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Fed survey: Modest economic expansion continues

By Neil Irwin

The economy continued expanding, though at a modest rate, in recent weeks, according to a new Federal Reserve survey. It shows that though the pace of growth downshifted over the summer, the growth rate appears to have leveled off.

The Fed's "beige book," a compilation of anecdotal reports from businesses around the country released Wednesday afternoon, says that "national economic activity continued to rise, albeit at a modest pace" from September through early October. That's a contrast to the previous beige book, in early September, which reported "widespread signs of deceleration compared with previous periods."

The latest report has particular relevance as the Fed prepares for a Nov. 2-3 policy meeting at which it appears likely to approve unconventional new efforts to stimulate growth. The beige book is prepared to help the policymakers make their decisions at those meetings, and the absence of any sign that the economic growth is picking up after its summer lull gives the central bankers a greenlight to consider new steps to try to encourage growth.

The details of the report are a hodgepodge of results from different industries and parts of the country, ranging from moderately positive to moderately negative. It is evidence of a nation that is neither sinking back into economic contraction nor bursting into a robust expansion.

"Manufacturing activity continued to expand" across most of the country, with particular signs of strength in the export sector, semiconductors and high-tech equipment, and automobile production, the report said. But, it said, "hiring at manufacturing firms remained sluggish."

In the service industry, "accounting activity improved slightly, spurred by merger and acquisitions work," the Boston and Dallas Federal Reserve banks "noted increases in consulting activity," and "there were some reports from architectural firms that activity had picked up." Demand for transportation services appeared to have slowed, however.

Retail spending was "flat to moderately positive" in most of the country, with declining sales in the southeast United States.

The housing market remained weak, as did bank lending, according to the beige book.

By Neil Irwin  | October 20, 2010; 2:02 PM ET
Categories:  Federal Reserve, U.S. Economy  
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Comments

The Federal Reserve must be living in another universe.

Production grows new wealth, which in turn grows new jobs. It's real simple, so why can't these "genesis" at the Fed understand that fact of high school economics. They still talk about have a jobless recovery.

Until we start producing goods, once more, there will be no recovery for the Middle Class .......... Wall Street does NOT produce new wealth, it just recycles it and only grows jobs for itself.

No matter the greed involved; once the Middle Class disappears, so will this country.

Posted by: bkarpus | October 20, 2010 3:34 PM | Report abuse

Where does the Post get off publishing this nonsense? Don't you think we can read? Unemployment is RISING, right along with inflation, the trade deficit, job outsourcing. Multinational corporations and investors have al of their money in Asia, creating jobs and factories there, and furtheer undermining this country. The Financial Times of London and just about every foreign newspaper expects the US ecobnomy to flat out collapse.... And you, silly fools, can only echo the empty nonsense coming out of Washington that the "recovery" is upon us? Whatever happened to a free and independent press?

Posted by: Anonymous | October 20, 2010 3:56 PM | Report abuse

I suppose that one of the great puzzlements of our time is why on earth those who brought about the crash are NOT paying the cost up to and including jail time for many.

Included here are Wall Streeters who profited greatly and, in fact, were mostly responsible for the mess that we are in, bankers across the country large and small, housing developers, real estate agents and even in some instances landowners.

And, of course, there is the Bush Administration which, with its Republican Party majorities, actually facilitated the wrongdoing by lax regulation and lax enforcement of regulations.

(And Republicans haven't learned a thing from the Great Recession that they helped bring about. Just today I heard a Republican candidate for Congress from South Carolina extoll an "ownership society" -- shorthand for piling on debt from those who reasonably cannot afford it -- and who the vultures know cannot afford it but don't care -- caring only for the short term-profit they'll make devil take the hindmost.)

As for the mainstream media, especially the cablevision news channels including Bloomberg, sad to say, it blatantly is featuring interviews and advice almost daily from some of the very folks as above who brought this calamity down on us. It's "Who, me"?)

Has America learned its lesson this time around?

If not, what does it take?

Go figure.

Posted by: ram9478 | October 20, 2010 4:13 PM | Report abuse

I suppose that one of the great puzzlements of our time is why on earth those who brought about the crash are NOT paying the cost up to and including jail time for many.

Included here are Wall Streeters who profited greatly and, in fact, were mostly responsible for the mess that we are in, bankers across the country large and small, housing developers, real estate agents and even in some instances landowners.

And, of course, there is the Bush Administration which, with its Republican Party majorities, actually facilitated the wrongdoing by lax regulation and lax enforcement of regulations.

(And Republicans haven't learned a thing from the Great Recession that they helped bring about. Just today I heard a Republican candidate for Congress from South Carolina extoll an "ownership society" -- shorthand for piling on debt from those who reasonably cannot afford it -- and who the vultures know cannot afford it but don't care -- caring only for the short term-profit they'll make devil take the hindmost.)

