“Holy Sheetrock, Commerce Dept!
Today’s economic data, in the form of housing starts, illuminate a point I’ve touched on recently, which is the sad reality that government data are nearly useless. The Commerce Department would have us believe that housing starts actually increased 5% last month — when virtually all publicly traded homebuilders have discussed the serious weakness in their orders.
While I suppose it’s possible that the homebuilders have essentially said: Damn the torpedoes, full-speed ahead and continued to start new homes, even as orders drop, that will only make matters worse. In either case, today’s starts data do not accurately reflect the current reality of the homebuilding business.
Were it not for the fact that government data — distorted as they are — matter to those who trade markets that I care about, I would ignore these statistics altogether. So, for folks who are making decisions based on government data, be forewarned.”
