Fed Report Suggests Some Sections of the U.S. Economy Are Struggling While Others See Success

Washington, D.C.–A report issued Wednesday by the Federal Reserve shows the U.S economy is regionally mixed, with some areas slowing significantly and others hardly at all. The Fed’s “beige book,” which compiles business status reports from around the U.S., reveals the nation is working to challenge the housing and credit slumps’ effects, according to The Washington Post.The report suggests economic declines are present only in some industries. Several big banks announced multibillion-dollar write-downs recently; yet regional banks remain steady. Unemployment is up in the construction industry but not in the engineering or consulting sectors. Consumer debt has increased in highly populated states such as Florida, California and Michigan–but other states appear stable.The greatest economic trouble seems to be in key mortgage crisis states, including Arizona and Ohio, the Fed says. Economists feel the construction, manufacturing, financial service and housing sectors have been the most affected.However, the overall economy has been troubled by quickly increasing food and energy prices. The Labor Department said Wednesday that consumer prices shot up 0.3 percent in December, which could affect households in the same way a tax increase would. In 2007, food prices grew 4.9 percent–the largest increase in 18 years.Federal Chairman Ben Bernanke is scheduled to speak to the House Budget Committee Thursday; he has previously stated he feels a plan to stimulate the economy might help, although he has declined to support a specific method.On Wednesday, Sen. Charles E. Schumer (D-N.Y.) told the committee that Bernanke “said that while he wasn’t going to endorse a specific plan, if an economic stimulus package was properly designed and enacted so that it enters the economy quickly, it could have a very positive effect on the economy.”