Not exactly true. Even with an unemployment rate of 10%, 90% of the labor force is employed, and that 90% - especially its richer half - has gone from pinching pennies to spending more. And it's coming out of current income, and maybe savings, but not credit. So far.
Doug
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Okay. But a couple of points. It would help to know how much of the consumer spending is coming from the richer and much smaller percent. See I suspect the inequality has gotten so large that it can skew an average enough to make it look like the bigger `we' are doing okay. My other worry is that the austerity packages for the states and cities hasn't taken effect yet, but when they do, it won't just cause `pain', they will force the economy into a real depression.
Personally I am heading into the toilet soon... I feel like the miner's canary. When I go belly up, a lot of other people will too. I am in the process of cutting everything that isn't absolutely essential. That's what the e-mail address change was all about, getting the lowest rate I could find, etc.
So, anyway, what about the rest of the Whitney articles? When you get a chance, read through and see.
I'd like to hear Doug and other evaluation on the predictive claims that we are headed into another big crash, the current stock market levels represent a bubble and not a recovery, that the Greeks are dead meat if they don't get out of the EU, that the EU bailout won't work for very long, that Club Med (Portugal, Spain, Italy) are headed in the same downward spiral. That, the EU crashes will come back to the US and start hitting the finance sector were GS is currently making `perfect' quarter profits, and the rest are doing just fine.
CG