back to Today's Commentary
Spending Spree Will Run Out Of Gas
-- August 30, 2002
Consumers may have taken advantage of low- or no-interest car deals, but those deals are coming to an end and so will this spending spree. General Motors, whose sales grew the most in July, has already announced that it will terminate its incentives packages at the end of August. Without these deals, consumers will likely slam on the brakes.
Consumers watched their salaries stagnate in July, and, as a result, have pared back their spending this month. They're not making more money so they can't justify new purchases. Sales of back-to-school merchandise, for example, have fallen flat for retailers. And it won't take long before major purchases such as autos, furniture, appliances, and houses, follow suit.
U.S. July Personal Spending Up 1%; Incomes Unchanged