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Mortgage lending headlines today were ripe with doom and gloom, including a newsletter from “Inside Mortgage Finance” alerting readers of a 14-year low in mortgage originations and a 58% decrease in mortgage lending in the first quarter of 2014 compared with the first quarter of 2013.

Read the small print, however, and you will learn that this waning is mostly due to the decline in refinancing from last year, when 30-year rates were hovering around 3.5%, compared with 4.5% today. New mortgage originations were flat compared with the prior year.

On the more optimistic side this month is the industrial production report from March (which was published on April 17th), including the following examples:

  • March industrial production is up 3.8% compared with prior year; this is on top of an increase of 3.5% for March 2013 over 2012
  • Every major product and industry category showed year-over-year growth except paper, textiles, and food/tobacco, indicating broadly distributed growth
  • Revision upward for the February industrial production numbers from 0.6 to 1.2
  • Industrial capacity increased 2.2% over prior year and capacity utilization stood just below the 40-year average at 79.2%

Corroborating this data is a 3.1% increase in U.S. rail traffic in the first quarter 2014 compared with the prior year.

From our vantage point, the data on production and rail traffic trump the housing data, so get out of the house and get on the growth train!

See full newsletter here.

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