Fed Report Shocker: The Economy Is Still Bad

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Jae C. Hong / AP

A for sale sign stands outside a bank-owned home.

Current Economic Conditions, February 2009
Federal Reserve Bank of San Francisco
50 pages

The Gist:

Released eight times a year, the Federal Reserve's Beige Book, a survey of anecdotal, regional economic conditions, is not normally a document that most people peruse even in the best of periods. Now that the bad times are upon us, however, many might see such a report — which states that the economic deterioration was "broad based" — as an exercise in masochism. (Read "A Grim Job Outlook for College Seniors.")

Highlight Reel:

1. On the laid-back nature of laid-off New England retail employees: "Retailers continue to manage inventory levels tightly...Most respondents have invoked hiring freezes and some have already reduced or are considering reducing headcount in the near future. Several contacts have have also frozen wages or eliminated bonuses or retirement contributions, and note that employees have taken the news of these freezes and jobs cuts 'remarkably well.'"

2. On the New York City hotel industry's unfortunate decision to keep building: "Occupancy tumbled roughly 15 percent from a year earlier in January, while average room rates fell 15 percent. While much of the weakness reflects softening demand, an industry contact notes that about half the decline in occupancy rates is due to new hotels opening; the total number of hotel rooms in Manhattan is expected to increase by roughly 7,000 (10%) in 2009, or more than triple the net increase in 2008."

3. On the poor timing of a Texas drought: "The dry spell continues to grip much of the District. Wheat and oat crops are suffering from lack of moisture. Grazing conditions are poor as well...Hay stocks are low and feed costs remain high, forcing some ranchers to cull their herds. District dairy producers report weak conditions."

The Lowdown:

Sure, you know things are bad. You've heard stories from friends and family about getting laid off and have read news pieces about cutbacks at factories in some part of the country far from where you live. But, as dry as much of the Federal Reserve Beige Book can be, there's something calming about its comprehensiveness, a sense of solidarity in misery. Oil extraction is poor in Texas, restaurants in San Francisco are doing badly, and the peanut industry — let's not talk about the peanut industry. The Fed predicts things are going to get worse over the next year. Flip through this report, despair, then go watch a Pixar flick.

The Verdict: Skim

See the Fed's Bleak December Report.

See TIME's Pictures of the Week.