|
Unfortunately, there is far more of this going on these days than many people would like to believe – a cartoon like this unheard of a decade or two ago – as the Great Recession looks more and more like a Little Depression everyday, taking a toll on every living generation.
From the Drew Sheneman archive at Tribune Media Services.
What’s not surprising about this CNBC poll is that more Americans are more pessimistic about the U.S. economy, but, what is surprising is how they’ve defined “wealthy”.
Nearly two-thirds of the nation (63 percent) is pessimistic about the current state of the economy and its future, with just 6 percent optimistic about both. The attitudes of wealthier Americans—those with incomes greater than $75,000 or more than $50,000 invested in the stock market—are now in line or even more downbeat than the nation as a whole.
Just 26 percent of Americans with incomes above $75,000 believe the economy will get better in the next year, four points below the national average. In December, it was five points above. For the first time in the survey’s five-year history less than half of those with $50,000 or more in stocks think it’s a good time to invest in the market.
Over the next year, most Americans think home prices will fall and wages will drop as they spend less, save less, and drive less while the number of these “wealthy” individuals using credit cards to help make ends meet almost doubled from 12 percent to 20 percent.
The Commerce Department reported that increasing consumer spending and rising inventories more than offset reduced spending by state and local governments and for national defense as the U.S. economy expanded at a seasonally adjusted annualized rate of just 1.8 percent, the weakest growth rate since the second quarter of 2010.
This was the “advance” estimate for economic activity from January to March, the first of three estimates for the period, to be followed by the “preliminary” estimate in late-May and the “final” reading a month later.
Add this to the growing list of data points foretelling a rough road ahead for stocks, last month’s 27-year high for the ISM Manufacturing Index apparently a sign of a top for equity markets as detailed in this Chart of the Day at Bloomberg
Along with the monthly labor report – where hopes are high that payroll gains will keep pace with the growth in the U.S. population for the second month in a row – the latest ISM data will be released tomorrow, a rare occurrence when these two important gauges of the U.S. economy are reported on the same day, possibly producing a little extra market volatility.
It should come as no surprise that the mid-month plunge in the Reuters/University of Michigan consumer sentiment index was confirmed in the final reading for March, this key gauge of the mood of the consumer in fact falling further, from 68.2 two weeks ago to 67.5 today. About the only good news here is that the early-month trend did not continue.
High and still rising gasoline prices are a real buzz-kill consumer spending-wise and respondents to this poll have increased their expectations for further price increases rapidly, the one-year outlook for inflation rising from 3.4 percent in February to 4.6 percent this month. As noted here earlier in the week, a Gallup survey showed a rapidly souring mood for many Americans and further confirmation of this untoward development will likely be provided next Tuesday when the Conference Board’s consumer confidence index is reported.
The Commerce Department reported that fourth quarter real economic growth in the U.S. slowed from an annual rate of 3.2 percent to 2.8 percent after broad-based downward revisions. This came as something of a surprise to analysts as consensus estimates were for upward revisions to about a 3.4 percent rate.
Both government spending and consumer spending were lower than previously thought, government outlays falling at a 1.5 percent rate rather than 0.6 percent and consumer spending increasing at a rate of 4.1 percent rather than 4.4 percent.
By Tim Iacono, Since 2005
![[Most Recent USD from www.kitco.com]](http://www.weblinks247.com/indexes/idx24_usd_en_2.gif)
Recent Comments