Tuesday, March 30, 2010
Personal spending rises in February
This article is about how consumer spending is still rising slowly, even though it is quickly outpacing the growth in income. This means that savings is decreasing. From the solow model we would assume that the US economy is above the steady-state.
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This is an excellent sign for recovery that personal spending is starting to increase. Even though consumers' income has remained unchanged, these people are thinking that things will get better and spending as if they are. This is a great example of what people expect will happen.
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