Shortlived enthusiasm from econonomists and consumers alike.
Consumer spending sank 0.5% in September -- the largest drop in nine months -- reflecting the end of the clunkers program and continued strain in the labor and credit markets.The data, which were in line with economists' forecasts, come a day after the government estimated that gross domestic product rose 3.5% in the third quarter, largely on the back of consumer spending.
While the report raises questions about whether consumers can drive the economic recovery, increases in spending outside of the auto sector offer signs of stability.Personal incomes for September, meanwhile, were unchanged.
I am encouraged that spending outside of the auto sector offers signs of stability, but it does seem like most of the slight economic growth that we have been experiencing, despite conservative objections, may actually be attributed to all of the capital that has been invested in "jump starting" a failing economy.
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