"‘Out of Recession’"

[Clio the Leo]

‘Fed Beige Book Says Economy Improved in 10 Districts ’

y Michael McKee

Jan. 13 (Bloomberg) -- The U.S. economy improved in 10 of the Federal Reserve’s 12 districts last month, marking a broadening of the recovery, the central bank said today.

“While economic activity remains at a low level, conditions have improved modestly further,” the Fed said in its Beige Book business survey, published two weeks before the Federal Open Market Committee meets to set monetary policy. The Philadelphia and Richmond Fed districts were the exceptions, reporting “mixed conditions.”

The Beige Book offers anecdotal evidence that will help central bankers weigh developments in an economy where unemployment is projected to remain above 10 percent through the first half of the year. Policy makers, who next meet Jan. 26-27, last month repeated a pledge to keep borrowing costs “exceptionally low” for an “extended period.”

Most district banks reported that holiday-season consumer spending was “slightly greater” in 2009 than the year before, while remaining “far below” levels of 2007, according to the report, which reflects information collected through Jan. 4. Manufacturing improved or held steady in most districts, while the labor market and loan demand remained weak.

The Standard & Poor’s 500 Index extended gains after the report, rising 1 percent to 1,147.08 at 3:42 p.m. in New York. The yield on the 10-year Treasury note was up eight basis points to 3.79 percent.

‘Picking Up’

The report “suggests the economy is very gradually gaining steam,” said Zach Pandl, an economist at Nomura Securities International Inc. in New York. “The risks of a dip back into recession are declining.”

Chicago Fed President Charles Evans said separately today that economic “headwinds” such as tight bank credit will abate this year. Evans, in a speech in Coralville, Iowa, said the economy may expand 3 percent to 3.5 percent with inflation remaining stable as bank lending and consumer spending pick up.

“We are going to be waiting for the economy to improve in a strongly sustainable fashion and until that happens, then it is unlikely we would change policy,” Evans, who doesn’t vote on interest rates this year, told reporters after his speech. “Inflation currently is under-running my guideline for price stability so that also supports continued accommodation.”

Employers unexpectedly cut 85,000 jobs in December, the Labor Department reported on Jan. 8, and the jobless rate was unchanged at 10 percent, close to a 26-year high. Payrolls have declined by more than 7.2 million since the recession began in December 2007.

‘Out of Recession’

“Most people would agree we’re out of recession, but I just don’t think we’re going to see the unemployment rate coming down all that much very soon,” said Robert MacIntosh, chief economist at Eaton Vance Management in Boston.

http://www.bloomberg.com/apps/news?pid=20601087&sid=alEA5QV8_qdU&pos=3

[DJ13]

1. “Most people would agree we’re out of recession"

Maybe on Wall Street, or in a WH desperate to claim victory without actually impeding their giveaways to the banks and insurance companies by expending any energies trying to help the average person recover, but no one I know thinks were out of the recession.

[phleshdef]

7. No one you know gets to decide. Its not a matter of opinion. Its a matter of mathematics.

[DJ13]

9. Sorry, but economics also has a psychological component

Its not pure mathematics.

[phleshdef]

10. No need to apologize. Its okay for you to be wrong. Recession has a definition.

Its not up to how someone feels psychologically. You don't GET to decide what it means. It has an objective definition and thats that. There is no room for debate.

[DJ13]

11. You're a hoot

Tell the people down your street who are losing their house to foreclosure after they lost their jobs that the recession is over.

I suggest you duck as soon as you say it.

[boppers]

14. Do they have on opinion on pi, as well? How about e? Can they choose what a pound weighs?

Negative GDP for 2 quarters. NBER determines when this begins, and ends.

It's really quite sad, the anti-educational attitude in the US today. People honestly think that their opinions are greater than basic math and science.... which explains why there are so many freaking creationists and people who can't figure out how genetics works.

[depakid]

12. The technical distinction between recession and jobless recovery is usually lost

on people in communities where there's persistent unemployment, underemployment- and a relatively high number of "discouraged" individuals who aren't even counted.

[PBS Poll-435]

2. Gotta love the D&G Unrec Crew....

K&R

[Cha]

5. Yeah, they're

stagnating.

[Double T]

3. Look around. Does it look like the recession is over?

Small businesses are going out of business, unemployment is getting much worse despite the government's bogus way of reporting the actual number of unemployed (Actual unemployed Americans is nearly 18%). Foreclosures and loan and credit card defaults continue to rise. It is an election year and PAID economists will tell the entity writing the check whatever they want to hear. There are a lot of Americans suffering; hopefully that will transfer to the ouster of most incumbents in the 2010 elections.

[boppers]

15. Where are you looking?

That can make a big difference, I've found.

[levander]

4. Economists' definition of recession is different than main street's

According to the economists, we're now after the recession, in recovery. In the study of economics, unemployment is a trailing indicator of a recession. It starts after the recession does, and it doesn't get better until after the recession is over.

But, average folk don't differentiate between the two. Until unemployment gets back to sane levels, as far as main street is concerned, we're still in a recession.

[golfguru]

6. Until jobs recover, it won't matter

Real people need real jobs, not articles from financial newspapers.

[IndianaGreen]

8. Larry Summers also said the Great Recession was over

Real unemployment is around 17%, far higher than the "official" figures. I don't see things getting any better!

[paulk]

13. the unemployment rate is a far more meaningful stat

than the technical definition of "recession".

[jeanpalmer]

16. It's like going to Vegas

and losing $1,000 a night for 10 nights in a row, and then winning $1,000 on the 11th night. These economists would say you're in recovery, though you're still down 9 grand. It's another one of teir shell games.