Reports of the death of the American consumer are greatly exaggerated
This article written in the Economist's online news print, refutes the claim that Americans are consuming a lot less then they have in previous years. It also discusses how low prices of oil does not directly correlate to consumers spending more on other goods. It general it appears the the American economy as a whole is showing healthy spending and saving habits relative to previous times in history. The 2007-08 financial crisis may have been a catalyst in consumers being less risky with their finances and not spending more than they have. Another positive sign is that average household debt has been falling and may continue to do so. In addition, low interest rates have helped to reduce the amount of debt people have. To read full article click below.
I agree with the notion that the American Consumer has not lost its normal spending habits. There have been far too many articles claiming that another recession is imminent in the near future, but I think these are all too premature and unnecessary. It's no shock that our rise from the recession hasn't been as spectacular as we would've hoped but for now our economy is stable, which is impressive given the current happenings around the rest of the globe. We were flying high prior to 2008 with millions of households being able to afford (at least for a little while) their first homes. Consumer confidence was high and we thought we could spend forever. However, since then, there has been an uptick in the notion that it's ok not to spend, spend, spend and I think that is still what we are seeing now.
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