Industrial Production and the Economy

In the shadow of the Bear Stearns meltdown, the Federal Reserve’s announcement today on February industrial production did not get too much attention. But it made clear that the current woes are not just on the financial front, and provided another measure pointing to recession.

Industrial production fell by 0.5 percent in February. Manufacturing output was down 0.2 percent, after being flat in January.

When going down the market and industry groups for February in the Fed’s release, it’s hard to find any non-negative numbers.

This comes on the heels of industrial production growth at an annualized rate in the fourth quarter of 2007 of -1.0 percent. That included manufacturing coming in at -1.9 percent.

The U.S. economy needs more on the policy front than the gymnastics being performed by the Federal Reserve right now. The economy is crying out for solid pro-growth measures on both the tax and regulatory policy fronts.