by Calculated Risk on 4/17/2010 07:54:00 PM

If we look at a long term graph of housing starts, we notice that there were more starts at the peak in the '70s than during the recent housing bubble. If we plotted housing starts per capita, or per total households, the surge in housing starts during the last decade would not look extraordinary at all (ht Dave).

But it was extraordinary ...

Click on graph for larger image in new window.

First, here is the long term graph of both total housing starts and single unit starts. Obviously there were many more multi-unit housing starts in the '70s - and that is a clue.

The key is household formation.

Household formation is a function of changes in population, and also of changes in household size. During the '70s, the baby boomers started moving out of their parents' homes, and there was a dramatic decrease in the number of persons per household. And that lead to a huge demand for apartments (the surge in total starts).

The second graph shows the persons per household since 1947. Persons per household has been declining for over a century, but there was a fairly sharp decline starting in the late '60s and all through the '70s.

More recently persons per household had been fairly flat. And there has been some recent research that suggests the household formation was lower, and therefore persons per household might even be higher, than the Census Bureau estimates. See from Amy Hoak at MarketWatch: Number of U.S. households falls by 1.2 million

Caveat: All of this data is rough, and it is difficult to get an accurate count of the housing stock.

Using the Census Bureau data we can calculate the impact the number of households needed because of 1) population growth, and 2) changes in household size:

Households Added due to Population Growth and Changes in Household Size
Decade	Due to Population Growth (millions)	Due to Change in Household Size (millions)	Persons per household, ending
50s	8.4	1.0	3.34
60s	8.0	2.5	3.19
70s	8.0	9.4	2.78
80s	8.5	4.9	2.62
90s	12.2	0.4	2.61
00s	11.0	1.7	2.57
Source: Persons per Household, Census Bureau XLS file

Because of the changes in household size, the U.S. needed far more additional housing units in the '70s and '80s than in the '90s and '00s. If we could normalize the housing start chart by household formation, we would see that the last decade was indeed extraordinary!

by Calculated Risk on 4/17/2010 03:12:00 PM

From Christina Romer, Chairman Council of Economic Advisers: Back to a Better Normal: Unemployment and Growth in the Wake of the Great Recession

My first and most fundamental point is that when it comes to the economy we are very far from normal. The unemployment rate is currently 9.7 percent. I find it distressing that some observers talk about unemployment remaining high for an extended period with resignation, rather than with a sense of urgency to find ways to address the problem. Behind this fatalism, there seems to be a view that perhaps the high unemployment reflects structural changes or other factors not easily amenable to correction. High unemployment in this view is simply “the new normal.” I disagree.

The high unemployment that the United States is experiencing reflects a severe shortfall of aggregate demand. Despite three quarters of growth, real GDP is approximately 6 percent below its trend path. Unemployment is high fundamentally because the economy is producing dramatically below its capacity. That is, far from being "the new normal," it is “the old cyclical."

In this regard, I am reminded of a frustration I have felt many times when people write books and organize conferences about the unemployment problem in the Great Depression -- as if the high unemployment were somehow separate or distinct from the rest of the Depression. Then, as now, the economy had been through a wrenching crisis that had caused demand and production to plummet. Unemployment was a consequence of the collapse of demand, not a separate, coincident problem.

Now, to be fair, the unemployment rate has risen somewhat more during this recession than conventional estimates of the relationship between GDP and unemployment would lead one to expect. In this year’s Economic Report of the President, we presented estimates that suggest that the unemployment rate in the fourth quarter of 2009 was perhaps 1.7 percentage points higher than the behavior of GDP would lead one to expect. Some of that unexpected rise goes away when one takes a more sophisticated view of GDP behavior. The Bureau of Economic Analysis estimates GDP in two ways -- one by adding up everything that is produced in the economy and the other by adding up all of the income received. These two measures should be identical. But in this recession, the income-side estimates have fallen substantially more than the product-side ones. Therefore some, but not all, of the anomalous rise in unemployment may be due to the fact that the true decline in GDP may have been deeper than the conventional estimates suggest.

