The Federal Reserve provided fresh evidence Wednesday that the financial crisis is hammering the economy, sending the stock market plummeting as fears of a long recession increase.

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WASHINGTON — The Federal Reserve provided fresh evidence Wednesday that the financial crisis is hammering the economy, sending the stock market plummeting as fears of a long recession increase.

The news came in the Fed’s “Beige Book,” a report released eight times a year with economic input from the Fed’s 12 regional banks.

Here are some questions and answers about the Fed’s Beige Book:

Q. What is in the Beige Book and how is it compiled?

A. The book primarily consists of anecdotal information from the Fed’s 12 regions about trends in consumer spending, retail sales, manufacturing and real estate, among other areas. It also includes a summary of all the district reports.

The reports are compiled from interviews with business executives, economists, financial experts and other sources.

Q. What did the latest Beige Book say about the economy and the financial crisis?

A. It painted a pretty bleak picture, reporting slower economic activity in all 12 districts. According to the report, consumer spending dropped in most districts, manufacturing slowed and loans have become harder to get for consumers and businesses.

Consumer spending is particularly key because it accounts for two-thirds of gross domestic product — a measure of the value of all goods and services produced within the U.S.

“A black eye from the Beige Book,” Michael Hanson, an economist for Barclays Capital, wrote in a note to clients.

Q. Why do economists and the markets pay attention to the Beige Book?

A. Because it provides real-world evidence of economic trends and details that can’t be found in dry statistics.

“It gives color to the picture that is too often shades of gray,” said Diane Swonk, chief economist for Mesirow Financial, a Chicago-based financial- services firm.

The Beige Book is also compiled a little more than a week before it is published, making it relatively current compared with many economic indicators, which can have a lag of a month or more.

In addition, the book is published two weeks before the Fed’s Open Market Committee meets to determine whether to alter its target interest rate. So economists check the book for any information that might push the Fed to either cut or raise rates.

Barclays’ Hanson wrote that Wednesday’s report makes it more likely the Fed will cut rates by up to a half-percentage point during its Oct. 28-29 meeting.

Q. What are the drawbacks to the book?

A. It doesn’t include new data and as a result usually doesn’t move markets.

Also, given the rapid changes taking place during the financial crisis, the latest book may already be somewhat dated. The regional banks stopped gathering information for the report Oct. 6, just before the stock markets experienced their worst weekly drop in history.

That was also before the Treasury Department’s announcement Tuesday that it would partially nationalize nine major banks.

The report “is looking in the rearview mirror more than it normally is,” said Carl Riccadonna, senior U.S. economist at Deutsche Bank. Riccadonna, speaking before the report’s release, said he thinks things have gotten even worse since it was compiled.

Q. Why is it called the “Beige Book”? Let me guess — it has something to do with the color of the cover?

A. Yes, or at least the Fed’s internal copies are beige. The copies released to news media and public have white covers.

The report had red covers and was known as the “red book” when it began in 1970 as an internal report for the Fed. But the color and the name changed with the report’s first public release in 1983.

Another reason people like to call it the Beige Book: The official title is “Summary of Commentary on Current Economic Conditions by Federal Reserve District.”