Since our economy is 70% derived from what the consumer does, the monthly reports on their habits is always enlightening. Many watch the consumer confidence numbers but I find that they tend to not actually follow what the consumer ‘does’ but rather what they ’feel’ at the time the survey was taken.
This week for September the Personal Income Report showed a steady but slightly weaker number, it rose .3%. For spending, it came in up .2% the same as it was in September. Income and spending has gone up for months but it is losing steam.
As long as the consumer is working, the economy should stay positive with a growing GDP. The report for the third quarter that came in this week showed a 1.9% growth rate; slightly weaker than the second quarter. Still there are no signs of a recession other than in the manufacturing sector. Maybe, we will avoid a general recession as the Fed has started another QE program to try and avoid it.