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Even Fat Wallets Closing

Nation's wealthiest aren't spending, signaling steep economic trouble

By Jim O'Neill, Newser User

Posted Nov 25, 2007 12:34 PM CST

(Newser) – Wealthy consumers, the 20% of the population responsible for nearly 40% of consumer spending, are closing their wallets, indicating an even rougher economic road ahead, reports Bloomberg. “When they begin to capitulate, that’s when we all head down,” said one economist. Blame deflating real estate prices and a sagging stock market for the lowest consumer confidence rating since 2004.

High-end retailers report sales growth plunged to 3.3% after running at 10% earlier this year. Even iconic retailer Nordstrom’s showed a decline on October sales. “The perfect storm is coming at the absolute wrong time,'' said one analyst. Economists predict consumer-spending growth will slip from a 3% annual rate to 2% in the fourth quarter, deepening the economic slump.

Best Buy flat screen monitors on display at a Best Buy store in Mountain View, Calif. (Associated Press)

Pedestrians on Michigan Ave. are reflected in the window of the Burberry store in Chicago. (Associated Press)

The nation's wealthiest 20% accounts for 40% of its spending, so when the rich close their wallets it signals deep trouble for the economy. (KRT Photos)

Shoppers look over shoes at a Kenneth Cole New York store in Santa Monica, Calif. (Associated Press)

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Even Fat Wallets Closing

Nation's wealthiest aren't spending, signaling steep economic trouble

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Consumer Spending Stalls Again

Confidence is falling as inflation rises

Next 12 Months: No Recession, but Slow Growth

Risk of recession at 26%; unemployment likely 9% at year's end

Recession Worse Than Thought; GDP Growth Weak

Economy grew just 1.3% over past three months

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CEO says customers 'running out of money'

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Even Fat Wallets Closing

Nation's wealthiest aren't spending, signaling steep economic trouble

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OTHER STORIES ON OUR RADAR

consumer confidence • consumer spending • US economy

MOST POPULAR STORIES

[ By Views ]

[ By Comments ]

More Newser Stories

Consumer Spending Stalls Again

Confidence is falling as inflation rises

Next 12 Months: No Recession, but Slow Growth

Risk of recession at 26%; unemployment likely 9% at year's end

Recession Worse Than Thought; GDP Growth Weak

Economy grew just 1.3% over past three months

Walmart: Gas Prices Hurting Our Shoppers

CEO says customers 'running out of money'

Economy Grew at 3.2% Rate in Q4

Consumer spending grew at fastest pace in 5 years

About Us

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Newser By Users

Community

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More News

What is Newser?