Stick around while we go immediately to Steve Liesman, who has been pouring through the Beige Book from the Fed and is still awake to tell about us. Steve. Come on, Tyler. There’s nothing more exciting than the Beige Book. And I want to tell you this is an interesting Beige Book for the following reason. I’m going to read you a bunch of the anecdotal reports that come from the 12 fellows or bank districts and they certainly sound at odds with some of the economic data that we’ve been talking about. Economic data has been strong. These comments are very modest and economic activity according to the Bayes book expanded only slightly, a little bit, pretty much the way it was last month, 10 to the 12 district reports slight or modest growth, which was up from 8 in the prior report. So a bit of an acceleration there, but at a very modest rate. Consumer spending, however, quote, barely increased. You remember we got that really strong retail sales report on Monday. There was weakness in discretionary spending. Consumers price sensitivity remained elevated, meant they were shying away from higher prices. Auto spending was up because of better inventories and incentives, ostensibly prices coming down. The economic outlook was cautiously optimistic among those who were serving, employment rose at a slight pace. That’s at odds with the strong employment reports. We’ve had 9 districts, 9 to the 12 that has reported slow to modest increases in jobs. Labor supply was seen improving. However, we have this persistent commentary throughout the entire post pandemic period, even before it of shortages of qualified applicants. Labor demand and supply were seen remaining relatively stable. Price increases, it’s the important part. We’re modest running at about the same pace as last report. Remember, we’ve been talking about slower sluggish inflation not coming down, while it was stable according to the base book. There were some shipping delays noted due to the Red Sea tensions and the Baltimore Bridge collapse, but not seen as a really acute issue there. There were sharp increases in insurance rates that we have seen in the inflation report and the ability, this is an important one to pass along cost increases to consumers has weakened and that has put pressure on profit margins. Inflation was expected to hold steady and there was some upside risk seen by manufacturers to inflation on both the input and output costs. So interesting, Tyler, there was a study recently done by the Cleveland Fed. So the base book does a pretty good job of predicting recessions don’t much about whether or not inflation, inflation is 1/2 a point higher or lower or GDP is, But it does a pretty good job of signaling in the language whether or not there’s a recession coming. This obviously is not a recessionary call, but it is or it does sound and feel weaker than the other economic data we’ve been talking about. And is that the surprise in this report? If there is a surprise, it is to me and I I know you were joking about the Beige Book, but I find this report to be very helpful in kind of understanding two things. One is where the economy is going and what’s actually going on, but also what the Fed is hearing from their contacts. We do get a little behind the scenes look here because Fed officials do meet with businesses all around the country all the time. And so this is what they’re hearing here. And they’re hearing a story of a somewhat weaker economy than the story being told by the day. Yeah. No, I don’t mean to bees. Diss the Beige Book at all. Diss the Beige Book. No, no, it’s valuable. I just love. I’m just endlessly better Colour. I’m endlessly amused. The Beige Book, it’s maybe to be like a yellow book. It’s just, yeah, we have one of those with the green book. Keith, any thoughts here on the Beige Book? And how do you like beige, Keith? Well, beige is a great color as far as I’m concerned, and that was about as succinct A rundown as I have ever heard on the Beige Book. So my hat’s off to Steve. I couldn’t have done that. But I think Steve raises a very interesting point by highlighting the difference between recent data and the Beige Book. So the markets have accelerated faster than the headlines and data points like that can keep up. So really the message is, do we or don’t we believe the data points and if so, which ones? I’m gonna go with the CEO’s in the companies every single day because I think the Fed’s data is rearward looking, whereas I think CEO’s who are in charge of making money for their shareholders are forward-looking.
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