First, the ISM Manufacturing Index reaching the top end of its long term range. "The PMI was at 59.0% in October, up from 56.6% in September. The employment index was at 55.5%, up from 54.6% in September, and the new orders index was at 65.8%, up from 60.0%."
Then, Construction Spending. "On a year-over-year basis, private residential construction spending is now up 1%. Non-residential spending is up 6% year-over-year. Public spending is up 2% year-over-year." And growth trends look terrible.
1) Industrial output growth at cyclical peaks in spite of extremely low corporate leverage and high risk premiums.
2) Private construction spending growth rapidly falling while institutional buyers decline, home owners continue to deleverage, and banks hold real estate assets below the levels of 7 years ago.
3) Monetary and regulatory policies aimed at thwarting financial instability.