The reason that I have been emphasizing that the high unemployment we are experiencing is cyclical rather than structural is not to somehow minimize or downplay it. In fact, just the opposite. It is to shake people out of the complacency that says, "That’s just the way life is." It may be the way life is right now -- but it doesn’t have to be. We have the tools and the knowledge to counteract a shortfall in aggregate demand. We should be continuing to use them aggressively.

by Calculated Risk on 4/17/2010 11:30:00 AM

I've started an archive of large images for most of the graphs posted on this blog. You can access the archive when you click on a graph (the larger image is part of the archive), or by clicking on "Graph Archive" in the menu bar.

A few examples - here are the most recent graphs for: housing starts, percent job losses during recessions, and New Home sales (NSA).

Note: The graphs are free to use on websites or for presentations. All I ask is that online sites link to my site, http://www.calculatedriskblog.com/, and printed presentations credit www.calculatedriskblog.com.

There are several methods to search for images.
1) There are tags at the bottom (like employment or housing starts)
2) There is an image archive at the bottom.
3) You can scroll through the images with the "Next" or "Back" buttons.

Suggestions? Enjoy!

by Calculated Risk on 4/17/2010 08:48:00 AM

First from Reuters yesterday: Consumer mood unexpectedly worse in early April

U.S. consumer sentiment took a surprise negative turn in early April due to a persistently grim outlook on income and jobs, a private survey released on Friday showed.
...
The surveys' overall index on consumer sentiments slipped to 69.5 in early April -- the lowest in five months. This was below the 73.6 reading seen at the end of March and the 75.0 median forecast of analysts polled by Reuters.

The article says "consumer sentiment is seen as a proxy for consumer spending", but I'm not sure. In 2005, Dr. Dean Croushore of University of Richmond argued consumer confidence is "essentially useless for forecasting Americans' spending patterns. ... consumer confidence just reflects the past. You lose your job, your confidence falls. There's not really anything new there."

Every time I see "consumer confidence", I think employment and gasoline prices ... and here are a couple of graphs to show the relationship:

NOTE: On the following graphs, the unemployment rate and gasoline prices are inverted since they are inversely correlated to confidence.

Click on graph for larger image in new window.

The first graph shows consumer confidence and the unemployment rate (inverted).

There is a strong correlation, although it appears confidence leads the unemployment rate (probably because layoffs stop before the unemployment rate starts falling). Maybe a better graph would be monthly changes in employment vs. confidence (I'll look at that later).

The second graph shows consumer confidence and real gasoline prices (CPI adjusted).

Although there are periods when confidence doesn't track gasoline prices, it does appear there is a relationship.

So my guess is the weak confidence reading tells us what we already know - unemployment is high and gasoline prices are rising.

by Calculated Risk on 4/16/2010 10:45:00 PM

This is an unofficial list of Problem Banks compiled only from public sources.

Here is the unofficial problem bank list for April 16, 2010.

Changes and comments from surferdude808:

The closures this week and publication of actions issued by the OCC during March contributed to a large number of changes in the Unofficial Problem Bank List this week.

There were 25 institutions with assets of $8.7 billion added this week while 9 institutions with assets of $6.4 billion were removed. The net of this activity results in an Unofficial Problem Bank List that has 698 institutions with combined assets of $366.5 billion, up from 682 institutions with assets of $364.1 billion last week.

The Unofficial Problem Bank List has mostly closed the gap with the latest FDIC Official Problem Bank List that included 702 institutions. Notable among the 25additions are Far East National Bank, Los Angeles, CA ($2 billion); BNC National Bank, Phoenix, AZ ($867 million Ticker: BNCC.PK); First Community Bank, National Association, Lexington, SC ($605 million Ticker: FCCO); Citizens National Bank of Paintsville, Paintsville, IL ($582 million Ticker: CZNL.OB); and Golden Bank, National Association, Houston, TX ($507 million).

