Concerns grow about whether consumers will spend as economy weakness spreads

www.washingtonpost.com

Cracks in the economy are starting to show. Credit card debt default rates are rising, total household debt is at $13.86 trillion, $1.2 trillion higher than the previous peak of $12.68 trillion 2008 and corporate debt is sitting at close to $10 trillion, also near all time highs. This coupled with lackluster wage increases and an unemployment rate of 3.5%, a low not seen in 50 years means something is going to give. Consumers have so far been a bright spot in an otherwise flagging economy. and economists say this holiday season will be another test of their resilience.

Even so many consumers continue to feel good about their personal finances, according to the National Retail Federation’s chief economist. The question now, he said, is whether political uncertainty will offset their “willingness and ability to spend this holiday season.” Nearly 80 percent of consumers surveyed by the group said they were concerned that tariffs could lead to price increases and affect their shopping plans.

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