October 20th, 2011
Econintersect: The consolidated economic report from the 12 Federal Reserve Districts (Biege Book) says economic activity "continued to expand". For the December 2007 recession, here is the lead up summary words from the Beige Books:
- 28Nov2007 - "expanding"
- 16Jan2008 - "increasing moderately"
- 05Mar2008 - "growth slowed"
- 16Apr2008 - "weakened"
For the March 2001 recession which ended in November 2001, here are the Beige Book summary words:
- 17Jan2001 - "economic growth slowed"
- 07Mar2001 - "sluggish to modest economic growth"
- 02May2001 - "slow pace of economic activity"
- 13Jun2001 - "little changed or decelerating"
- 08Aug2001 - "slow growth or lateral movement"
- 19Sep2001 - "sluggish"
- 24Oct2001 - "weak economic activity"
- 28Nov2001 - "remained soft"
- 16Jan2002 - "remained weak"
So the question is what is what the code words "continued to expand" mean? It appears clues are difficult to spot using the Beige Book. The summary for the 19 October 2011 release reads as follows:
Reports from the twelve Federal Reserve Districts indicate that overall economic activity continued to expand in September, although many Districts described the pace of growth as “modest” or “slight” and contacts generally noted weaker or less certain outlooks for business conditions. The reports suggest that consumer spending was up slightly in most Districts, with auto sales and tourism leading the way in several of them. Business spending increased somewhat, particularly for construction and mining equipment and auto dealer inventories, but many Districts noted restraint in hiring and capital spending plans. By sector, manufacturing and transportation activity was reported to have increased on balance. A few Districts also reported slight improvements in construction and real estate activity; nonetheless, overall conditions for both residential and commercial real estate remained weak. Districts reporting on nonfinancial services cited mixed results with activity varying widely by industry. Loan demand by and large moved lower, with the exception of an increase in mortgage refinancing in many Districts. Crop conditions at harvest were generally less favorable than a year ago. In contrast, energy and mining activity continued to strengthen in several Districts, with the exception of some storm-related slowdowns in the Gulf of Mexico. Cost pressures eased in the majority of Districts, though there was some further pass-through of earlier increases to downstream prices. Wage pressures remained subdued outside of a few exceptions in which firms noted having difficulty finding appropriately skilled workers.
Source: Federal Reserve