Approximately 70% of US GDP is attributed to consumer spending; therefore, all things being equal, a resumption of Air Jordan 13s consumer spending is necessary to provide enough growth to generate jobs. Job growth in turn generates further consumer spending which in turn leads to higher GDP, ad nauseam.
In the absence of consumption, net exports (exports imports) and capital investment will have to provide a greater share of GDP growth as the headwinds facing consumer spending are now at gale Nike LeBron 12 force. Consumers are not only facing minuscule private job growth but may now be facing a new round of job losses from federal, state and local governments.
With housing values still feeling for the bottom and 30% of housing values below their mortgage balances, there appears to be limited collateral supporting the borrowing for consumption. paying down their debt in lieu of consumption.
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This chart illustrates the degree of deleveraging that is taking place. It compares the quarterly closing price of the S 500 to the Household Debt Service Ratio payment as a percent of disposable personal income.
Consumers are paying less of their disposable income to service debt. This could be a function of several trends: Consumers are paying down their debt so there are less debt service payments to make; lower interest rates may have reduced such payments; a restructuring of the debt lowering payments by extending the loan beyond its original term; or bankruptcy or bulk debt forgiveness.
The Air Jordan Spizike chart also indicates Air Jordan 14s that the stock market has rebounded. This is due to strong corporate earnings likely as a result of companies becoming lean during the recession by ironically shedding jobs. However, consumers have not opened their wallets or taken on debt for the purpose of consumption.
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