South By North Strategies, Ltd.

Service Activity In The South Atlantic: Dec. 2011

From the Federal Reserve Bank of Richmond’s latest survey of service-sector activity in the South Atlantic (District of Columbia, Maryland, North Carolina, South Carolina, Virginia and West Virginia):

Activity in the broad service sector gained momentum in December, bolstered by improvement in the non-retail services subsector, according to the latest survey by the Federal Reserve Bank of Richmond. However, total retail sales slowed and big-ticket sales weakened compared to November’s survey. Shopper traffic flattened at retail establishments. Retail inventories increased more slowly than a month ago. At non-retail services firms, revenues rose sharply in December. Survey participants were upbeat about business prospects for the first half of 2012.
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Hiring picked up notably at non-retail services firms, while retailers reduced their payrolls further this month. Average wage increases prevailed in the service sector.
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Price change in the overall service sector increased at a slightly faster pace in December than in November. Looking ahead six months, survey respondents expected prices in the broad service sector to increase at nearly the same rate as their outlook a month ago.

Around The Dial – January 4, 2012

Economic policy reports, blog postings, and media stories of interest:

• Paul Krugman argues that “nobody understands debt.”
• James Surowiecki explains the logic of layaway.
• Josh Bivens offers a realistic view of the payroll tax cut.
• Martin Wolf weighs in on the debate over income inequality.
• Brad DeLong describes “America’s financial leviathan.”

Washington’s Lost Year

The Huffington Post reports on Washington’s failures to deal with the nation’s economic problems in 2011.

Those meager provisions likely prevented the economy from falling back into recession, but in the year since Obama cut that deal with congressional Republicans, economic growth has averaged a pathetic 1.2 percent. The unemployment rate has fallen from a horrific 9.8 percent to a merely terrible 8.6 percent. But much of that progress is illusory — millions of out-of-work Americans have simply given up all hope of finding a job, a situation that isn’t captured by the unemployment statistics.
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Today there are nearly 1 million homes scheduled for a foreclosure auction, down from about 1.5 million at this time last year, but again, there’s less to the improvement than meets the eye. Widespread legal challenges to fraudulent foreclosures have forced banks to slow down the eviction process.
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The same Wall Street firms that sent the economy into a tailspin remain broadly unaccountable. The robo-signing of foreclosure documents, in which banks process foreclosures at lightening speed without proper review, is still taking place. Most of the major new bank regulations required by 2010’s Wall Street reform legislation have been delayed. The new Consumer Financial Protection Bureau, perhaps the signature achievement of last year’s bill, has no director. The Federal Reserve Board of Governors is short two members.

Manufacturing In the South Atlantic: Dec. 2011

From the Federal Reserve Bank of Richmond’s latest survey of manufacturing activity in the South Atlantic (District of Columbia, Maryland, North Carolina, South Carolina, Virginia and West Virginia):

Manufacturing activity in the central Atlantic region firmed somewhat after stabilizing in November, according to the Richmond Fed’s latest survey. The index of overall activity edged higher as positive readings for shipments and new orders offset a slight decline in the reading for employment. Modest improvement was also evident in most other indicators. District contacts reported that backlogs turned positive and noted that capacity utilization steadied. Delivery times were virtually unchanged, while finished goods inventories grew at a slightly faster rate.
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Looking ahead, assessments of business prospects for the next six months were less optimistic in December. Contacts at more firms anticipated that shipments, new orders, backlogs, capacity utilization and capital expenditures would grow more slowly during the next six months.

Editor’s Note

Policy Points is taking some time off to celebrate the Christmas and New Year’s holidays. Regular posting will resume on January 4, 2011.

Also, South by North Strategies’ biannual review of the North Carolina labor market will appear in early January. This review will cover the trends of the last half of 2011 and review the year’s developments.

Thanks for your interest in Policy Points. Merry Christmas, and best wishes for 2012.