Based on the
latest data (reported
earlier today), the rate of growth in year-on-year personal
income has fallen below that of personal spending, with the ratio of the
former to the latter hitting its lowest level since June 2010.
unless household income is poised for an imminent jump -- which would seem to
require a significant and sustained boost in new hiring in the absense of any "quick fix" stimulus programs --
this development suggests that the already languid pace of consumer spending
(especially when viewed in real, or inflation-adjusted, terms) is set to be
dragged even lower.
details like this don't really matter to equity traders, who've been buying
shares in the consumer discretionary sector like there's no tomorrow.
Michael J. Panzner