The Beige Book has been of more interest to investors of late because everyone is looking for the breaking point that will either send the U.S. into a new recession or (better yet) will keep the U.S. from falling back into recession.
Today’s Beige Book was pepared by the Federal Reserve Bank of Minneapolis, but we would stress that the data is based on information collected before November 18, 2011. This means that the Black Friday weekend sales data was not a part.
The report noted that economic activity increased at a slow to moderate pace since the previous report in all Fed districts except for St. Louis. The overall tone is sounding just a tad more positive or a tad less negative than the prior report.
Business services was flat to higher, manufacturing activity expanded at a steady pace across most of the country, and this may sound like a surprise but the Fed reported that overall bank lending rose slightly since the previous report. Another note was that home refinancing grew at a more rapid pace, while credit standards and credit quality varied.
Residential real estate remained sluggish, and commercial real estate was called “lackluster across most of the nation.” Single family home construction was called weak while commercial construction was slow. Other notes were favorable agricultural conditions, and energy and mining activity was higher.
Wages and salaries were stable. No real help on the labor front just yet as hiring was called “generally subdued.” There is one key note confirming much of the “lies about applicants” or the “abilities of applicants” because the Fed noted “some firms with open positions reported difficulty finding qualified applicants.” Overall price increases remained subdued, and some cost pressures were reported to have eased.
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