Fed Shows Growing But Slowing Economy

Staff -- Graphic Arts Online, 11/1/2000

The most recent "Beige Book" report issued by the Federal Reserve Board provides further evidence of a moderate slowdown in U.S. economic growth, although it will be several months before data confirm this assumption.

Reports from a majority of the 12 Federal District Banks noted signs of slowing economic growth in their regions, although overall economic activity was still seen to be expanding in all areas. However there were none of the "bullish" kinds of signs that were still evident at this time last year, not that the status quo is too hard to swallow at current healthy levels of economic activity.

Furthermore, the Beige Book report serves as a good "reality check" for those economic analysts at the extremes who see either doom and gloom or continued unlimited boom for the U.S. economy, since it represents a comprehensive summary of comments received from businesses and other contacts outside the Federal Reserve system, and is not a commentary of Federal officials themselves. Consequently, the observations can be taken as being reasonably non-partisan and objective.

On balance, the latest Beige Book report showed exactly the sort of trends that the Fed would interpret as signs that the economy is coasting in for the not-too-hard-to-take "soft landing" that economic policymakers have been painstakingly attempting to engineer.