The removals include an action termination by the Federal Reserve against KCB Bank ($143 million), and the 8 failures -- Riverside National Bank of Florida ($3.4 billion), City Bank ($1.1 billion), Tamalpais Bank ($629 million), First Federal Bank of North Florida ($393 million), Innovative Bank ($269 million), Butler Bank ($268 million), AmericanFirst Bank ($90 million), and Lakeside Community Bank ($53 million).

by Calculated Risk on 4/16/2010 09:28:00 PM

City Bank failure.
Not that one, nor that one...yet.
Not that one either.
by Soylent Green is People
From the FDIC: Whidbey Island Bank, Coupeville, Washington, Assumes All Of The Deposits Of City Bank, Lynnwood, Washington

As of December 31, 2009, City Bank had approximately $1.13 billion in total assets and $1.02 billion in total deposits.
...
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $323.4 million.... City Bank is the 50th FDIC-insured institution to fail in the nation this year, and the fifth in Washington. The last FDIC-insured institution closed in the state was Rainier Pacific Bank, Tacoma, February 26, 2010.

by Calculated Risk on 4/16/2010 08:50:00 PM

A dog eat dog world
Now banks eat banks nationwide.
Ms. Bair = Ms. PacMan?
by Soylent Green is People
From the FDIC: Union Bank, National Association, San Francisco, California, Assumes All Of The Deposits Of Tamalpais Bank, San Rafael, California

As of December 31, 2009, Tamalpais Bank had approximately $628.9 million in total assets and $487.6 million in total deposits.
...
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $81.1 million. ... Tamalpais Bank is the 49th FDIC-insured institution to fail in the nation this year, and the third in California. The last FDIC-insured institution closed in the state was Innovative Bank, Oakland, earlier today.

This bank made some really bad CRE loans, see from David Johnson: When smart money said "no more," not-so-smart Marin bank loaned the Lembis $41 million.

by Calculated Risk on 4/16/2010 08:12:00 PM

Innovative Bank
Nothing's new under the sun
Same mistakes, same end.
by Soylent Green is People
From the FDIC: Center Bank, Los Angeles, California, Assumes All Of The Deposits Of Innovative Bank, Oakland, California

As of December 31, 2009, Innovative Bank had approximately $268.9 million in total assets and $225.2 million in total deposits.
...
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $37.8 million. ... Innovative Bank is the 48th FDIC-insured institution to fail in the nation this year, and the 3rd in California. The last FDIC-insured institution closed in the state was La Jolla Bank, FSB, La Jolla, February 19, 2010.

by Calculated Risk on 4/16/2010 06:07:00 PM

Banks new built Rockies.
Soaring peaks of verdant green
All debt, I.O.U's.
by Soylent Green is People
From the FDIC: TD Bank, National Association, Wilmington, Delaware, Acquires All the Deposits of Three Florida Institutions

TD Bank, National Association (N.A.), Wilmington, Delaware, acquired the banking operations, including all the deposits, of three Florida-based institutions. ... AmericanFirst Bank, Clermont; First Federal Bank of North Florida, Palatka; and Riverside National Bank of Florida, Fort Pierce
...
As of December 31, 2009, AmericanFirst Bank had total assets of $90.5 million and total deposits of $81.9 million; First Federal Bank of North Florida had total assets of $393.3 million and total deposits of $324.2 million; and Riverside National Bank of Florida had total assets of $3.42 billion and total deposits of $2.76 billion.
...
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) for AmericanFirst Bank will be $10.5 million; for First Federal Bank of North Florida, $6.0 million; and for Riverside National Bank of Florida, 491.8 million.
...
These were the 44th, 45th, and 46th banks to fail in the nation this year, and the seventh, eighth, and ninth banks to close in Florida. Prior to these failures, the last bank closed in the state was Key West Bank, Key West, on March 26, 2010.

From the FDIC: People's United Bank, Bridgeport, Connecticut, Assumes All of the Deposits of Butler Bank, Lowell, Massachusetts

As of December 31, 2009, Butler Bank had approximately $268.0 million in total assets and $233.2 million in total deposits.
...
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $22.9 million. .... Butler Bank is the 47th FDIC-insured institution to fail in the nation this year, and the first in Massachusetts. The last FDIC-insured institution closed in the state was Ludlow Savings Bank, Ludlow, October 21, 1994.

