The Economy Is Beige

Check out the accompanying pdf and chart collection. Executive Summary: The stock market’s resilience since October 12 in the face of Fed rate hiking reflects the economy’s resilience. Measures of breadth for industry analysts’ estimates of S&P 500 revenues and earnings have been improving since early this year, and their optimism is supported by surveys of corporate purchasing managers. … The Fed’s latest Beige Book confirms that the banking crisis hasn’t knocked the economy off its rolling-recession path. … Also: We’ve known that QT and the banking crisis exert tightening forces equivalent to some amount of federal funds rate hiking. Now the SF Fed has quantified it, finding that the “effective” federal funds rate is currently over 6%.