I’ve provided some highlights from the Fed’s Beige Book.  I am not sure how useful this information is seeing as how the Fed has been wrong at nearly every step of the road over the last 20 years, but it provides a fairly good idea of the current landscape:

Reports from the 12 Federal Reserve Districts indicated either stabilization or modest improvements in many sectors since the last report, albeit often from depressed levels. Leading the more positive sector reports among Districts were residential real estate and manufacturing, both of which continued a pattern of improvement that emerged over the summer. Reports on consumer spending and nonfinancial services were mixed. Commercial real estate was reported to be one of the weakest sectors, although reports of weakness or moderate decline were frequently noted in other sectors.

Reports of gains in economic activity generally outnumber declines, but virtually every reference to improvement was qualified as either small or scattered

The weakest sector was commercial real estate, with conditions described as either weak or deteriorating across all Districts.

Consumer spending remained weak in most Districts since the last report, although some improvements were noted.

Looking to expectations for holiday sales, Chicago anticipated improved sales, while Philadelphia retailers expected consumers to limit spending.

Most Districts reported that manufacturing activity was generally stronger since the last report. New York, Richmond, Minneapolis and Kansas City all noted a further pickup in production, while Philadelphia, Cleveland, Chicago and San Francisco mentioned slight-to-moderate increases. Growth rates varied by industry, however, and some Districts experienced little or no overall increase

Most Districts reported that housing market conditions improved in recent weeks, primarily from a pickup in sales of low- to middle-priced houses. Contacts reported that sales were boosted by the government’s tax credit for first-time homebuyers.

Many Districts continued to report weak or declining loan demand, and many noted further erosion of credit quality.

Labor market conditions were generally reported as weak or mixed across Districts, but a few encouraging signs were noted.

Wage and price pressures were generally described as subdued across most Districts.

In short, consumers are weak, employment is in the doldrums, wages are flat, real estate is still in the toilet, but the Stimulus programs and Fed liquidity programs are making everything temporarily appear back to normal…..

The full report is here.