Shorter Beige Book:
"The Federal Reserve said economic
activity increased "at a slower pace” in late November and
December, with districts reporting "disappointing” holiday
sales.
"Economic activity increased modestly during the survey
period,” though "at a slower pace,” the central bank said in
its regional business survey, known as the Beige Book for the
color of its cover. "Most reports on retail activity indicated
subdued holiday spending and further weakness in auto sales.”The report provided anecdotal evidence the economy is
slowing, a day before Fed Chairman Ben S. Bernanke is scheduled
to testify on the outlook at Congress. Bernanke said last week
more rate cuts "may well be necessary” after 1 percentage
point of reductions since September to buttress growth."
Of course, the Fed would have known this had they been here at The Big Picture as often as some of their staff.
>
Sources:
Summary of Commentary on Current Economic Conditions by Federal Reserve District
Federal Reserve Bank of Atlanta, January 16, 2008
http://www.federalreserve.gov/fomc/beigebook/2008/20080116/default.htm
Fed Says Economy Slowed at Year-End, With Sales `Disappointing’
Steve Matthews
Bloomberg, Jan. 16 2007
http://www.bloomberg.com/apps/news?pid=20601087&sid=aJ3n7g1Qv.U8&
Here is the first mainstream news article I have seen that mentions possible depression.
http://biz.yahoo.com/ap/080116/bank_earns.html?.v=3
Donald Trump just hinted at a depression too on CNBC.
I still think we are at a bottom. Stocks may, and probably will, go away in May. But between now and then, the story about retail sales is old news.
But, but I thought the economy was strong and growing as of a couple weeks ago.
With continued bad retail due to high fuel costs over the winter, it will remain news.
The losses at Citi et al. bring historic comparisons to the bank losses of “the” Depression.
You always think you are at bottom until, lo and behold- you hit a new bottom.
And we haven’t hit the Credit Default Swap skids yet.
Bought some furniture 6 weeks ago. Got a letter yesterday that the company is BK and I’m now a creditor. Called the credit card company and they reversed the charge thankfully. Takeaways: Be careful where you shop. Don’t pay full balance until product is delivered. Pay on credit card. Man these credit card companies will be taking massive losses.
credit default stuff is totally over-rated by conspiracy theorists. don’t get fooled by the huge increase in notional amounts outstanding, the vast bulk is offset amongst the dealers.
A buys $1bn CDX from B
B buys $1bn CDX from C
C buys $1bn CDX from A
give or take, this is what happens every day but on a much bigger scale. however, that is now counted as $3bn outstanding, even though the risks are all offset.
so take the $45trillion number you hear bandied about with a pinch of salt.
Of course, the Fed would have known this had they been here at The Big Picture as often as some of their staff.
Do you have enough time on your hands to check IP addresses/domains in your logs? ;-)
Per Carter Worth and other chartists, none of this makes any difference. It’s all in the curves, support levels, etc.
Logic tells me that’s a bunch of crap and voodoo, but my cratering portfolio tells me logic is for suckers.
Do fundamentals, macro econ, stimuli and so on even matter?
Can you say half point cut in the FF rate in January and another impromptu cut of another half point in Feb? Sure you can.
Oh well, ..if Donald says we are going to have a depression, then we must have one.
C’mon BR, does the money honey and Krudlow really believe the bullshit they spew? You would know? Are they really that stupid? I know Ben knows whats going on. I think he thinks most Americans are stupid and don’t have any idea what’s going on so they act like they are dealing with little kids. He is a genius don’t you know. Right up there with actors and CNBC anchors.
They know what they are going to do. Spoon feed us along the way while we have to listen to idiots on CNBC pump and dump the noise.
Sorry, but we will go to war way before we go into a depression giving all those idiot mortgage brokers and realtors a M16 and boots. John and Julie BANG BANG!
Johnny..
i wont be surprised if we get a .75 pt cut.
and for that matter, it maybe well before jan 30.
50 pt is almost a given thing right now, anything less than that will mean too much beef on wall street, created by the bears..
I will buy stocks hand over fist when Kudlow capitulates.
Dennis Kneale is the biggest know-nothing on CNBC. He just said that inflation is still at historically low levels and is not a problem. To prove his point, he says the inflation adjusted high for gold would be $2100 an ounce. Didn’t that just prove inflation is a massive problem?
Read it here second,The FED says ” get yourself a shovel, we are in deep sh#t!!”
Falling consumer spending, OOHHH the Humanity!
What about post-holiday sales? I loaded up on stuff at 90% off! Lights, decorations, etc. Two shopping carts full!
B – you’re starting to sound a little like my friend, Dr. Peter Morici.
FYI, did you catch his Canadian interview?
From Peter:
“I gave this interview on Canada’s Business News Network. It is the analog to our cable finanical networks.
http://broadband.bnn.ca/?vid=26562
If I disappear, look for me under Grant’s tomb.”
It’s not valid to compare $850 gold in 1980 to $2100 now. Gold hit that high intraday and in fact was only above $700 for 6 days back then. It was just a one hour spike to that high. The avg for that month was in the $600s. Still, Gold should be about $1,500. One of the benefits of killing the messenger is to later claim, see there’s no inflation. Anybody buying treasuries right now is getting a negative real rate of return. Nuts.