The Federal Reserve Board put out a report today – the so-called Beige Book, and I don’t know a better way to keep people from reading your information than to name it Beige – that offered a glimmer of hope with regard to our shredded economy.
It starts: “reports from the twelve Federal Reserve District Banks indicate that economic conditions remained weak or deteriorated further during the period from mid-April through May.” OK, that doesn’t sound so great. But it then goes on to say: “Five of the Districts noted that the downward trend is showing signs of moderating. Further, contacts from several Districts said that their expectations had improved, though they do not see a substantial increase in economic activity through the end of the year.”
That all jives with what I keep hearing: it probably won’t get that much better this year, because budgets are set and there’s no major event – election, Olympics – coming along that will change anything. However, it shouldn’t get any worse – largely because everything deemed too big to fail – GM, AIG, Bear Stearns, Lehman Bros., Fannie Mae – already has, for the most part.
Still, manufacturing, retail spending, new car purchases, travel and tourism all remain in decline. Home sales, however, seem to be on the rise, which makes sense because you haven’t been able to buy a home this inexpensively and for a lower interest rate in decades — if you can get financing.
In general, when I say the report offers a glimmer of hope, I’m being pretty literal about it. It’s not saying bust out your credit cards and let the good times roll, but it does seem like the unending stream of bad economic news is finally abating a little.
Hear that advertisers?