RSS FeedFederal Reserve Reports Slow Economic Conditions– Open Market Committee Meeting Minutes
|
The Federal Reserve released their minutes for the March 10th Open Market Committee Meeting. This committee determines Fed interest rates and is held in secret although the minutes are released the next month. This meeting was held before the Federal Reserve gave JPMorgan Chase a $30 billion line of credit, in part to buy the assets of Bear Stearns.
The minutes go beyond describing a“financial” crisis and forecast a gloomy “economic” predicament. “Restraining credit availability and thus economic activity for a time and having the potential subsequently to delay and damp economic recovery,” the minutes report. Back in January the Federal Reserve report wasn’t so ominous.
Businesses have held back on their spending and hiring, according to the quadi-private central bank. But the report did state: “Industrial production declined in February after edging up slightly in the previous two months.”
Consumer spending has slowed while we saw higher food and energy prices. The Feds report that housing prices have been falling and this “further reduced household wealth in the first quarter.”
The declining home sales has prompted a slowdown in new construction. “Overall, demand for housing continued to be restrained by tight financing conditions for jumbo and nonprime mortgages,” according to the Feds.
There was some good news. Because the dollar is declining in value, our trade deficit has “narrowed substantially” in December. The weak dollar has also made it easier for American companies to compete here in the United State and abroad.
Oil imports rose substantially according to the report. “Oil imports soared, reflecting increases in both prices and volumes,” but most other categories of imports dropped in December and January.
Inflation rose “rapidly” in January, but flattened in February. The CPI (“consumer price index” is sometimes called inflation) does not include energy or food. The Feds predicted an “increase in world petroleum prices in early March pointed to a renewed burst of energy price inflation in the near term.” They got that right.
See what others are saying and join the discussion at our Forum
By Dan Wilson - Best Syndication News Writer
- Motives Questioned In Federal Reserve Line Of Credit For JPMorgan To Purchase Rival Bear Stearns
- The Wisdom Of Giving Authority To Federal Reserve Questioned– What is the Fed and is their Interest The Same As America’s?
- Federal Reserve Loans JPMorgan Chase Money To Buy Bear Stearns– Congress And President Have No Control Over Fed
- Google Profits Rise As Advertisers Shift To Internet– Yahoo To Release Report On Tuesday – SearchIgnite Reports Growth
- Google Adsense Glitch Affects Publishers Around The World
- Senator George Runner Speaks Out About SubPrime Lending Disaster
- Bank Interest Rates On Rise And Decline Around The World Depending On Location
- Roy’s Gas Station In Amboy Reopens – Café and Store Will Also Open – History Of Small Town
- 700 MHz C-Block Auction Results in Verizon and AT&T Getting most of the Spectrum
- Cantaloupe Recalled Because of Salmonella Outbreak– So Far 16 States Involved – Symptoms and Precautions