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Americans Cut Back Sharply on Spending
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Issue
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| Contributor | Servo |
| Last Edited | Servo Jan 14, 2008 12:42pm |
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| Category | News |
| Media | Newspaper - New York Times |
| News Date | Monday, January 14, 2008 06:00:00 PM UTC0:0 |
| Description | Strong evidence is emerging that consumer spending, a bulwark against recession over the last year even as energy prices surged and the housing market sputtered, has begun to slow sharply at every level of the American economy, from the working class to the wealthy.
The abrupt pullback raises the possibility that the country may be experiencing a rare decline in personal consumption, not just a slower rate of growth. Such a decline would be the first since 1991, and it would almost certainly push the entire economy into a recession in the middle of an election year.
There are mounting anecdotal signs that beginning in December Americans cut back significantly on personal consumption, which accounts for 70 percent of the economy.
A raft of consumer companies — high-end stores like Nordstrom and Tiffany, and middle-of-the-road ones like Target and J. C. Penney — reported a pronounced slowdown in growth last month, and in several cases an outright drop in business. |
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