Surprise surprise.

Commercial real estate slowing

credit crunch expanding its grasp

all districts reporting tighter lending standards

inflation: elevated price pressures, but wage pressure is moderate (which is considered a key factor).

exports helping manufacturing, but growth slowing in several districts

capital spending mixed

certain distressed areas, real estate inventory declining.


just like DJ Jazzy Ben and the Gang like to say, "we'll have to continue to monitor inflation carefully." We'll keep an eye out to see if there is any MBS reaction to those embedded inflation comments. But the focus is on a weak, weak economy, which is largely priced into the market, but you know me and my bear suit! Could always go lower....

Any pertinent updates, we'll get to you ASAP.