This Picture Tells *the* Story

More news from the front lines of the V-shaped recovery...

Although its been said that every picture tells a story, I reckon the image highlighted by Modeled Behavior in "Still Trying to Locate those Personal Consumption Expenditures," tells the story about the alleged good health of the American consumer:

I’m guessing they’re buried in Health Care and Education because it doesn’t look like they’re in retail sales. See what I mean:

Up until right before the crash the two tracked each other well. However, at the peak of the housing bubble, when Americans were supposed to be blowing all their money on Plasma TVs and nights out at the Olive Garden, retail sales growth was actually slowing down while Personal Consumption Expenditure continued growing, unabated.

To date Retail Sales have not yet recovered. However PCE is on a tear, breaking through the old peak and setting new highs. What gives?

Comments

[nevket240]

The retail sector was bailed out as well as the banks.
With a Govt. cheque in hand, mortgage payments not being made and agressive discounting who wouldn't spend while the going was "good".
regards

[Sandy]

I think it proves that Americans are aware of what the White House is doing and they are preparing for a crash coming. This is a good thing........ A year or so ago it would have been a major disaster, but now more people will make it through.

[spinone]

Americans will continue consuming until their credit cards are cancelled.

[Elf]

Well if PCE include petrol, firearms, ammunition, hard money I have an answer. Also if they are dealing in cash.

Or it's just the last days of Rome mad orgy of consumerism.

[nika]

Is it that people are paying more and more for healthcare premiums? Is it that the healthcare industry is stepping up their aggressive pocket-raping before many of us middle class completely and finally fall through the cracks?

[nonpartisan]

Americans want their bread and circuses!!

[Rocky]

Nika: Health insurance premiums are the fastest growing item in my budget and they have crowded out a lot of impulse buying and travel. I am hoping things get better when I qualify for Medicare in a few years but who knows? In the meantime I am bracing for another double digit increase in premium costs starting next January. Obamacare will do nothing for me, as far as I can tell.

[Do something!]

If your too lazy to call then email them.

Fed Privately Lobbies Congress to Kill Audit; What You Can Do!

http://tinyurl.com/36x3a2o

[Marion Shaw]

I know one thing first hand re:a federal pensioner if one qualifies for the three percent cost of living increase. However.anyone employed after 1984 doesn't get that benefit.
About five years ago the OPM would send
the increase in January, and then send a notice that
an adjustment had been made in Feb. Half of the increase is applied to the federal health plan.

There is now a built in premise that the medical benefits will increase yearly. I don't believe that was the original intent. It would appear that in short
order, the same math is going to apply to universal health care coverage to be managed by the government. They are going to get their universal pound of flesh one way or the other and if you are not a federal
retiree, the yearly increse will come from the bottom
of everyone's pocket, not half of the cost of living
adjustment for the federal retirees which amounts
to a V shaped recovery alright, but the V stands for
virtual reality.

[Small Town Gal]

Retail and food are discretionary. Well, some food isn't - but you can radically cut your food budget if you simply never eat outside the house and brown bag all your lunches.

Insurance, gas, utilities - those are not discretionary. There is only so much that you can cut. And all of them have been skyrocketing. You have kids, then you have people who continually need shoes and clothes; otherwise, I've not bought anything that we didn't have to have for over a year. We don't have the money to spend.

Now: we did get a new car battery, some tires, and some dental care from the tax refund. So our PCE are probably up!

[RobertSahw]

Does the PCE include gas and food? If so, then I think it's just price inflation. And it's also tax refund time. More money to blow at Best Buy. That would be my guess.

[Russ]

off topic but we need to act now...

We need accountability...

Monday, May 3, 2010
Turning the Tide on Lawcap and Fincap

http://inpoints.blogspot.com/2010/05/turning-tide-on-lawcap-and-fincap.html

[sadie]

That's why I love America!

[Sean]

Could it be that all the folks not paying their mortgages are 'living it up'? Plus lots of tax credits?