Why has the US economy consumer spending climbed on cash for clunkers?”
Consumer spending in the U.S. rose in July as Americans jammed auto showrooms to take advantage of the “cash for clunkers” program while avoiding other purchases. The 0.2 percent gain in spending was in line with forecasts and followed a 0.6 percent increase in June, the Commerce Department said today in Washington. Excluding cars, purchases were flat. Consumer sentiment was little changed in August, a separate report showed. Auto dealers benefited from the Obama administration’s incentive plan, which ended this month, while retailers such as Kohl’s Corp. and J.C. Penney Co. struggled to lure customers shaken by mounting job losses. Spending gains aren’t likely to be sustained as incomes stagnate and households pay down debt, casting doubt on the strength of the economic recovery. “The cash-for-clunkers program helped auto sales but hurt other sales, which shows consumption remains weak,” said Christopher Low, chief economist at FTN Financial in New York. “Consumers don’t want to spend
Consumer spending in the U.S. rose in July as Americans jammed auto showrooms to take advantage of the “cash for clunkers” program while avoiding other purchases. The 0.2 percent gain in spending was in line with forecasts and followed a 0.6 percent increase in June, the Commerce Department said today in Washington. Excluding cars, purchases were flat. Consumer sentiment was little changed in August, a separate report showed. Auto dealers benefited from the Obama administration’s incentive plan, which ended this month, while retailers such as Kohl’s Corp. and J.C. Penney Co. struggled to lure customers shaken by mounting job losses. Spending gains aren’t likely to be sustained as incomes stagnate and households pay down debt, casting doubt on the strength of the economic recovery. “The cash-for-clunkers program helped auto sales but hurt other sales, which shows consumption remains weak,” said Christopher Low, chief economist at FTN Financial in New York. “Consumers don’t want to spend
