All Commentary
Monday, August 15, 2011

Consumers Not Expected to Take Fed Bait


“The Federal Reserve’s announcement last week that it intended to keep credit cheap for at least two more years was a clear invitation to Americans: Go out and borrow. But many economists say it will take more than low interest rates to persuade consumers, a crucial driver of the nation’s economy, to take on more debt. There are already signs that the recent stock market upheaval, turbulence in Europe and gridlock in Washington over the federal deficit have spooked consumers.” (New York Times)

We can’t spend our way out of this.

FEE Timely Classic
“Consumer Spending Doesn’t Drive the Economy” by Mark Skousen