The September 8, 2010 Beige Book release came from the Federal Reserve Bank of San Francisco, and the data is based on information collected on or before August 30, 2010. In short, much of the data is already known. The twelve Federal Reserve Districts are trying to suggest that there is continued growth in national economic activity from the period of mid-July through the end of August. No matter how you cut it, this is still decelerating growth that does not really feel like any growth. The good news is that the more fresh economic indicators that we have seen seem to keep us out of a real double dip recession scenario for now.
The quotes are hard to ignore: “…but with widespread signs of a deceleration compared with preceding periods.”
Economic growth at a modest pace was the most common characterization provided by the five western Districts of St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco. Boston and Cleveland also pointed to positive developments or net improvements compared with the previous reporting period.
However, the districts of New York, Philadelphia, Richmond, Atlanta, and Chicago all highlighted mixed conditions or deceleration in overall economic activity.
Some of the key takeaways were that price and wage pressures remain limited. There is also a widespread notion of weak loan demand despite credit quality improving a bit. As far as the weak housing data, the Beige book highlighted that the home sales and construction were hit by the end of the tax credits.
The interesting aspect in general is that the Beige Book is talking about US consumer spending appearing to be on the rise. Also noted was that the US economic growth shows that there are widespread signs of slowing.
The rest of the full BEIGE BOOK can be found here.
JON C. OGG
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