The Fed's Beige Book: AP Needs a Geography Lesson

FedTheBeigeBookGraphic0910For the record, here are the first and fourth sentences from the Federal Reserve's Beige Book released earlier this afternoon:

Reports from the twelve Federal Reserve Districts suggested continued growth in national economic activity during the reporting period of mid-July through the end of August, but with widespread signs of a deceleration compared with preceding periods.

... However, the remaining Districts of New York, Philadelphia, Richmond, Atlanta, and Chicago all highlighted mixed conditions or deceleration in overall economic activity.

It may be fair to describe the detail in Atlanta's section of the report as "mixed" (it's a borderline call; the opening paragraph from that District's report will appear later). But Richmond's section is clearly one of deceleration, which brings us to today's clearly needed geography lesson for Jeannine Aversa and/or a headline writer at the Associated Press.

What follows is a graphic containing the headline at Aversa's 2:45 p.m. story (since updated here), and her first few paragraphs:


That's clever.

By isolating slower growth to the "East" and "Midwest" (really "decelerating," a somewhat stronger term that implies a trend of ever-slower growth instead of a onetime event), the AP's headline writer would appear to be attempting to limit the full brunt of the Beige Book's relatively bad news. The fact is that the declining Richmond District includes Virginia, North Carolina, South Carolina, and West Virginia, many of whose non-DC Beltway residents would be surprised to learn are considered "East" by the AP's headline writer.

The opening paragraph about Atlanta is mixed, but contrary to the AP's communicated geography, some of the bad news is neither in the "East" nor the "East Coast," no matter how far you try to stretch the definition (bold is mine):

Sixth District business contacts indicated that the pace of economic activity continued to slow in July and August. Retailers reported a decrease in traffic and sales, and their outlook was less positive than in previous months. Reports from the District’s tourism sector were mixed as contacts outside of the oil-spill affected Gulf coast experienced positive growth, but areas from Louisiana to the Florida panhandle saw significant declines in visitors. Residential real estate contacts noted that the pace of new and existing home sales slowed, and their outlook remained pessimistic. Nonresidential real estate activity remained weak. Manufacturers reported that the pace of new orders growth slowed. Banking credit conditions remained constrained and loan demand was reportedly weak. Labor markets improved modestly, but most businesses maintained a strong preference for increasing the hours worked of existing staff and expanding their use of temporary hires rather than for hiring permanent employees. Transportation and material prices rose slightly, but most firms expressed limited ability to pass increases through to consumers. 

The bolded item would seem to indicate that contacts actually in the Gulf didn't see growth in the tourism sector. That would include Louisiana, Mississippi, and Alabama, none of which have recently been known to be located in "the East" or "East Coast."

Additionally, the two tidbits that follow in Atlanta's section of the report allude to other forms of deceleration occurring in those decidedly non-"Eastern" states:

  • "areas from Louisiana to the Florida panhandle saw significant declines in visitors."
  • "Most District merchants reported that traffic and sales decreased in July and August."

Jeannine Aversa would have been better off simply publishing the first four sentences of the Beige Book and going home. A public attempting to stay informed would have been better off with a headline reading "Fed releases Beige Book, identifying regional economic trends."

Cross-posted at

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