Housing starts look positive in September from August but not after taking into account a downward revision to the prior month. Housing starts in September rose 0.5 percent, following a revised 1.0 percent decline in August. The September pace of 0.590 million units annualized was down 28.2 percent year-on-year and fell short of the consensus forecast for 0.615 million units. Importantly, August was revised down from 0.598 million units to 0.587 million units annualized. The advance in September was led by the single-family component which increased 3.9 percent after dropping 4.7 percent the month before. In contrast, the single-family component fell 15.2 percent after rising 20.7 percent in August.
Here is the chart:
Click for a larger image.
I love it when a number comes higher, but below expectations. I just find it laughable that anyone listens to economic forecasters to that degree.
Anyway -- the main issue with the above chart is this: there is more evidence of the housing market bottoming. That's the main point.
4 comments:
The longer term picture is bleak though, as we are still off 75% from the peak and basically 66%+ from the levels we saw throughout the 90s. This is one that I just don't see coming back sharply and it will be a drag on the economy going forward.
Also, housing permits went down last month. Consumer confidence is beginning to fall, and the banks still aren't lending. Higher oil pirces will soon choke consumption spending. The economy may have started to contract again.
The Titanic bottomed too.
I think being bullish is a Pascal's wager: ignoring the realities of lost jobs, tight credit, medical bankruptcy, underwater houses, weak jobs, lowering wages and the general view with alarm of the forecasters.
The average consumer, the one that's always being quoted as seventy percent of the economy, is a very unhappy and nervous consumer.
AND
You're doing no one any good whipping up hopes of another reinflated bubble economy just so you can feel good about a maladjusted consumer.
How about some tough love?
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