A new report issued by the Commerce Department has shown that average consumer spending fell in September for the first time in five months, a development that has been attributed to the ending of the Cash for Clunkers automotive rebate program. This drop in consumer spending matching analyst estimates and follows a 1.4 percent jump in the previous month.
Consumer confidence has taken a hit in recent months because of stagnant wages and growing unemployment, two factors that have raised worries that consumers will cut back spending in the coming months.
Analysts also worry that consumers will grow reliant on government programs, …read more

Are we changing our spending habits?

Perhaps it’s not fair to judge him on something that, really, no president has much control over. But Obama appears to be making plans and laying the groundwork for (potential) economic recovery.

Most of the 5 million people working part time are doing so because their hours have been cut from full time.

I was asked about what I think about the economic stimulus plan that Barack Obama laid out in his weekly address over the weekend.

Despite the fact that many consumers are cutting back on holiday spending, it is still likely that a credit card Christmas still comes into play for many. And if you are already in debt, that can be a problem. Peter Pham, the CEO of BillShrink.com, points out that the average American household already has $8,300 in credit card debt. “Add Christmas shopping to that, and you get a pile-up of interest charges and fees. You have to be careful.”
Pham’s company aims to help consumers do just that: Be careful. “When you already have debt, and you decide to use a …read more

I admit it: I did go out yesterday. But (hear the self-justifying note in my voice) it was only because my parents were down for Thanksgiving and my mom wanted to have some mother-daughter bonding and get presents for my dad at the same time. I only spent $25 on presents for a less-fortunate family whose kids my mom teaches in rural Idaho. Besides, we missed the fanatics by only going to a couple of stores between 8 and 11 a.m. Before this year, I’ve only been out on Black Friday once in my life, years and years ago.
That was …read more

Almost two weeks ago, I posted a news package from NPR in which I was heard talking about fixing the economy. One of the major points of the interview — although it didn’t make a significant appearance in the news package — was that as long as we have an economy that is based on continued consumerism fueled by debt (mostly credit card debt), we will have a relatively unstable economy in which explosive growth is expected, but unsustainable, over the long run.
Indeed, everything our leaders have been doing, in the name of fixing the economy, has been aimed at …read more

Last week, I mentioned that consumer spending on luxury goods is down. What I didn’t really think about at the time is how organic foods might be a luxury item.
The thought that luxury spending might extend to such things as organic food occurred to me yesterday when I got an email from the local organic market explaining that the store was closing later this month. Since I live in a small town in the middle of nowhere, this is a blow to me. We don’t have chain organic stores. Sometimes the other grocery stores have a few items, but there …read more

Americans are finally slowing down in the consumer spending department. The Wall Street Journal reported that luxury sales dropped 20% in October. But that’s not all; other types of consumer goods aren’t being bought at staggering rates, either. There really is a recession diet out there. Here are some of the other categories of consumer spending see a drop:

Furniture
Electronics
Appliances
Clothing (men and women)
Footwear

It appears that the economic slowdown is really affecting spending right now. For the most part, we’ve mostly cut back on eating out and we’ve decided to spend less on gifts for each other this year. And our impulse …read more