Fed's Beige Book: The economy stinks
No surprise here -- the Federal Reserve's latest "Beige Book" report on the economy says things stink. Tourism stinks. Retail stinks. Manufacturing stinks. Housing stinks. Commercial real estate stinks. Agriculture, mining, and energy are starting to stink. Oh and the job market stinks.
The "Fedspeak" version of my summary can be found below ...
"Overall economic activity weakened across all Federal Reserve Districts since the last report. Districts generally reported decreases in retail sales, and vehicle sales were down significantly in most Districts. Tourism spending was subdued in a number of Districts. Reports on the service sector were generally negative. Manufacturing activity declined in most Districts, and new orders were soft. Nearly all Districts reported weak housing markets characterized by reduced selling prices and low, but stable, sales activity. Commercial real estate markets declined in most Districts. Lending contracted, with many Districts reporting reductions in residential, commercial and industrial lending and tightening lending standards. Agricultural conditions were mixed with a relatively good harvest but concerns about profitability. Mining and energy production and exploration started to soften due to lower output prices.
"District reports generally described labor market conditions as weakening. Wage pressures were largely subdued. District reports characterized price pressures as easing in light of some decreases in retail prices and declines in input prices, particularly energy, fuel, and many raw materials and food products."
The "Fedspeak" version of my summary can be found below ...
"Overall economic activity weakened across all Federal Reserve Districts since the last report. Districts generally reported decreases in retail sales, and vehicle sales were down significantly in most Districts. Tourism spending was subdued in a number of Districts. Reports on the service sector were generally negative. Manufacturing activity declined in most Districts, and new orders were soft. Nearly all Districts reported weak housing markets characterized by reduced selling prices and low, but stable, sales activity. Commercial real estate markets declined in most Districts. Lending contracted, with many Districts reporting reductions in residential, commercial and industrial lending and tightening lending standards. Agricultural conditions were mixed with a relatively good harvest but concerns about profitability. Mining and energy production and exploration started to soften due to lower output prices.
"District reports generally described labor market conditions as weakening. Wage pressures were largely subdued. District reports characterized price pressures as easing in light of some decreases in retail prices and declines in input prices, particularly energy, fuel, and many raw materials and food products."
posted by Mike Larson at
2:02 PM
2 Comments:
It is almost certain an interest cut will occur, the only question is whether it will be a 50 basis point (half a percent) or 100 basis point (1%) cut. My opinion is that the Fed will go for the steeper rate cut given things look to have gotten worse and neither financial markets nor consumer spending has stabilized. With inflation no longer a real threat, the Fed can afford to be ultra-aggressive
By
Anonymous, at December 3, 2008 at 8:13 PM
The new interest cuts i think are pointless and bringing this country into a worse state, nice blog
By
Anonymous, at December 4, 2008 at 2:09 PM
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