Based on the latest data (reported earlier today), the rate of growth in year-on-year personal income has fallen below that of personal spending, with the ratio of the former to the latter hitting its lowest level since June 2010.
Simply put, unless household income is poised for an imminent jump -- which would seem to require a significant and sustained boost in new hiring in the absense of any "quick fix" stimulus programs -- this development suggests that the already languid pace of consumer spending (especially when viewed in real, or inflation-adjusted, terms) is set to be dragged even lower.
Of course, details like this don't really matter to equity traders, who've been buying shares in the consumer discretionary sector like there's no tomorrow.
(after your last sentence)
Which shortly thereafter drives the ranks of the unemployed higher by making prices of necessities artificially higher (due to speculator greed) causing people to cut back, causing the company to lay off . . . .the death spiral continues apace and we aren't hearing much of the real news (that matters).
This is what empire collapse feels like. More and more people falling into the abyss of poverty, desperation, break-down. There's little to no "community" or shared burdens/solutions. We're all "individuals" - no hive mentality or group mind. Haven't we evolved at all as a species? Or did our little adventure (of a few millenia) of hubris cause us to finally realize what we've done, and failed to do (as we'll all come to realize at our respective ends)?
Too late? Can we start now? Would the realization come in time to avert damage by living so as to heal and sustain our environment? (Among the many components of this "realization" is that a drastic reduction in population is bound to occur no matter how soon we act, at this point). Still, do we try?
When do we decide to act?
Posted by: Tom | March 02, 2012 at 08:56 AM
Household income is poised for permanent decline,
a natural in the system. The intense global
competition mandates lower wages in the western
industrial country's.
2: The mother of all crisis, depletion of world
resources ,especially cheap energy,is on the
horizon.Not living witting the confine of
natures laws is a guaranty of extinction.
We cannot build/manufacture without destroying,
is the stuff we make for profit more important
than preserving our base for life?
Posted by: roger | March 02, 2012 at 02:42 PM
Inflation is higher than we are led to believe. In our neighborhood super market, the $50 grocery now costs about $75.
Posted by: Doable Finance | March 07, 2012 at 07:00 PM