Retail Sales In Surprise Swoon

Inflation cooling, but consumer confidence is down

(NEWSER) - Personal spending—a major force in the health of the economy— rose just 0.1% in February, its smallest increase in 16 months, the Wall Street Journal reports. The increase, which actually beat analysts' estimate of a 0.1% decrease, came despite a bump in personal income and signs that inflation is easing, the Journal notes. More»

(NEWSER) - November’s retail sales confounded doomsayers, surging 1.2%, twice the 0.6% analysts predicted, Bloomberg reports. Many had worried that consumer spending would take a hit as gas rose and housing fell, but now it looks like job and income growth could cushion the fall. “The numbers should help put to rest some of the fears of sliding into recession,” said one economist. More»

Despite record growth, Wall Street has plenty of cause for concern, Business Week says

(NEWSER) - Wall Street is giddy with low unemployment, optimistic earnings predictions, and a resilient economy, but BusinessWeek lists five things for investors to worry about.

1. Volatility in earnings, especially tech companies
2. Consumer spending, as gas prices take their toll
3. Inflation, which could prompt the fed to raise interest rates
4. Subprime aftereffects, as the panic spreads to other forms of debt
5. Too much optimism, as it starts to look like irrational exhuberance

Consumers shrug off unemployment, pessimism, and spend

(NEWSER) - Holiday shoppers put their economic fears on layaway on Friday, and instead bought and charged their way to a record huge Black Friday, reports Bloomberg . With $11.4 billion spent at retail stores and malls on Friday, spending was up 6.6% from last year, the biggest one-year gain since 2007. “A solid Black Friday suggests the rest of the season should be pretty good,” said one retail expert. “Those who have jobs have been willing to spend.” More»

Personal income up 0.3%, but inflation hits hard

(NEWSER) - Consumer spending rose at its fastest rate in four months in February—but that’s in large part due to rising gas prices. Consumer spending climbed 0.7%, while personal income rose 0.3% following January’s 1.2% jump, the AP notes. Both gains reflected a Social Security tax cut, which boosted take-home pay. But if energy prices keep climbing, household budgets will fall, and so will spending, economists say. More»