That makes 5 today.

by Calculated Risk on 4/16/2010 05:22:00 PM

East wind torques bamboo
Summer monsoons wreak havoc
Bankers devastate.
by Soylent Green is People
From the FDIC: FDIC Approves The Payout Of The Insured Deposits Of Lakeside Community Bank, Sterling Heights, Michigan

As of December 31, 2009, Lakeside Community Bank had approximately $53.0 million in total assets and $52.3 million in total deposits.
...
Lakeside Community Bank is the 43rd FDIC-insured institution to fail this year, and the first in Michigan. The last institution closed in the state was Citizens State Bank, New Baltimore, on December 18, 2009. The FDIC estimates the cost of the failure to its Deposit Insurance Fund to be approximately $11.2 million

A small one to start the day ...

by Calculated Risk on 4/16/2010 03:07:00 PM

From Amy Hoak at MarketWatch: End of road for home-buy credit

Two groups that once lobbied strongly for the credit -- the National Association of Realtors and the National Association of Home Builders -- have no plans to make a push for its extension, according to spokesmen from both groups. And the word from NAR's government-affairs department is that another extension isn't in the cards.

The first round of the homebuyer tax credit was widely criticized by economists as inefficient and misdirected. The tax credit went mostly to people who would have bought anyway - and it just provided an incentive for people to move from renting to owning without reducing the overall stock of housing units.

The evidence suggests the extension was even more costly and inefficient than the original credit. So no further extension is good news for the economy ...

by Calculated Risk on 4/16/2010 11:31:00 AM

From the SEC: SEC Charges Goldman Sachs With Fraud in Structuring and Marketing of CDO Tied to Subprime Mortgages

The Securities and Exchange Commission today charged Goldman, Sachs & Co. and one of its vice presidents for defrauding investors by misstating and omitting key facts about a financial product tied to subprime mortgages as the U.S. housing market was beginning to falter.

The SEC alleges that Goldman Sachs structured and marketed a synthetic collateralized debt obligation (CDO) that hinged on the performance of subprime residential mortgage-backed securities (RMBS). Goldman Sachs failed to disclose to investors vital information about the CDO, in particular the role that a major hedge fund played in the portfolio selection process and the fact that the hedge fund had taken a short position against the CDO.

"The product was new and complex but the deception and conflicts are old and simple," said Robert Khuzami, Director of the Division of Enforcement. "Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party."
...
The SEC's complaint alleges that after participating in the portfolio selection, Paulson & Co. effectively shorted the RMBS portfolio it helped select by entering into credit default swaps (CDS) with Goldman Sachs to buy protection on specific layers of the ABACUS capital structure. Given that financial short interest, Paulson & Co. had an economic incentive to select RMBS that it expected to experience credit events in the near future. Goldman Sachs did not disclose Paulson & Co.'s short position or its role in the collateral selection process in the term sheet, flip book, offering memorandum, or other marketing materials provided to investors.

by Calculated Risk on 4/16/2010 10:05:00 AM

From the BLS: Regional and State Employment and Unemployment Summary

Regional and state unemployment rates were little changed in March. Twenty-four states recorded over-the-month unemployment rate increases, 17 states and the District of Columbia registered rate decreases, and 9 states had no rate change, the U.S. Bureau of Labor Statistics reported today. Forty-four states and the District of Columbia recorded jobless rate increases from a year earlier, 5 states had decreases, and 1 state had no change.
...
Michigan again recorded the highest unemployment rate among the states, 14.1 percent in March. The states with the next highest rates were Nevada, 13.4 percent; California and Rhode Island, 12.6 percent each; Florida, 12.3 percent; and South Carolina, 12.2 percent. North Dakota continued to register the lowest jobless rate, 4.0 percent in March, followed by South Dakota and Nebraska, 4.8 and 5.0 percent, respectively. The rates in California, Florida, and Nevada set new series highs, as did the rate in Georgia (10.6 percent).
emphasis added

Click on graph for larger image in new window.

This graph shows the high and low unemployment rates for each state (and D.C.) since 1976. The red bar is the current unemployment rate (sorted by the current unemployment rate).

Fifteen states and D.C. now have double digit unemployment rates. New Jersey and Indiana are close.

Four states and set new series record highs: California, Florida, Nevada and Georgia.

by Calculated Risk on 4/16/2010 08:30:00 AM

Click on graph for larger image in new window.

Total housing starts were at 626 thousand (SAAR) in March, up 1.6% from the revised February rate, and up 30% from the all time record low in April 2009 of 479 thousand (the lowest level since the Census Bureau began tracking housing starts in 1959).

Single-family starts were at 531 thousand (SAAR) in March, down 0.9% from the revised February rate, and 49% above the record low in January and February 2009 (357 thousand).

