Today the Census Bureau released two reports that illustrate how rough this recovery will be.
August new home sales (http://www.census.gov/const/newressales.pdf) of 429,000 were about one-third greater than their January trough of 329,000. But look at the following chart for perspective. We remain two-thirds below the peak of several years ago. It will be a long, hard slog back to robust growth.
Chart 5.9 New Home Sales
(Click on image to enlarge)
Recessions shaded
New orders for nondefense capital goods tell essentially the same story (http://www.census.gov/indicator/www/m3/adv/pdf/durgd.pdf). August’s $52.7 billion remains in the trough. And the following chart makes clear that this trough is as bad as the 2001 dot-com bust and that today’s report is hardly better than readings from 15 years earlier.
Chart 4.1 New Orders for Nondefense Capital Goods
(Click on image to enlarge)
Recessions shaded
Finally, yesterday the National Association of Realtors reported August home sales of 5.1 million. A glance at the chart below only reinforces the impression created by today’s data releases. We have a long ways to go.
Chart 5.8 Existing Home Sales
(Click on image to enlarge)
Recessions shaded
(The charts were taken from http://www.beyourowneconomist.com. [Click on Seminars and then Charts.] Go there for additional charts on the economy and a list of economic indicators.)
© 2009 Michael B. Lehmann
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