We know that residential building is correcting sharply from hug peaks now. Not so obvious to the naked eye is non-residential contruction which is also looking awful shaky, via UBS:
Non-residential approvals slumped 33.7% y/y to the lowest level since Jan-17 Elsewhere, the value of (volatile) non-residential building approvals fell again (-3.8% m/m, after -24.7%), slumping 33.7% y/y, the worst since 2014. While the data is very volatile, Sep-18 was the lowest level since Jan-17, and the trend is deteriorating.
This is a big component of business investment and it is also a screaming bubble:
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
