The Federal Reserve’s Beige Book is noting improvements in most local economies, although as you might expect there is the normal pause or caution still underlying the combined reports. The overall economy was still described as weak but with slowing declines as five of twelve districts showed moderating declines.
There is also the notion of improvement in expectations, but the underlying theme is for no great expectations of a boost this year. The decline in manufacturing was present, but the outlook is better than in the prior report. The survey noted continued softness in retail spending but an uptick in home sales and construction. Also seen was a weakness in lending that was stable as credit conditions remain tight. On the labor front, the jobs market was still noted as weak with flat or falling wages. Also noted was the notion of flat prices, or still falling in some instances.
Feel free to read the full report here. We are curious about one thing here: do those who participate in the survey only look at economic reports that are based on one to three-month old data, or do they actually go out take a look at what is happening in the real world? Our bet is the former rather than the latter.
Jon C. Ogg
June 10, 2009
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