Beige Book. I just asked my broker and he sent me this collection of stuff.
ODJ REPEAT:Fed/Beige Book:Mad Cow Scare Cited By 7 Of 12 Districts
By Deborah Lagomarsino and Rebecca Christie
Of DOW JONES NEWSWIRES
WASHINGTON (Dow Jones)-- The U.S. economy continued to pick up steam at the end of last year, while the labor markets also improved, the Federal Reserve said Wednesday in it latest Beige Book report.
"Reports from the Federal Reserve Districts suggest that the nation's economy has continued to improve since the last survey," the Fed said.
"The strongest report came from the San Francisco district, which said its economy expanded soundly. Most other districts also gave quite favorable reports, saying their economies improved, strengthened further, or grew at a
moderate pace," the Fed said.
The Beige Book is a summary of economic activity prepared for use at the central bank's next Federal Open Market Committee meeting Jan. 27-28. The most recent report was prepared by the Federal Reserve Bank of Kansas City and
reflects information gathered before Jan. 6.
Many districts expressed concern about the impact of mad cow disease, which emerged in the U.S. last month. Seven of the 12 regional Fed districts cited the disease as a worry.
"The appearance of mad cow disease created considerable uncertainty in the cattle industry," the Fed said.
"Contacts in several districts noted substantial declines in cattle prices due to foreign bans on U.S. beef exports. The uncertainty was causing ranchers in the Kansas City and Dallas districts to take a wait-and-see approach toward
herd adjustments," the Fed said.
Boston: Economy appears to be improving. Retail activity reportedly picked up at the end of 2003 and travel and tourism were said to be stronger. Manufacturers also said demand for their products was higher than it was a
year earlier. Prices were generally stable or falling, except for some metals, wood products, oil and gas. Housing market still strong, but insurance activity has leveled out. Hiring plans modest, but contacts report no planned
layoffs.
New York: Economy showed further signs of strengthening. Retailers report mixed, but generally positive, sales results for December. Retail staffing levels were little changed, but hiring activity in other areas was
characterized as relatively brisk. Consumer confidence retreated a little in December after a hitting a 12-month high in November. But business contacts said manufacturing activity kept improving as the year came to a close.
Housing markets showed ongoing strength despite winter weather's effects on construction. Bankers report weaker demand for consumer and home mortgage loans, but also lower delinquency rates. Office vacancy rates held steady, while asking rates edged up. Wall Street employment said to be rising, with bonuses up about 20% from last year.
Philadelphia: Business conditions improved in December. Manufacturers reported increases in orders and shipments from November. Holiday retail sales posted solid increases compared with a year earlier. Banks reported modest
lending growth, and investment companies reported ongoing increases in activity. Service industries gave relatively positive reports, although most said their business was expanding only slightly. The 2004 consensus outlook is
for continued improvement, as both manufacturers and retailers expect gains in the coming year.
Cleveland: Economic environment was relatively unchanged in recent months;
slow, steady improvement in business conditions continues. Most manufacturers said production levels were at least steady in November and December. Retailers were disappointed with holiday sales, but noted a pickup as the year ended. Construction industry said things were about the same, as residential builders stayed busy and commercial builders continued to wait for better times. Banks reported mixed loan demand and slower deposit growth. Most firms said they don't plan to raise staffing levels, about the same as in the previous report. But rising input prices seemed more widespread than in previous months.
ODJ REPEAT:Beige Book/Districts -2:Richmond,Atlanta,Chicago,StLouis
Richmond: Economy expanded at moderate rate in November and December, led by signs of a manufacturing rebound. Manufacturers reported solid gains in shipments and new orders. Retailers recorded steady sales through the
holidays, but services firms said their revenues increased only slightly. In real estate markets, residential activity remained upbeat and commercial leasing activity picked up in November and December. Bankers noted somewhat
higher demand for commercial loans, but less demand for consumer mortgages. Tourism was strong, aided by an encouraging start to the ski season.
Atlanta: Pace of economic growth stayed favorable in the last two months of 2003. Job markets firmed a bit, although employers remained cautious. Prices were generally stable. Retailers gave encouraging reports about holiday sales,
and most said that activity met or exceeded year-ago levels. Car sales were mixed; foreign models did better than U.S.-made vehicles. Housing market stayed strong, commercial real estate market stayed weak. Modest improvement
for factories, and some contacts reported an increase in capital spending. Tourism and hospitality industries improved late in the year, and there were upbeat reports from the financial sector.
