Who says the delusional American consumer is dead. They are just as delusional as ever. Their real disposable income fell in July, even using the fake government inflation figures. What do you do if your income declines? If you are a delusional American, you go buy a new car. Not only do you buy a new car, you finance it for seven years at 0%. Everyone knows that GMAC and Ford Credit won’t have any losses on those loans.
The Americans who didn’t buy cars just spent a lot more for gas and oil as prices surged in July.
So, a country that will need savings and investment to turn our economy around reduced savings dramatically. We have record government transfers and declining income, so consumers reduced their savings rate from 5.5% to 5.0%. This bodes well for our future. I’m sure the Wall Street shysters will somehow spin this as positive. Party on dude. Delusions die slowly.
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2 comments:
To buy a new car is beginning to sound good to me. Obama's presidency is beginning to put everybody into a funk. Might as well make yourself happy, if only temporarily, with a new car. We'll be helping the economy and giving ourself a lift at the same time.
Don't rush to buy that new car just yet. Obama just named the new(est) head of his economic team and the professor was the architect of the Cash For Clunker Program. No experience, just another religious follower of theory. Couple this with the fact that Obama's head of Job Recovery is the GE CEO that's moving a 115 year X-ray division from the US to China and investing $2b in China (did I mention that GE paid ZERO income tax in 2010? Now, none of the X-ray division workers will pay taxes). Getting back to the subject, the Obama Administration just may come up with a NEW clunker program that pays you to purchase a car manufactured in China or another foreign country.
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