Consumer confidence falls to 9-month low is subtitled 'Americans more worried about economy, job prospects.' Here's the story:
"Consumer confidence fell to a nine-month low in August as Americans grew more worried about the economy and the chances of finding a job, according to a survey released Tuesday.
The Conference Board said its confidence index dropped to 60.6 last month from 65.4, marking the lowest level since November. . . .
Lynn Franco, director of economic indicators, said “consumers were more apprehensive about business and employment prospects.”. . .
The decline in confidence coincides with a series of economic indicators that indicate U.S. growth slowed over the spring and summer.
More anxiety among Americans also suggests growth might not pick up anytime soon. Consumer spending accounts for as much as 70% of U.S. economic activity, but people tend to spend less when they are worried about the future.
Less consumer spending, in turn, deters businesses from hiring and investing as demand for their goods and services decline. The lack of hiring has kept the nation’s unemployment rate above 8% for 42 straight months, shackling the economy to below-average growth.
Economists were surprised by the decline in light of somewhat stronger hiring and retail spending in July. They suggest that concerns about the presidential election and so-called fiscal cliff may be making consumers more nervous. Deep spending cuts and higher taxes are set to kick in on Jan. 1 unless Washington acts to rescind current law.
The threat of the fiscal cliff has prompted some business leaders to warn that they may delay major projects or freeze hiring plans until they know whether U.S. lawmakers will reach a compromise.
“This will keep consumers on edge and the economic growth sluggish,” economists at Bank of America/Merrill Lynch said in a note.
The board’s future expectations sub-index sank to 70.7 last month from 78.4, while the present-conditions index was basically unchanged at 45.8.
Yet while consumers are less hopeful about the future, they say they’ve seen little deterioration recently in the economy, either."
People are worried about the future and should be.
If we keep government growing at the expense of encouraging private sector investments, trillion dollar deficits and an ever expanding national debt will be the result.
So will our politicians ever start acting like they work for We the People?
My answer is a qualified yes, but don't look for any serious business to be conducted until after November's elections.
Of course, there's no guarantee the political dysfunctionals will become functional even then.
But that's the best we can hope for, at least as I see things.