The Construction Euphoria Is Over

Click to enlarge.

Those anxiously awaiting the next construction boom may have to wait a very long time. As seen in the chart, we're still sitting at the very top of the long-term exponential decay channel.

Is this really as bad as it looks?


Click to enlarge.

As seen in the chart above, the answer would probably be yes. It is as bad as it looks. The uptrend from the pit of despair (November 2009) is over. Now we're heading back down again. Further, we're actually below the declining trend line.

For what it is worth, I am still firmly in the permabear camp. I cannot understand the optimism in the face of overwhelming long-term evidence to the contrary.

August 1, 2013
Stock market roars to record highs, S&P 500 closes above 1,700 for first time

Because the stock market often looks ahead 6-9 months, it’s not unusual for stock indexes to be ahead of economic indicators, when the economy is improving or worsening. Right now, stock investors may be anticipating a stronger economy and better earnings next year.

It can "roar" without me, just like it did from 2004 to 2007. This is not investment advice.

Source Data:
St. Louis Fed: All Employees: Construction / All Employees: Total nonfarm
St. Louis Fed: Real Total Construction Spending Growth per Capita