economic activity. In the New York Times Business Day section, The Commerce department reported “Consumer spending fell 1.8 percent in September and that Construction Spending declined 0.4 percent in September, the fifth consecutive monthly drop. The decline brought spending to $843.1 billion at an annual rate, the slowest this year. The drop in Consumer Spending, after a rise of 0.3 percent in August, was larger than expected and the sharpest since January 1987, when blizzards kept shoppers at home. Growth in personal incomes, which rose less than 0.1 percent in August, was the weakest since incomes fell 3.9 percent in January 1994.” Many analysts believe that the country is now in a recession, which will probably last until next year. Because of the attack on America, Feds are trying to cut interest rates. The New York time reports, “The rate is now the lowest in four decades. Investors are expecting a quarter-point cut next week and another quarter-point decrease by the end of the year, based on trading in federal funds futures contracts. The factory report on November 2, showed little threat from inflation, making it easier for the Fed to lower rates. The index of prices paid for raw materials fell to 32.5 in October, the lowest in more than fifty years, from 36.3 the previous month.” The University of Michigan’s initial report on consumer confidence for September showed a large, unexpected decline. While most economists had earlier predicted that the economy would recover later in the year, the August Blue Chip consensus predicted GDP growth of 1.7 percent in the third and 2.8 percent in the fourth, which made it seem possible that the current disruptions could push GDP growth into retrenchment and potentially recession.The attack on the World Trade Centers has caused a major drop in the stock market. One of the nation’s largest bond dealers continues to struggle to put their business...
