Relevant and even prescient commentary on news, politics and the economy.

Real income continued to fall in June, while consumers dug deeper to spend

Real income continued to fall in June, while consumers dug deeper to spend  – by New Deal democrat In June personal income rose 0.6% nominally, and nominal spending rose 1.1%. The personal consumption deflator, i.e., the relevant measure of inflation, clocked in at 1.0%, meaning real income fell -0.4%, while real personal spending rose 0.1%. […]

Households are getting much more overextended

Real income and – especially – spending increase in April, but households are getting much more overextended by NewDealdemocrat In April nominal personal income rose 0.4%, and spending rose 0.9%. March’s spending was revised up from 1.1% to 1.4%. In more good news, the personal consumption deflator, i.e., the relevant measure of inflation, rose only 0.2%, […]

Consumers still spend, real income declines, leaving them vulnerable to price shocks

Consumers still spend, but real income declines, leaving them increasingly vulnerable to price shocks Nominal personal income was unchanged in January, while spending rose 2.1%. In real terms after inflation, personal income declined -0.5%, and personal consumption expenditures rose 1.5%, completely reversing December’s decline, and adding about 0.2%. I have stopped comparing them with their […]

Real spending increases, real income declines in August

Real spending increases, real income declines in August (Note: I’ll report separately on construction spending and the ISM manufacturing index later.) Real personal income and spending held up well throughout the pandemic, due to a vigorous government response. This morning these were reported for the last full month of any assistance. In nominal terms, personal income […]

Not quite enough to start a “double-dip” recession

Real personal spending declines in December, while income rises; not quite enough to start a “double-dip” recession This morning’s report on personal income and spending for December reversed the pattern we have seen all during the second half of 2020. After rebounding strongly for 6 months, real personal spending (blue in the graph below) declined […]