Single-Family U.S. Home Construction at 17-Year Low; Manufacturing Shrinks

[Purveyor]

Source: Bloomberg

By Timothy R. Homan and Courtney Schlisserman

July 17 (Bloomberg) -- Builders started work in June on the fewest single-family U.S. homes since 1991 and manufacturing in the Philadelphia region contracted for an eighth straight month, signaling the economic slowdown is worsening.

Construction starts fell to an annual pace of 647,000, the Commerce Department said today in Washington. A change in New York City building codes spurred total starts, which include condominiums and apartment buildings, to a four-month high.

The figures underscore the housing recession was already deepening before the financial turmoil this month at Fannie Mae and Freddie Mac threatened to further curb mortgage financing. Today's drop in the Philadelphia Federal Reserve's factory gauge showed manufacturers cut orders and employment in July as confidence in the economic outlook deteriorated.

``Hopes for a bottom'' this year in home construction ``are rapidly fading,'' said David Resler, chief economist at Nomura Securities International Inc. in New York. The housing recession ``has been spilling over to manufacturing for months,'' contributing to ``recessionary conditions,'' he said.

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``As manufacturers see the final demand for their products go down and inventories go up, they have to slow production and that means less employment,'' said Kevin Logan, senior market economist at Dresdner Kleinwort in New York in an interview with Bloomberg Television. ``The pricing numbers are important too because it indicates that we're in a period of stagflation.''

Read more: http://www.bloomberg.com/apps/news?pid=20601103&sid=aaYaMnGNn1Z0&refer=us

[Warpy]

1. And which family controlled the government 17 years ago?

Oh, right...

[Indenturedebtor]

2. Bwahahahah so true!

At least though you won't have new construction driving prices down any more.

[northernlights]

3. and with lower new home construction

comes lower demand for big ticket items like oven/stoves,, refrigerators, washers, dryers and so on. So more layoffs, and the downward spiral deepens.

Thank you so much, babybush, for beating out poppybush again.