Industrial Output Sags

According to the Federal Reserve, U.S. industrial production decreased 0.6 percent in November compared with October, with a number of sectors’ output declining, but especially cars. Manufacturing of motor vehicles and parts fell 2.8 percent in November compared with October, when it was down 3.6 percent from. Year-to-date, auto production is down 21.4 percent. The markets apparently didn’t care much for those numbers, with the Dow dropping 0.67 percent, and the S&P 500 and the Nasdaq down 1.23 percent and 2.07 percent, respectively. Fannie Mae has decided to sign new leases with renters occupying houses that the company now owns because of foreclosure, rather than evicting them. The move will directly affect some thousands of renters, and may nudge banks to similarly become reluctant landlords. The New York Times noted this morning that “skyrocketing foreclosure rates have exposed as many as 70,000 renters to evictions” in recent months. The Fed is expected to lower its benchmark interest rate to a scant 0.5 percent tomorrow, or maybe even 0.25 percent, which is almost a hypothetical number anyway, since there hasn’t been much demand for interbank loans lately. Then what? Nontraditional monetary policy, that’s what, also known as “quantitative easing,” or “the Fed pumping a lot of money into the banking system,” to use layman’s terms. Meanwhile, investigators of various stripes are poring over Bernie Madoff’s books–if indeed he practiced bookkeeping in the way the financial industry generally uses that term–to see how one man could orchestrate such a large destruction of wealth. (It’s easy to understand how the one industry, namely the auto industry, could do that, but one affable money manager?) Questions about how much help the old man had, particularly from his family, have naturally surfaced, and lists of woebegone Madoff investors are being updated on various websites seemingly minute-by-minute, including bank after bank around the world: HSBC (U.K.), Nomura (Japan), BNP Paribas (France) and Santander (Spain) among others. From Las Vegas, which has suffered the worst popped housing bubble in the nation, more bad news: The Nevada Gaming Control Board has reported that revenue at the state’s casinos was down by 22 percent