Jan 04 2012

70% of the Economy

Green Shoots.

And read the URL, not the Headline.

For 2012, Signs Point to Tepid Consumer Spending

By MOTOKO RICH and STEPHANIE CLIFFORD, The New York Times

Published: January 2, 2012

Even the seemingly robust holiday shopping season is raising concern. After a strong start on Thanksgiving weekend, a pronounced lull followed, causing retailers to mark down products heavily in the week before Christmas. While final numbers for the season are not in, analysts say they are worried that retailers had to eat into profits to generate high revenues.

…

Even some growth areas in the economy can be explained by tapped-out consumers. Take auto sales, which rose about 10 percent nationwide in 2011 from a year earlier.

“People can only hold onto their cars for so long,” said Romolo Debottis, new-car sales manager at Mike Bass Ford in Sheffield Village, a suburb of Cleveland. He said sales at the dealership should increase this year to 2007 levels, the prerecession peak. “A lot of them have done that above and beyond what they normally would, and they’re just ready to spend money and buy a new vehicle.”

Chrysler, Ford and General Motors report December vehicle sales

by CalculatedRisk

1/04/2012 10:25:00 AM

The key number for the economy is the seasonally adjusted annual sales rate (SAAR) compared to the last few months, not the year-over-year comparison provided by the automakers. Once all the reports are released, I’ll post a graph of the estimated total December light vehicle sales (SAAR) – usually around 4 PM ET.

…

The consensus is for sales to be unchanged from November at around 13.6 million SAAR.

rustymancuso581

3 comments

  2. http://www.nytimes.com/2012/01/03/business/for-2012-signs-point-to-retreat-in-consumer-spending.html?_r=1&ref=business

  3. As the weak economy has trudged on, they have leaned on credit cards to pay for holiday gifts, many bought at discounts. They are dipping into savings to cover spikes in gas, food and rent. They are substituting domestic vacations for international trips, squeezing more life out of their washing machines and refrigerators and switching to alternatives as meat prices have risen.

    That leaves little room for a big increase in spending in 2012, economists say, a shaky foundation for the most important pillar of the American economy.

    The payroll tax cut, if your employer “provides” healthcare insurance, will equal your insurance premium increase and out-of-pocket costs, so you will still have NO money to “extra” money to spend for shopping, eating out, movies, shows, whatnot.

    It’s a never-ending spiral and they are either too stupid or too complicit to do something about it.  Obama and the pols, that is.

    No one could have ever predicted that spending would be decreased in 2012.

    After all, if you’re lucky, after the payroll tax cut equals the healthcare insurance increase, and your home heating/electric bills increase, grocery cost increases, property taxes increase, sure…. we’ll have plenty of money to spend in 2012, probably paying lawyers to file bankruptcy for us.  (The last part of that sentence was a bit of hyperbole/sarcasm, but not entirely)

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