August consumer sentiment declines sharply

[TexasLawyer]

Source: Reuters

August consumer sentiment declines sharply
Fri Aug 17, 2007 10:44am ET
Business News

NEW YORK (Reuters) - U.S. consumer sentiment deteriorated in August to its weakest in a year as more expensive oil, declining home prices and turmoil in financial markets all hurt confidence.

The Reuters/University of Michigan Surveys of Consumers said its preliminary reading on consumer sentiment in August was 83.3, well below a median forecast of 88.0 and a sharp fall from the previous month's final reading of 90.4.

The data came just hours after the Federal Reserve cut its primary discount rate, or the rate the central bank charges commercial banks to borrow directly from it, by half a percentage point. The Fed said the downside risks to economic growth had increased "appreciably."

The unexpectedly weak reading in consumer sentiment backed a view that volatile swings in financial markets, including a steep fall in share prices since mid July, are starting to dampen the mood of consumers. "I would have to say that it is not a good sign, and it is showing how the contagion on Wall Street is starting to affect Main Street out there," said George Lucas, senior investment strategist at Deutsche Bank in New York.



Read more: http://today.reuters.com/news/articlebusiness.aspx?type=ousiv&storyID=2007-08-17T144402Z_01_N17451906_RTRIDST_0_BUSINESSPRO-USA-ECONOMY-SENTIMENT-DC.XML

[Purveyor]

1. "Back to school" retailers are sure to take a hit this year. n/t

[David__77]

2. Declining home prices are good news to this renter!

I feel bad for those who bought in at the wrong time or who are sitting on negative equity due to drawing income from their home equity, but the prices are simply unsustainable. Certain macroeconomic factors largely determine housing prices during "normal" operation of the market. These have been obscured by a credit bubble and hysteria not dissimilar to the famous Tulip speculation hundreds of years ago.

[kestrel91316]

3. Here in Los Angeles, the housing (sales) market is quite bad, but

rental rates are still climbing rapidly. The landlords know that with no mortgages being issued, they have renters in a stranglehold.

[krabigirl]

5. Actually, I have read the opposite.

At least for Orange County, the rents are not increasing, due to all of the homes that were on the market and did not sell. Many were turned over into rental properties by the owners. So, there are plenty of rentals available, so the landlords have not been increasing rents. Maybe it has changed in the last few weeks, but this was the case in July.

[Tempest]

6. Rents are rising here in Kern County

And from reports I've read, they're rising all over the state.

[David__77]

7. Not in Sacramento.

They've been pretty flat for several years. There is a glut of available units.

[kestrel91316]

8. Rents aren't dropping in the San Fernando Valley, that's for sure.

I know. I'm looking for a unit.

[napi21]

4. Yea, WM has already been crying about that. Said their

shoppers run out of $$ before the end of a month. NS Sherlock! That's not news, it's just getting worse!

[spinbaby]

9. When the economy crashes, it'll be our fault

You wait and see if they don't blame the collapsing economy on "consumers."

[candice]

10. won't all the cheap crap I buy that was Made in X fall apart soon...so I'll have to waste more

resources to replace it.

From: http://blog.liferemix.net/minimalism-isnt-so-minimal

Connie Cox and Cris Evatt in 30 Days to a Simpler Life share a simple maxim that was a revelation when I first read it. Never let anything cross the threshold of your home unless it's something that you know you need or that you know you will love and cherish for a long time to come. That bobble-head you got for free for filing up your gas tank doesn't count. Neither do pasta machines, breadmakers, or ice cream makers in most cases. Before you buy anything, ask yourself, do you really need it? Is it a replacement for something you're throwing out? Is it another black sweater? Or is it something you don't already have?

[aquart]

11. It's gonna be a hard candy Christmas.

Unless the candy is made in China.

[jordi_fanclub]

12. And a rush to pull out cash from Countrywide...

Anxious customers jammed the phone lines and website of Countrywide Bank and crowded its branch offices to pull out their savings because of concerns about the financial problems of the mortgage lender that owns the bank.
...
At Countrywide Bank offices, in a scene rare since the U.S. savings-and-loan crisis ended in the early '90s, so many people showed up to take out some or all of their money that in some cases they had to leave their names.

http://www.latimes.com/business/la-fi-countrywide17aug17,0,5212161,full.story?coll=la-home-center