I am sorry Dean Baker, it pained me to write that. But, seriously why be such a so-and-so all the time. Especially when you got this so wrong.

It is easy to show that the main factors keeping demand depressed are the sharp falloff in construction due to the overbuilding from the bubbles in residential and non-residential construction and the large trade deficit. The trade deficit was offset in the bubble years by bubble-driven consumption and construction, but it is ridiculous to envision the U.S. economy returning to this growth path.

The Post should try to find some economists with a better understanding of the economy as sources for its news articles.

So here is the total construction series from FRED.

Here are growth rates

FRED Graph

I can see a burst alright but that doesn’t look like much of a bubble.

Here are log-levels


Does that overbuilding look commensurate with the bust?