1. State of the Economy

2. U.S. ECONOMY TODAY RESIDENTIAL REAL ESTATE MARKET WEAK HOME SALES LOW DEPRICIATION OF PROPERTY VALUE

3. REAL ESTATE LENDING IN THE CONSUMER MARKET POTENTIAL BUYERS ENCOUNTERED DIFFICULTY FINDING FINANCING HARSHER TERMS IN LENDING

4. WAGE MODERATE OR LIMITED WAGE GROWTH WAGE PRESSURE FROM THE PEOPLE IS REPORTED TO BE MODERATE. EXCEPT FOR A FEW SKILLED LABOR POSITIONS

5. TOURISM/AUTOMOBILE LOW TOURISM DUE TO HIGH GAS PRICES PEOPLE TAKING VACATIONS CLOSER TO HOME DROP IN CAR AND LIGHT TRUCK SALES, BUT SALES IN FUEL-EFFICIENT CARS IS SOLID.

6. PRICES PRICE INCREASES FOOD, CHEMICALS, ENERGY, METAL, AND PETROLEUM INCREASE IN INPUT COST PASSED ON TO CONSUMERS, BUT EXPECTED PRICES CONTINUE TO RISE

7. MINNEAPOLIS GROWTH AT A SLUGGISH PACE FROM LAST YEAR

8. REAL ESTATE MINNEAPOLIS IS NO EXCEPTION TO THE HOME CRISIS. HOME SALES DROPPED 6% IN MINNEAPOLIS HOME VALUE DROPPED BY 4% STATEWIDE IN WISCONSIN.

9. REAL ESTATE

10. UNITS PERMITTED FOR CONSTRUCTION FELL 67% IN APRIL FROM LAST YEAR IN THE ST. PAUL AREA IN MINNEAPOLIS

11. REAL ESTATE COMMERCIAL CONSTRUCTION HAS SLIGHTLY INCREASED NEW HOTELS BEING BUILT IN SOUTH DAKOTA THROUGHOUT THE WESTERN PART OF THE DISTRICT THERE IS EXPANSION

12. WAGES/LABOR LABOR MARKETS ARE FLAT GREAT NUMBER IN LAYOFFS DUE TO TIGHT EMPLOYMENT A PRODUCER OF COMPUTER DISKETTES WILL CLOSE ITS PLANT BY END THE YEAR IN NORTH DAKOTA LEAVING 390 WORKERS OUT OF THE JOB

13. WAGES/LABOR LIKE THE REST OF THE COUNTRY MINNEAPOLIS HAS HAD A MODERATE INCREASE IN WAGES THE MINNEAPOLIS FED EXPECTS WAGES AND BENEFITS TO GO UP 2.4% PER WORKER IN THE NEXT 12 MONTHS

14. PRICES MINNEAPOLIS HAS HAD AN INCREASE IN PRICES PRICES FOR STEEL/ALUMINUM HAVE GONE UP 35% FLOUR PRICE HAS RISEN 130% IN THE PAST 3 MONTHS, WHICH HAS LED TO AN INCREASE IN PRICE FOR A LOAF OF BREAD

15. TOURISM MINNESOTA BASED AIRLINE HAS RAISED ITS PRICES DUE TO HIGH GAS PRICES THE TOURISM IN SPRING WAS DOWN DUE TO THE WET, COOLER THAN USUAL WEATHER HOPES ARE UP FOR THE SUMMER

16. AGRICULTURE DUE TO BAD WEATHER CONDITIONS THERE IS A DELAY IN PLANTATION AND DEVELOPMENT OF CORN AND SOYBEAN FARMERS CONCERNED THAT HIGH COSTS IN INPUT WILL LEAD TO HIGHER PRICES FOR CONSUMERS IN SOYBEAN, WHEAT, AND CORN

18. Change in Money Stock

19. Proposition AN INCREASE IN THE CURRENT FEDERAL FUNDS RATE BY 25 BASIS POINTS

20. Why worry about inflation now?

21. Changes in the CPI

22. Changes in Inflation Expectations