Thursday, October 20, 2011

The Fed's Beige Book

I wrote this post on Tuesday suggesting there are few reasons to believe that the US economy is in recovery or expansion, and more to expect some sort of continued sluggishness or recession.

Yesterday's Fed Beige book release didn't seem to help matters. Today's Wall Street Journal article on the subject stressed the report's mention of weak economic growth and no good news on jobs. In short, the good news was, well, no really bad news.

On Bloomberg television after the report's release, a Chase economist kept saying there won't be another recession, but that was about it. He seemed mostly focused on that point, while soft-pedaling when pressed by the anchor to discuss any really good economic news from the Fed.

This morning's housing data featured a drop in the sale of existing homes. Meanwhile, Angela Merkel cancelled her big speech to the German legislature on the Euro bailout mess. Grecians continue to riot.

The result in US equity markets? A 1200 S&P, plus or minus a few points depending upon exactly when you look today. Sustained volatility.

Hardly what I'd call the underpinnings of a strong, healthy, vibrant equity market.

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