As for the mainstream media, especially the cablevision news channels including Bloomberg, sad to say, are blantantly featuring interviews and advice almost daily from some of the very folks as above who brought this calamity down on us. It's "Who, me"?)

Has America learned its lesson this time around?

If not, what does it take?

Go figure.

Posted by: ram9478 | October 20, 2010 4:16 PM | Report abuse

Anonymous wrote: "Where does the Post get off publishing this nonsense? Don't you think we can read? Unemployment is RISING, right along with inflation, the trade deficit, job outsourcing. Multinational corporations and investors have al of their money in Asia, creating jobs and factories there, and furtheer undermining this country. The Financial Times of London and just about every foreign newspaper expects the US ecobnomy to flat out collapse.... And you, silly fools, can only echo the empty nonsense coming out of Washington that the "recovery" is upon us? Whatever happened to a free and independent press?"

That's got to be one of the more ignorant posts I've read in a while. Inflation rising? Show me! Inflation is near ZERO! Where in long-term interest rates do you see fears of A. inflation, or B. International concerns that our economy is going to "collapse". If either were the case, we wouldn't be experiencing record low long-term interest rates. The article is relating the economic numbers as they exist and SO SORRY if they conflict with your individual and non-educated perception. Get a life and learn some friggin economics before posting your B.S., Numbnuts.

Posted by: Anonymous | October 20, 2010 5:20 PM | Report abuse

"Anonymous | October 20, 2010 5:20 PM" - Either you are an ignorant moron who doesn't read or you are purposefully without a clue; probably both. The Financial ims of London is reporting that our inflation rate is presently at least 8% and rising! (it' hard to determine becasue the goernment plays games with the numbers. If you look at the raw CPI indexes, food prices increased by 500% between August and September (0.3 to 1.4 raw indices) and by more than 1000% since July. Energy costs increasedby more than 300% and are due for further increases. Virtually every category doubled except for housing.... and I'm just sure you noticed a 20% decrease in your home mortage or rent... or not. India and China is seeing 12% inflation right now and we merely lag them. Couple that with the "all new" Fed policy of stoking infaltion and you can expect to see runaway inflation, rates that will make you pine away for the Carter years and 20% inflation, before next summer.

As for our economy collapsing, it is, just in slow motion. The lunatic economic policies of this Administration coupled with the predatory behavior of Wall Street are ripping this country to shreds. Unfortunately, we passed a point of no return around a year ago and a deprsssion is no longer avoidable.

Posted by: Anonymous | October 20, 2010 6:29 PM | Report abuse

Home foreclosures here in Hampton Roads is up another astonishing 33% in the last month, the last of our major private sector employers International Paper has joined the Ford Truck plant and is now off-shore, unemployment if those who have lost benefits or such as the self employed contractors are counted would be above 18% conservatively, inflation if food and energy are counted which they should be is above 10%...and I could go on and mention other economic indicators here that are worsening such as real estate values home and now commercial continue to fall alarmingly now...so where is the economic turn arround...more propaganda from Washington and Wall Street vermin and filth...the economic turnaround must be Wall Street and it's off-shore investments because it certainly is not happening anywhere on Main Street USA.
I have some advice for the vermin and filth Republicans who helped Wall Street loot and scam the economy as well as off-shore and out-source industries and jobs...I hope you all are returned to power with your failed agenda and philosophy because you all need to take responsibility for your treason, thefts, incompetence and worse...when the economy worsens as it will while you all continue to enrich yourselves as you all will then maybe citziens will finally hold you all accountable and do something about you all...horrific and violent which traitors vermin and filth like you all deserve...I dislike the Democratic career politcians even more...why...because they are exactly like you.

Posted by: Anonymous | October 20, 2010 6:38 PM | Report abuse

There is such a thing as a jobless recovery as long as the companies whose profits are going up are not using that money to hire people. This is what is going on right now -- corporate profits are up, but they are not creating jobs. It's just the rich getting richer.

Posted by: Anonymous | October 20, 2010 9:37 PM | Report abuse

What started this recession? In my opinion, this recession began with very loose policies of lending money to those who could not afford it in the long term. Now who would I blame? The bankers or the borrowers? I would say that it is both. Consumers are as much to blame for their greed as are the "big and rich."
Now, consumers are beginning to hoard their money and pay off their debt instead of borrowing more. Would I blame them and ask them to go start spending money so that we can get out of this mess? No I wouldn't. Why? This is a whole new thing for an economy that was driven by borrowing. The U.S. can either go back to the old way of doing things (borrowing), in that case the economy will pick up quickly again, or the people can change by saving and living within their means. I believe that we blame others for why we buy and spend our money and we do not learn to be responsible for ourselves. In this case the economy is going to lag for some time, until people start spending again after they save up money and pay debt.

Posted by: Anonymous | October 21, 2010 5:40 PM | Report abuse

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