Chicago: Economic activity continued to improve in November and December. Consumer spending picked up modestly, on average, boosted by a surge in the last days of 2003. Business spending also grew modestly. Construction and real estate activity slowed somewhat. Manufacturing posted broad-based gains. Overall lending activity was relatively flat. Upward retail price pressures were generally subdued, though reports of rising input costs were more frequent. Cattle prices dropped after news of mad cow disease in the U.S., but those prices remained above year-ago levels.
St. Louis: Business conditions mixed at end of 2003. Some manufacturers and services firms reported improved employment and investment conditions; others reported layoffs, plant closings and flat or lower capital spending. Retail and auto sales up from a year ago in November and December. Home sales still up, but commercial real estate markets still weak. Loan demand at smaller banks fell slightly during the fourth calendar quarter. Impact of mad cow disease remains to be determined.
Minneapolis: Economy grew at a healthy pace from mid-November to mid- December. Residential real estate, manufacturing, mining, consumer spending and tourism were up. Commercial real estate was mixed, and the energy and farm sectors were down. Labor markets were stable. Wage and price increases were generally moderate, except for big price increases for heating costs and scrap metal, and significant price decreases for beef after the discovery of mad cow disease.
Kansas City: Economy strengthened further in December, amid general optimism on the economic outlook. Retail sales were quite solid, labor markets firmed slightly, and housing and energy markets stayed strong. Farm sector was
strong, but contacts were somewhat uncertain about future conditions due to the U.S. appearance of mad cow disease. Wage and price increases were generally modest, although some materials prices continued to rise rapidly.
Dallas: Economic activity expanded modestly from mid-November to early January, amid general optimism about 2004. As a result, contacts said they were increasingly taking steps to boost capital spending and hiring.
Manufacturing activity continued to recover, while demand for business services grew modestly. Retailers said holiday sales were good but not great. Conditions mostly unchanged for energy industry, and for real estate and construction firms. Beef industry has been disrupted by fears of mad cow
disease, but other farm conditions were little changed.
San Francisco: Economy expanded soundly in late November and December, a slight improvement from the previous survey period. Consumer and producer prices were generally stable, although respondents noted increases in some energy and materials costs. Wage and salary increases remained modest, but the
growth rate of total compensation edged up. Retailers reported robust consumer holiday spending, with higher sales and less discounting than last year. Factory activity continued to expand, district housing markets remained strong and commercial real estate markets stayed weak. Demand for business loans stayed subdued. Except for cattle ranchers, who were affected by the U.S. discovery of mad cow disease, conditions among farm producers remained solid. Sales of organic and range-raised beef saw some improvement after the appearance of mad cow disease.
The Chicago district noted that cattle prices "fell significantly" on mad cow concerns, but have stayed above year-ago levels. The Dallas district said contacts consider U.S. beef safe, but note that cattlemen may delay
liquidating herds, "reducing beef production in 2004."
The San Francisco district said the mad-cow scare has benefited some organic beef ranchers.
As for the labor markets, the Fed said many districts reported "modest improvements," which took the form of reduced layoffs or modestly increased hiring.
"New hiring was still quite minimal in several districts and most types of workers remained easy to recruit," the Fed said.
Acute labor shortages were generally reported only for select health care fields, the Fed said.
The employment report for December suggested that the labor market is firming, albeit at a modest pace. Nonfarm business payrolls grew by just 1,000 last month, the fifth straight month of job growth, but was far less than the 150,000 increase most economists had expected.
The New York district said Wall Street employment is on the rise, with bonuses expected to be up 18% to 20% from last year.
Holiday retail sales were "generally positive" across the country and auto sales either improved or held steady in most districts, the Fed said.
"All districts reporting on store inventories said stock levels were generally in good shape for 2004, and all districts reporting on expectations for future retail sales anticipate continued improvement in the months ahead,"
the Fed said.
Auto sales either improved or held steady in most districts, the Fed said.
Manufacturing activity increased in nearly all districts and some districts noted factory employment "had begun to edge up as well," the Fed said. New York, Philadelphia and Kansas City cited some growth in factory employment.
"Manufacturers across the country generally expect factory conditions to continue to improve in the months ahead, and several districts noted that capital spending in 2004 will be somewhat higher than in 2003," the Fed said.
Housing remained strong, particularly in the Boston and San Francisco districts, the Fed said. Commercial real estate was still weak, but a few districts reported some improvement.
Travel and tourism "improved substantially," the Fed said. Several districts reported a surge in visitors to ski resorts because of good snow conditions.
Boston reported a positive outlook for international bookings due to the lower dollar and promotional fares, the Fed said.
Bank loan demand was flat or slightly lower, with credit quality generally unchanged, the Fed said. |
