economy reaching cruising speed". So reads a snippet of this Reuters' article detailing some poll numbers of economists' expectations for the balance of this year and next.
Me, I'm not an economist, but I do watch broad indicators of economic activity. I'd say that the glass is half-full, and someone's treating themself to a quenching drink.
The $64,000 question is of course, who is correct? Or are we all wrong?
I would be remiss if I didn't mention that the University of Michigan's Consumer Confidence Index rose slightly for July. Consumers are slightly more optimistic about the near future than in June, but will they continue to spend? Do they have any more credit with which to continue to spend?
Wages have lost money to inflation, and personal debt is at or near all-time record levels. Energy and food costs are way up, and this of course erodes consumers abilities to purchase hard goods - durables.
So, I'm less sanguine than the surveyed economists. This is not news. Time will tell if any of us are reading the tea leaves accurately. I use the price of copper as a measure of economic activity. While copper prices remain high, it is off it's peak, and the trend is beginning to turn murky. Copper could go either way at this juncture.
************************************
Iran? Show me.
So, if some the 9-11 hijackers merely passed through Iran on their way to wherever, that's a lot less aid than the U.S. gave all of them. Now that's ugly.
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