Taking a cue from slight upticks in the national economy, Americans are braving the damp November weather to go shopping more than at any time since last June. The FT reports:
Opinion about current conditions ticked up to 76.6 from 75.1, while the gauge of expectations for the next six months jumped to 56.2 from 51.8. Both measures were also at their highest level in seven months.“The modest rebound in equity prices in recent weeks explains most of the rise,” said Paul Dales, senior US economist at Capital Economics. Yet he noted that since hitting a low of 55.7 in August, the index has retraced only half of its decline from 77.5 in February, and is still significantly below its long-term average of 86.
More good news comes from a Gallup survey, which reports that consumers plan to spend more money this holiday season than they did last year.Rising consumer spending is not, on its own, a sign of economic recovery, but put this together with some encouraging news on the jobs front and growth front more generally and it is hard to avoid the conclusion that the American economy is slowly moving into a recovery.That could still be derailed; just as in 1931 a European financial crisis knocked the United States back into an even deeper depression things could still go awry here. But just as trees don’t grow to the sky, holes don’t go all the way to China. For three hundred years market economies have been cyclical. The safest economic prediction anybody can make is that “This, too, shall pass.”That still looks true today.