U.S. Consumer Spending Jumps the Most Since '01 in Sign Economy Rebounding

[Purveyor]

Source: Bloomberg

By Shobhana Chandra

Oct. 1 (Bloomberg) -- Spending by U.S. consumers climbed in August by the most since 2001, indicating the biggest part of the economy is starting to rebound from its worst slump in almost three decades.

The 1.3 percent increase in purchases was larger than forecast and followed a 0.3 percent gain in the prior month that was bigger than previously estimated, Commerce Department figures showed today in Washington. Incomes climbed 0.2 percent for a second month and inflation decelerated.

Automakers including General Motors Co. benefited from the Obama administration’s $3 billion “cash-for-clunkers” incentives. A projected drop in auto purchases last month is a reminder that such gains will be hard to sustain as the stimulus programs expire and households grapple with rising joblessness and stagnant incomes.

“This is not just a cash-for-clunkers story, spending is back in other areas as well,” said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, who correctly forecast the gain in spending. “It looks to be a slow and steady recovery. The labor market is key for whether or not the consumer will continue to spend into the fourth quarter.”

A report from the Labor Department showed the number of Americans filing first-time claims for jobless benefits rose more than forecast last week, a sign companies are still cutting workers as the economy pulls out of the recession. Applications rose by 17,000 to 551,000 in the week ended Sept. 26.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=aSbaO.gu.aps

[notadmblnd]

1. That would be me.. single handed too I'll bet

car repairs up the hiney these days. Savings are being depleted quicker than I thought. Oh well, better now than when it's 20 below

[nebenaube]

3. That's all it is

Just people getting ready for winter...

[nebenaube]

2. Yeah... right!

[earthside]

4. Wait a minute...

A very different picture painted in the New York Times:

U.S. Consumer Spending Jumps; Jobless Claims Up

A fusillade of economic reports released Thursday showed the economy’s rebound off the bottom seems to be leveling off, and that any recovery may come in fits and starts for the rest of the year.

Some figures, like an increase in construction spending and the number of home sales under contract, do suggest continuing growth. But a rise in first-time unemployment claims and an unexpected drop in manufacturing activity showed that some forecasters’ expectations may be too optimistic.

“We don’t think we’re going to come out of this unscathed and be back to business as usual,” said Scott Anderson, senior economist at Wells Fargo. “Consumers will continue to be suffering from the headwinds of the financial crisis. Debt levels remain too high.”

Consumer spending, which makes up 70 percent of the economy, rose sharply in August as car buyers took advantage of taxpayer-financed rebates under the government’s “cash for clunkers” program, the Commerce Department reported.

But while the 1.3 percent spike in spending was the largest in nearly eight years, economists said it was not the foundation for any long-term rebound in the consumer sector. The government’s $3 billion clunkers program has ended, and automakers are bracing for a drop in September sales from a month earlier. ...

... The personal savings rate dipped to 3 percent from as high as 5.9 percent in May as consumers spent more of their disposable income, most likely on new cars and trucks.

[WriteDown]

5. Jobless claims rise; Americans' spending jumps

Source: AP


WASHINGTON – First-time claims for jobless benefits increased more than expected last week, a sign employers are reluctant to hire and the job market remains weak.

And while consumer spending jumped by the most in nearly eight years in August due partly to the government's Cash for Clunkers program, economists worry whether that rebound can be sustained with U.S. households facing rising unemployment, tight credit conditions and other obstacles.

The Labor Department said Thursday that initial claims for unemployment insurance rose to a seasonally adjusted 551,000 from 534,000 in the previous week. Wall Street economists expected an increase of 5,000, according to a survey by Thomson Reuters.

The increase comes after three weeks of declines. Weekly claims have been trending down since the spring, but the decline has been painfully slow. The four-week average, which smooths out fluctuations, dropped to 548,000, about 110,000 below its peak in early April.

Economists closely watch initial claims, which are considered a gauge of layoffs and an indication of companies' willingness to hire new workers. Many economists say initial claims below 400,000 would be a signal that employers are adding to the net total of jobs.....

Read more: http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/100209dnbuseconomy.b58b42.html

---

Time for Cash for Clunkers 2.

[rantormusing]

6. im curious to see how this will be spun

Everyone is so desperate to say we survived the turn, but It's just team cheering, like only scoring three points in a football game while being behind by 40. I'll admit to bring pessimistic, but the burden is on obama to prove he isn't trying to hype up the economy in order to move on and forget.

[demigoddess]

7. don't believe it, everyone i know is tightening their belts. Stores are

taking things off their shelves and clearance tables are all over the place and growing.

[madaboutharry]

8. delete

[Arkana]

9. I gotta stop buying video games.

[HCE SuiGeneris]

10. More BS from our propagandists.

GO SHOPPING! :puke:

[skoalyman]

11. recovery may come in fits and starts for the rest of the year

sound serious if there having fits and starts:freak: :hurts: :spray:
whats next convulsions,comas:boring: :shrug:

[Grinchie]

12. Ha Ha Ha. The Propagandists are too funny!

Just wait till all the Truck drivers, harvestor operators, and farmers shut down for the season in California... Thats when the real numbers will again rise.

School has started, and all the little kiddies have their books, pencils, and spiderman lunchboxes in hand..

Libraries are being closed right and left, and the state of California has shut down all of their rest areas, so the Truckers and other travelers get to defecate on the side of the road.

Yep, good times in California, if you are a fan of Steinbeck and the Grapes of Wrath.

[Old Hob]

13. back to school shopping will do that. nt