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Politics : Impeach George W. Bush -- Ignore unavailable to you. Want to Upgrade?

To: Neocon who wrote (5825)	8/8/2001 4:40:23 PM
From: TigerPaw	Read Replies (6) \| Respond to of 93284

no evidence of a rebound from the ongoing slump *Economy still weak, Fed survey says* By George Hager, USA TODAY 08/08/2001 - Updated 03:52 PM ET Related What's going on in the Fed's 12 regions? The Federal Reserve's latest look at the economy finds no evidence of a rebound from the ongoing slump, a picture that raises the odds that Fed policymakers will cut interest rates again when they meet next on Aug. 21. Instead of the hoped-for recovery, the Fed's 12 regional banks report signs that weakness in the factory sector is spreading to other businesses, while wary consumers are cutting back shopping and curtailing vacation travel. The findings come from the Fed's latest "beige book," a survey of the economy known for the color of its cover. The largely anecdotal report is put together 2 weeks before each Fed meeting by the Fed's district banks, whose staff talk with business people in their regions to get an idea of how things are going. The resulting report gives a real-life, real-time flavor to policymakers' otherwise data-driven discussions. Fans of the beige book say it sometimes helps them pick up on trends that won't be evident in statistics until later. Lately, the anecdotes haven't been very encouraging. The last report, in mid-June, described the economy as "little changed or decelerating." The latest report, which covers June and July, reports "slow growth or lateral movement" in an economy that seems to be stuck in a profound slowdown, despite six Fed rate cuts this year. As it has since last fall, manufacturing activity continued to weaken "as producers adjusted to weak domestic and foreign demand and worked through accumulated inventories," the report says. The factory sector has been in its own, deep mini-recession for almost a year, but policymakers had hoped there would be minimal contagion in the much larger service sector. That hope might be fading. "Sustained weakness in the manufacturing sector spilled over to other businesses, with many districts indicating declines in demand for office space and trucking and shipping services," the report says. With factories weak and service businesses under pressure, a key prop holding up the economy has been the consumer, but there are signs of weakness there, too. "Retail sales were generally sluggish and frequently below expectations," the report notes. And "layoffs and slower economic growth reportedly damped tourism in many parts of the country," the survey says. There were a few bright spots. As it has throughout the slowdown, the residential real estate market remained strong in June and July, as consumers continued to buy houses, lured by relatively low mortgage rates. And the flip side of the weakening job market and slow economic growth is less upward pressure on wages, which policymakers worried last year might climb high enough to spark inflation. Finally, falling prices for oil and gasoline eased pressure on businesses and consumers, enough to allow some shipping firms and truckers to reduce or remove fuel surcharges they had imposed earlier this year. TP