Long Term Perspective
Income and interest rates are the two key factors that affect housing activity. More housing construction translates into increased demand for furniture and appliances as consumers refurnish their new homes. The rate of housing construction peaked in the first quarter of 1999, but held up well in 2000 and 2001 and accelerated in the first half of 2002.

Short Term Perspective
Housing starts fell back in October after surging in September. Mortgage rates continued to decline through November. The housing market could remain hot for a few more months given current mortgage rate levels, but don't expect levels like the September surprise.

Real GDP vs. Final Sales   •   Real Consumer Spending vs. Real Income   •   Debt Burden vs. Savings Rate

Business Fixed Investment vs. Net Cash Flow   •   New Orders   •   Housing Starts vs. Mortgage Rates

Merchandise Exports vs. Trade Weighted Dollar   •   Merchandise Imports vs. Trade Weighted Dollar