The Federal Reserve released its latest beige book report detailing economic conditions across the country based upon observed evidence and conversations. The 12 Fed district banks "indicated that the pace of decline has moderated since the last report or that activity has begun to stabilize, albeit at a low level."
It indicates that retail activity is weak with essentially no wage pressure. This may be good news on the inflation front but is negative for the employment situation. There was some improvement in healthcare and technology.
There are positive indications that a bottom may be forming in the economy. However, there is very little evidence of a strong bounce. The market has experience very little movement in either direction since the report was released.
Until we get additional evidence on the strength of the recovery, economic headwinds are likely to remain. Employment numbers are going to remain important. Until anxiety about job security is alleviated, it is very difficult to see any sustained rebound in consumer spending.
Doug Roberts is the Founder and Chief Investment Strategist for ChannelCapitalResearch.com, an independent research firm focusing on investment strategies using the Federal Reserve's impact on the stock prices.
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