November 13, 2008 Consumer Confidence
So where are we at with the latest confidence crisis? Well according to today NY Times the numbers for consumer spending are pretty alarming.
Sales of new vehicles have dropped 32 percent in the third quarter. Consumer spending appears likely to fall next year for the first time since 1980 and perhaps by the largest amount since 1942.
Circuit City has filed for bankruptcy and General Motors continues to struggle. Many clothing retailers are struggling too (Harold’s clothing, Mervyns, all going out of business recently). The challenge for consumer spending is in recent years the American consumer has spent 99% of their income…now American’s are looking to save more. Economists seem to be forecasting that saving will increase to around 3%. The trend of consumer spending of couse is something we will monitor closely in the next few months.
You can read the full article here: Buying Binge Slams to Halt