The Chicago survey is very susceptible to changes in conditions in the auto industry, where activity has been very volatile in recent months. |
The data confirm that the labor market is still not generating the sort of cost pressures many analysts expected with 4 percent unemployment. |
The data suggest real consumers' spending rose marginally last month -- but we still expect only a 1.5 percent annualized increase in the fourth quarter, |
The details are close to our expectations, though consumers' spending, up 5.5%, was a bit stronger than we expected. Overall, solid domestic final demand, but the second quarter will be much weaker. |
The details are not as important as the overall message, which is that to the extent that the U.S. economy faces an inflation threat, it is not coming from core goods prices. |
The drop in stock prices is no excuse to beginning cutting rates, as some in the market desperately want to believe, ... Given where oil prices are and given what the fundamentals still suggest, I don't see the Fed doing anything for the time being. |
The drop in the headline sentiment index likely reflects war fears and may well be mirrored in Thursday's Philly Fed, |
The drop in the headline sentiment index likely reflects war fears and may well be mirrored in Thursday's Philly Fed. |
The Fed can and will be much more of an active player in the stock market until it turns the corner, |
The Fed chairman is not habitually in the business of delivering shocks to the markets unless the circumstances are especially dire. That is certainly a fair description of the situation in the states hit by Katrina, but it does not apply to the rest of the economy. |
The Fed has begun to prepare the markets for higher interest rates, ... almost balanced. |
The Fed is nearly done. The U.S. economy is coming back. |
The Fed is now explicitly conducting monetary policy with the aim of supporting stock prices, |
The Fed will deal with (the housing-jobs mix) by hiking in January and March and hoping that the housing softening will be sufficient to get them off the hook by May, though I think that's a close call. |
The Fed will likely ease on Nov. 6, but the Beige Book has not changed the odds, ... And it tells us nothing about the future of the economy or Fed policy. |