The second graph shows total and single unit starts since 1968. This shows the huge collapse following the housing bubble, and the slow and sluggish recovery in housing starts.

Here is the Census Bureau report on housing Permits, Starts and Completions.

Housing Starts:
Privately-owned housing starts in March were at a seasonally adjusted annual rate of 626,000. This is 1.6 percent (±15.2%)* above the revised February estimate of 616,000 and is 20.2 percent (±15.3%) above the March 2009 rate of 521,000.

Single-family housing starts in March were at a rate of 531,000; this is 0.9 percent (±12.1%)* below the revised February figure of 536,000. The March rate for units in buildings with five units or more was 88,000.

Housing Completions:
Privately-owned housing completions in March were at a seasonally adjusted annual rate of 656,000. This is 3.1 percent (±16.7%)* below the revised February estimate of 677,000 and is 21.2 percent (±8.9%) below the March 2009 rate of 833,000.

Single-family housing completions in March were at a rate of 486,000; this is 5.9 percent (±14.6%)* above the revised February rate of 459,000. The March rate for units in buildings with five units or more was 161,000.

by Calculated Risk on 4/15/2010 09:49:00 PM

Notes: this data is not seasonally adjusted. There is a very distinct seasonal pattern for imports, but not for exports. LA area ports handle about 40% of the nation's container port traffic.

Sometimes port traffic gives us an early hint of changes in the trade deficit. The following graph shows the loaded inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container). Although containers tell us nothing about value, container traffic does give us an idea of the volume of goods being exported and imported.

Click on graph for larger image in new window.

Loaded inbound traffic was up 2.6% compared to March 2009. (up 9.6% compared to last year using three month average). Inbound traffic was still down 9.2% vs. two years ago (Mar08).

Loaded outbound traffic was up 13.6% from March 2009. (+24.9% using three months average) Just as with imports, exports are still off from 2 years ago (off 8.0%).

Looking at the graph (red line), exports recovered in the first half of 2009, but then export traffic only increased gradually since last summer. Export traffic picked up again in March.

It is harder to tell about imports (blue line) because of the large seasonal swings. Usually there is a large dip in either February or March - depending on the timing of the Chinese New Year - and that didn't happen this year. The lack of a large seasonal dip might suggest a significant increase in imports too.

by Calculated Risk on 4/15/2010 06:30:00 PM

From Jim Puzzanghera at the LA Times: Regulators did little to halt reckless practices at WaMu

Federal banking examiners found serious problems at Washington Mutual Bank at least five years before its 2008 collapse, but their supervisors showed little concern ... During those five years, examiners constantly warned of "less than satisfactory" loan underwriting, the "horrible performance" of its subprime-backed mortgage securities and the failure of WaMu executives and federal regulatory supervisors to do much about it.

One examiner said he was derided by colleagues as "the housing 'bubble' boy" for his "gloom and doom" predictions for some risky loans, and another complained that critics of subprime loans were called "chicken little."
...
Former OTS Director John Reich, who served from 2005 to 2009, referred to WaMu Chief Executive Kerry Killinger as "my largest constituent" in a 2007 e-mail.

That attitude pervaded the upper levels of the agency ...

Once again the field examiners did their job, but their efforts were ridiculed. I was asked by a reporter a couple of years ago who was to blame for the housing bubble, and I said the list is long, but it starts with the regulators ...

This photo from 2003 shows two regulators: John Reich (then Vice Chairman of the FDIC and later at the OTS) and James Gilleran of the Office of Thrift Supervision (with the chainsaw) and representatives of three banker trade associations: James McLaughlin of the American Bankers Association, Harry Doherty of America's Community Bankers, and Ken Guenther of the Independent Community Bankers of America.

by Calculated Risk on 4/15/2010 03:55:00 PM

A few links ...

Click on graph for larger image in new window.

This graph is from Doug Short of dshort.com (financial planner): "Four Bad Bears".

Note that the Great Depression crash is based on the DOW; the three others are for the S&P 500.

Henry Blodget at Business Insider has an update of the cyclically adjusted PE ratio (CAPE). (ht Mark)

Measured using our favorite valuation technique, Professor Shiller's cyclically adjusted PE analysis, the S&P 500 has a PE of 22X. The long-term average (1880-2010) is about 16X. The current level is actually close to the big bull market peaks of the past--with the exception of the gigantic one that peaked in 2000.

