Consumer spending outlook for 2012: 'Tepid'

Considering that consumer spending represents about 70% of the economy, this isn't good news. New York Times: As the weak economy has trudged on, they have leaned on credit cards to pay for holiday gifts, many bought at discounts. They are dipping into savings to cover spikes in gas, food and rent. They are substituting domestic vacations for international trips, squeezing more life out of their washing machines and refrigerators and switching to alternatives as meat prices have risen. That leaves little room for a big increase in spending in 2012, economists say, a shaky foundation for the most important pillar of the American economy. "The consumer is far from healthy," said Steve Blitz, senior economist for ITG Investment Research. Even the seemingly robust holiday shopping season is raising concern. After a strong start on Thanksgiving weekend, a pronounced lull followed, causing retailers to mark down products heavily in the week before Christmas. While final numbers for the...(Read Full Post)