The 2020 Mid-Year Economic Update_long

Day: June 16, 2009

Housing Starts See a Bump in May

Housing starts went up 17.2% in May to an annual rate of 518,000, compared with April, according to the latest figures from the U.S. Census Bureau and the Department of Housing and Urban Development.

The number is 45.2% below May 2008.

Single-family housing starts in May were at a rate of 401,000, 7.5% above April. The May rate for units in buildings with five units or more was 124,000.

Housing units authorized by building permits were at a seasonally adjusted annual rate of 518,000, 4% above April and 47% below May 2008. Single-family authorizations in May were 7.9% above April. Authorizations of units in buildings with five units or more were at a rate of 92,000 in May.

Privately-owned housing completions in May were at a seasonally adjusted annual rate of 811,000, 3.3% ...

Industrial Production Falls 1.1% in May

Industrial production decreased 1.1% in May after having fallen a downward-revised 0.7% in April, according to the Federal Reserve. The average decrease in industrial production during the first three months of the year was 1.6%.

Manufacturing output moved down 1.0% in May with broad-based declines across industries. Outside of manufacturing, the output of mines dropped 2.1%, and the output of utilities fell 1.4%.

At 95.8% of its 2002 average, overall industrial output in May was 13.4% below its year-earlier level. The rate of capacity utilization for total industry declined further in May to 68.3%, a level 12.6 percentage points below its average for 1972-2008. Prior to the current recession, the low over the history of this series, which begins in 1967, was 70.9% in December ...

Wholesale Prices Move Up 0.2% in May

Wholesale prices moved up 0.2% in May, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported. At the earlier stages of processing, prices received by producers of intermediate goods rose 0.3% following a 0.5% decline a month earlier, and the crude goods index climbed 3.6% after rising 3% in April.

In May, a 2.9% increase in finished energy goods prices more than offset a 1.6% decline in the index for finished consumer foods and a 0.1% decrease in prices for finished goods other than foods and energy.

Before seasonal adjustment, the Producer Price Index for Finished Goods increased 0.5% in May to 170.8 (1982 = 100). From May 2008 to May 2009, finished goods prices decreased 5%. Over the same period, the finished energy goods index fell 27.3% and ...

Research Firm: Global Trade May Have Already Hit Bottom

Numbers released by Panjiva, a firm that tracks overseas suppliers, show an uptick of 2% in the number of global manufacturers shipping to the U.S. market in May. It is the third monthly increase in a row.

The firm reports a metric that tracks manufacturers that have suffered a 50% or greater decline in volume shipped to U.S. customers in the most recent three-month period, versus the same period a year ago. These manufacturers are on the Panjiva Watch List. "Significant manufacturers" are those that have shipped 10 or more shipments to the U.S. over the past year. "Significant buyers" are those that have received 10 or more shipments from overseas manufacturers in the past year.

According to Panjiva, the number of ...

Building Materials Holding Corp. Files For Ch. 11 Bankruptcy Protection

Building Materials Holding Corporation, Boise, ID, a provider of building materials and construction services to professional residential builders and contractors, has filed for Chapter 11 bankruptcy protection after reaching an agreement with secured lenders on a restructuring plan.

Currently, there are no plans to close any additional facilities or reduce employment levels because of the filing. The company has closed several facilities in the past year, including the discontinuation of its wholly owned subsidiary SelectBuild Florida.

BMHC plans to continue to operate as usual while it implements the pre-negotiated restructuring plan. The distributor has received commitments for $80 million in debtor-in-possession financing for the process.

Under the proposed plan, BMHC's ...

Western Tool Supply Files for Ch. 11 Bankruptcy Protection

Western Tool Supply, Salem, OR, filed for Ch. 11 bankruptcy protection on June 9, 2009, in Oregon Bankruptcy Court, attributing the company's tight position to an "acute shortage of operating cash, together with long-term leases that no longer reflected a market rate in a rapidly-declining commercial real estate market."

According to a June 10 filing, submitted to the court by President Kevin Kiker, the distributor of tools, fasteners and related parts to contractor customers has seen sales drop "precipitously" in 2009. Gross sales in 2007 were $67.5 million, and in 2008 fell to $50.8 million. No figure was provided for year-to-date sales in 2009.

Kiker founded Western Tool in February 1982, operating out of his garage in Jefferson, OR, according to the filing. In June 1982, he moved ...