Profit reports turn spotlight on consumer spending

[FreakinDJ]

Source: Mae Anderson, AP Business Writer

Profit reports turn spotlight on consumer spending

Earnings reports put spotlight on consumers and whether they're opening their wallets more

NEW YORK (AP) -- When the economy screeched to a halt late last year, so did consumer spending, which accounts for 70 percent of all U.S. economic activity. That's why the latest string of quarterly reports will be closely watched for any indication that consumers feel more confident about parting with their money.

Consumers curbed their spending to an unprecedented degree as they worried about declining home values, tight credit and unemployment. But recent data indicates the worst may be over. The government reported last month that consumer spending rose in February. It was the second month in a row spending rose, following half a year of declines.

Among the major companies reporting earnings, Visa Inc. and MasterCard Inc. will likely offer some insight into spending habits. VF Corp. is scheduled to report, too, providing some visibility into overall apparel sales.

Furthermore, next week is set to bring significant economic data, including first-quarter gross domestic product figures and consumer confidence estimates, giving an even better picture of the economy.



Read more: http://finance.yahoo.com/news/Profit-reports-turn-spotlight-apf-15033043.html?sec=topStories&pos=3&asset=&ccode=

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Proof is in the pudding - Obama's stimulus package is working

[ixion]

1. "the worst may be over"

Don't bet on it.

[CoffeeCat]

2. I wish we weren't hinging this recovery...

...on companies like Visa and Mastercard.

I'd love to see a recovery, but is it really a recovery if we're just looking for people to starting
spending like nimrods with credit-cards again?

Have we learned nothing from the excess and materialism of the past two decades?

Is the best we can hope for--a brand-new, stupidity-based bubble of people living beyond their means
and using their credit cards for frivolous purchases that they really can't afford?

I had such high hopes that we would see how ridiculous it all was--and that a smarter, more rational
economy would rise from the ashes.

[liberalmike27]

8. While I take your point

I think far too much discussion has focused on getting credit back up and running, and too little talk has aired about getting salaries of americans back up, so they can spend their actual money, rather than future money, plus interest.

Sadly, just like the last depression, this one was brought about by the rich getting too big a share of the wealth. I've heard that the top one percent have gone from 9% to 21% of all wealth in this nation in the last 20 years. Now that, is disgusting.

And this at the same time that 40 percent of us can't afford insurance, and there is a ten percent unemployment rate. When money becomes so concentrated into the hands of a few, it can't get spent by the many. All the arguments about "redistribution" are flawed, though they may seem feel-good, they simply cut down on the spending in the economy, which drives it by two-thirds, and eventually, you come to the place we are at now, too many people, with too few bucks.

[CoffeeCat]

11. I agree...

...that there is too much focus on getting us to borrow ourselves into more debt. As you said, no one is talking
about wages and how most households need two incomes to survive.

We have fewer dollars, and people tried to make up for their lagging salaries--by using credit cards. All we did
was enslave ourselves and give billions in interest to the credit-card companies.

Like you said, we're watching the concentration of wealth move up the chain and into fewer hands.

I look back at the last decade, and I see a massive scam. People who were talked into creative financing purchased homes.
Where are those people now? Either in those homes and hanging on for dear life; or foreclosed and in dire straights. Where
are the banks who pushed those irresponsible loans? They made money off those initial loans, then made more money when they
packaged up those loans into toxic assets and sold to the secondary market. And now...the cherry on the cake is that they
get trillions of OUR cash in the form of a bailout. It's...totally unbelievable.

Same with the credit card companies. They bilk us with 17 percent interest rates and $78-gotcha late fees. They now recognize
that the party is over. So they're cutting credit lines, canceling cards and raising interest rates--in my opinion, because they
don't want people holding their cards when pandemonium sets in and people start stockpiling and panicking.

All of this is very disconcerting.

I'm also concerned that the article in the original OP suggests that the economy is improving. Again, another ploy. They
want us to start spending again, and they twist statistics into silver linings. People were saving and spending responsibly, but
the MSM, together with their corporate partners in crime, are trying to goad them back into bad habits again.

Sorry, just emoting. I'm tired of watching this train wreck and feeling such outrage.

[Dr.Phool]

3. How can you call it proof, when you haven't seen the pudding yet?

Mastercard and Visa's profits couldn't be related to their increases in fees and interest rates, could they? And wouldn't that just remove more spending money from the real economy?

In the next few weeks, thousands of autoworkers are going to lose their jobs. Their suppliers are next.

Check out some of these charts.

http://www.financialsense.com/Market/wrapup.htm

[xchrom]

4. i work at a lower end furniture retailer --

april was slower than march. we did $200 grand in march.
we'll do -- $125 to $140 in april.

[BR_Parkway]

5. I thought the March numbers were worse than expected? Did the

writer just go pull some numbers from a month that supported her theory to write this?

And likely the only reason for the Feb bump were the folks spending their tax refund checks on things they'd put off until they got that extra cash

[Pharlo]

6. More relevant would be a breakdown on what

consumers were charging on Mastercard and VISA: necessities such as food or shelter; or wants/desires such as large screen tvs. Another factor would be tax returns being used to replace long term durable goods that were JUST holding out.

Hell, my car died in February. I live in rural WI, 40 miles from work. Another car was a necessity. So, I was forced to get another car. Doesn't mean I'm any more confident in the damn economy. Just means I needed a car and was forced to purchase one at that time.

[DeSwiss]

7. Right!

- K&R

[onethatcares]

9. Let's see, 6 million people out of work,

basically living on their unemployment benefits unless they put enough aside to tide them over for 12 months or so. First thing they'll want to do is run up a credit card bill at 28% interest to purchase a tv from China, keeping the Chinese economy moving.

This is what happens when a service economy is all you got.

Personally, I've pulled in my spending immensely, my truck sits in the driveway weekends and nights and nights out are now to walkable places. Thankfully, there was an insightful crew that has taken over a section of our town close enough to my home that we can hear live music and eat at many places without moving a vehicle or using bikes.

[lostnotforgotten]

10. Friday Evening To Sunday Morning - My Car Sits In The Driveway

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