From the Financial Times: Greece takes key step towards rescue

Greece capitulated ... took an important step towards a bail-out from its eurozone partners and the International Monetary Fund as it formally sought “consultations” over a €30bn-plus ($40bn, £26bn) loan package to stave off default.

... Greece’s finance minister, George Papaconstantinou, said Athens wanted to discuss “a multi-year economic policy programme with the Commission, the European Central Bank and the International Monetary Fund”.
excerpt with permission

On Industrial Production from Spencer at Angry Bear (see graph):

Historically, recoveries have been proportional to the recessions -- severe recessions have strong recoveries and mild recessions have weak recoveries. So far the recovery in industrial production this cycle looks about average. But given the depth and severity of the recessions an average rebound is disappointing.

And Professor Hamilton has More on oil prices and the economic recovery

by Calculated Risk on 4/15/2010 01:00:00 PM

The increase this month was driven by traffic of prospective buyers and current sales - and this was the last month that buyers can take advantage of the housing tax credit - so this increase was no surprise.

Note: any number under 50 indicates that more builders view sales conditions as poor than good.

Click on graph for larger image in new window.

This graph shows the builder confidence index from the National Association of Home Builders (NAHB).

The housing market index (HMI) was at 19 in April. This is an increase from 15 in March.

The record low was 8 set in January 2009. This is very low - and this is what I've expected - a long period of builder depression. The HMI has been in the 15 to 19 range since May 2009.

This second graph compares the NAHB HMI (left scale) with single family housing starts (right scale). This includes the April release for the HMI and the February data for starts (March starts will be released tomorrow).

This shows that the HMI and single family starts mostly move generally in the same direction - although there is plenty of noise month-to-month.

And right now they are moving sideways - at best.

Press release from the NAHB: (TBA)

by Calculated Risk on 4/15/2010 12:06:00 PM

From HotelNewsNow.com: STR: Upscale segment tops occ. increases

Overall the industry’s occupancy increased 12.6 percent to 59.2 percent; ADR ended the week virtually flat with a 0.4-percent decrease to US$96.31; and RevPAR was up 12.1 percent to US$57.00.

“We saw strong RevPAR growth this week because of a favorable Easter comparison,” said Chad Church, industry research manager at STR.

The following graph shows the occupancy rate by week and the 52 week rolling average since 2000.

Click on graph for larger image in new window.

Notes: the scale doesn't start at zero to better show the change.

The graph shows the distinct seasonal pattern for the occupancy rate; higher in the summer because of leisure/vacation travel, and lower on certain holidays.

The occupancy rate was boosted by the Easter holiday, and even still the occupancy rate was below the average for this week of around 63% (usually without Easter). The 52 week average is moving up - and that is a good sign for hotels.

Data Source: Smith Travel Research, Courtesy of HotelNewsNow.com

by Calculated Risk on 4/15/2010 09:39:00 AM

From the Fed: Industrial production and Capacity Utilization

Industrial production edged up 0.1 percent in March and increased at an annual rate of 7.8 percent in the first quarter. Manufacturing output rose 0.9 percent in March, led by widespread gains among durable goods industries. Factory production was likely held down in February by the winter storms but nonetheless rose at an annual rate of 6.6 percent for the first quarter as a whole. The output of mines increased 2.3 percent in March. Utilities output dropped 6.4 percent; after a relatively cold February, demand for heating fell in March as temperatures climbed to above-normal levels. At 101.6 percent of its 2002 average, industrial output in March was 4.0 percent above its year-earlier level. Capacity utilization for total industry advanced 0.2 percentage point to 73.2 percent, a rate 7.4 percentage points below its average from 1972 to 2009, but 3.7 percentage points above the rate from a year earlier.

Click on graph for larger image in new window.

This graph shows Capacity Utilization. This series is up 7.2% from the record low set in June 2009 (the series starts in 1967).

Capacity utilization at 73.2% is still far below normal - and 9.1% below the the pre-recession levels of 80.5% in November 2007.

Note: y-axis doesn't start at zero to better show the change.

Also - this is the highest level for industrial production since Dec 2008, but production is still 9.6% below the pre-recession levels at the end of 2007.