Revelations 18:23:’For the merchants were the great men of the earth; for by thy sorceries were all nations deceived.’
- The US consumer is starting to freak out
- The flush savings accounts and cheap credit that helped keep Americans spending at high rates since 2020 are disappearing
- Retail purchases have fallen in three of the past four months. Spending on services, including rent, haircuts and the bulk of bills, was flat in December, after adjusting for inflation, the worst monthly reading in nearly a year.
- Sales of existing homes in the U.S. fell last year to their lowest level since 2014 as mortgage rates rose. The auto industry posted its worst sales year in more than a decade.
- One factor making forecasting more difficult: While unemployment is trending at a half-century low, big companies including Amazon.com Inc., Goldman Sachs Group Inc., and Microsoft Corp. have begun to cut jobs.
- Also weighing on many consumers: The rapid increase in rates in the past year, tied to Fed tightening, has pushed the cost of all types of debt higher.
- Mortgage rates reached a 20-year high last fall. Some 57% of consumers were concerned about making housing payments in the fourth quarter
- Additionally, tens of millions of Americans are set to start or resume making payments on student loans later this year, after the Supreme Court rules on President Biden’s student-debt cancellation plan. Payments have been frozen since March 2020, and are scheduled to begin again 60 days after litigation is resolved or the program is implemented.
- Many taxpayers will get smaller refunds when they file their returns in the coming months because Congress didn’t extend the breaks put in place at the height of the pandemic.
- S. factories, shippers and importers are pulling back, a sign they anticipate less demand from Americans in the months ahead.
- Inbound volumes at the ports of Los Angeles and Long Beach in California were down 20.1% in December from a year earlier, and have been behind 2019 levels since August.
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