Not This Time

摘要

Bad news: the most resilient and powerful economic force-the spending power of U.S. consumers-is beginning to falter. There are clear signs that their 17-year shopping spree that helped bring prosperity worldwide is coming to an end.rnIn the past, whenever markets have faltered, American shoppers have come to the rescue, spreading around prodigious amounts of cash so that businesses can grow and hire again. Consumer spending accounts for three-quarters of the $14 trillion U.S. economy. But this time spendthrift Americans, reeling from multiple blows, may not be able to come to the rescue. Their homes are still falling in value; stock market volatility has set everyone on edge; cash-out refinancing has nearly disappeared; and credit from other sources will soon run dry. People are losing their jobs. Personal debt (mortgage and other) hovers at 100% of annual GDP. Even if people wanted to spend it's harder than ever to do so. Says former Bear Stearns economist Conrad DeQuadros, now at consultancy RDQ Economics: "The greatest pain is yet to come."