Here's a tale of two construction sectors. First, we all know housing sucks:
Non-residential construction, though, is booming.
Now for a lesson: look carefully at the scales. (You should be doing this every time you see a chart, or else the chartist may be putting one over on you.) Residential construction runs roughly twice as large as non-residential, so the great surge of non-res just offset the decline in res.
Finally on this topic, Barry Ritholtz (The Big Picture) summarizes the pessimistic case for the housing industry, echoing my earlier post about the huge housing inventory. Take a look especially at his chart showing the time table for adjustable rate mortgage resets. It indicates a lot worse to come.