Friday, May 13, 2011

Just Can't Get Enough

Congratulations, we’ve done it again.  Just when we thought we had enough, we realized that was nonsense.  All the naysayers should have known Americans aren’t quitters!  To fill you in:  (and perhaps you’ve already blocked this from your memory) Back in bleaker times (far away in 2008 & 2009) some of us realized we had more debt than we could repay.  Our bank accounts were not feeling good (neither were the banks maintaining them, but they too may suffer from “select amnesia”).  Everywhere we went, we were constantly threatened with the “s-word” – save (*gasp*).   It was like a bad penny, constantly turning up.  And we were conflicted:  If we had to cut back our spending, how could we show the ones we love the most (ourselves) how much we care? Given how heavily our economy – our communities – relies on our everyday “retail” spending (about 33% of our annual economic output), how could we let our friends down?

Don’t worry, this trend didn’t last long (why should we have to exercise restraint? Don’t they know who we are?). It was certainly rocky for a while, but by late 2009 we were getting back on track (we all felt it; even Britney fell off the train and had to get back on again).   By “back on track” I mean spending more each month on retail purchases than we were the month before.  Certainly some of this had to do with natural price increases.  And certainly (much to our dismay) we have exercised some restraint and began saving more (we are now saving 5% of our income compared with the 2% average for most of the 2000’s).

Data released yesterday should let you continue to sigh your sigh of relief.  We can even say with a high level of confidence that the “real” (albeit mostly divorced) Housewives of Bravo network will have something to do tomorrow – shop and go tanning of course (now we can sleep soundly).  In April our spending on retail items increased at an annual rate of 7.6% (over the year before), and April retail spending was up 0.5% of March.  In fact, April is the 17th consecutive month that we have spent more money year over year ("retail expenditures" has increased).  In other words, we are back in the driver's seat, watch out. 

So what did we spend more money on in April?  Mostly gasoline for our cars (see previous post).  Other than gas, we enjoyed more food and drinks (good choice).  We also spent more money over the internet (working hard, are we?).  Hard as it is to believe, we also spent less money last month on a few items: electronics (saving up for the iPad2, nice) and on “books” (whatever those are).   

When is enough spending enough?  Never (trick question)!   Even the Black Eyed Peas know we just can’t get enough.  And now so do you.
(Census Bureau, Bureau of Economic Analysis)

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