OH, THOSE DEFICITS....:

U.S. Housing Activity Up 4.7 Pct. in Jan. (MARTIN CRUTSINGER, 2/16/05, The Associated Press)

Construction of new homes and apartments rose 4.7 percent in January to the highest level in over two decades as low mortgage rates continued to power the nation's housing industry.

The Commerce Department reported Wednesday that builders began construction on 2.16 million units at a seasonally adjusted annual rate last month, up from a rate of 2.06 million units in December.

The January increase caught economists by surprise. They had been forecasting a decline of around 3.7 percent, reflecting rain in the West and winter storms in the East, which had been expected to hold down construction activity.

Instead, builders, enthused by continued low mortgage rates, broke ground on the largest number of new homes and apartments since February 1984 when construction starts hit an annual rate of 2.26 million units.

Economy of Japan slips into recession (Todd Zaun, February 17, 2005, The New York Times)

The Japanese economy slipped into recession last year, as consumer spending weakened and exports stalled, government data showed on Wednesday.

Gross domestic product contracted at an annual pace of 0.5 percent in the fourth quarter, a sharp contrast to the 0.5 percent growth predicted by economists, as inventories of some electronics goods piled up and consumption remained weak despite a rosy job outlook.

Coming a day after a report that the euro-zone economy barely grew in the fourth quarter as the German economy unexpectedly contracted, the Japanese data suggest widening imbalances between the world's biggest economies.

Yet the MSM still can't figure out why ours is the only economy anyone wants to buy into.

Posted by Orrin Judd at February 16, 2005 8:11 AM