Beige Book Synopsis in Two Words: Modest, Moderate (In One Word – Useless)

The Fed’s Beige Book is a summation of useless anecdotal information compiled by Fed governors from each of the Fed’s 12 regions, eight times a year.

The report is 36 pages long so inquiring minds may be seeking a short version.

Rates of Expansion

• Moderate Expansion: San Francisco, Cleveland, New York
• Moderately Expanding: Dallas
• Modest Expansion: Philadelphia, Chicago, St. Louis
• Modestly Expanding: Richmond, Kansas City, Minneapolis, Atlanta
• Modestly to Moderate Expansion: Boston

Those keeping closer score will note that Chicago “growth slowed to a modest pace”. Emphasis mine.

St. Louis “economic activity improved at a modest pace”.

In Kansas City, “manufacturing and other business services expanded at a moderate pace, and energy activity continued to increase modestly”.

Boston business reports indicate that “revenues at most manufacturing and retail firms continued to expand modestly to moderately”.

I will spare you the drivel about other regions.

Autos

• Overall: “Auto sales declined modestly…. Reports from most retailers indicated that sales increased slightly while auto dealers noted soft sales activity.”
• Philadelphia: Auto dealers throughout the region reported that the slight year-over-year sales declines of the prior period had deepened to a modest rate during the current period, although the level of sales remains high. Prices are very competitive and manufacturers are providing significant dealer incentives to move inventory. Dealers expect manufacturers to back off production next year.
• Cleveland: Auto dealers are concerned about above-normal inventories. Customers are reportedly waiting for higher OEM incentives. Year-to-date production through July at District auto assembly plants declined more than 16 percent when compared to that of the same period a year earlier. Much of the decline can be attributed to retooling for three next-generation vehicles.
• Richmond: An auto dealer in coastal South Carolina reported that sales had leveled off and that inventories continued to build, so he expects manufacturers to offer even more incentives in coming months.

There are pages of similarly useless drivel on retail spending, housing, wages, commercial real estate, etc., telling everybody what they already know.

There was not a single thing in the report that was not already widely known, in greater detail. How much money is wasted compiling this drivel?

Mike “Mish” Shedlock