Consumer spending increases while income decreases…?

March 27, 2009 – 10:15 pm – No Comment

From the AP:
“Consumer spending rose by 0.2 percent last month after an even bigger 1 percent jump in January, which was the largest one-month gain in 3 1/2 years, the Commerce Department reported Friday. Those gains followed a record six straight monthly declines as consumers tightened their belts in the face of a deepening recession.

Americans’ incomes slipped further in February, dropping by 0.2 percent, the fourth drop in the past five months, as wages and salaries continued to be battered by the massive layoffs that have occurred as the recession, already the longest in a quarter century, has deepened.”

It just doesn’t seem like these two small paragraphs of information mesh well…at all. This is a “wait…what??” kind of moment. While people are earning less they are spending more? Perhaps it is because of things being more expensive…maybe it’s because they just want to see if money really can buy happiness. However, over the past few years while almost no one has saved any and a lot of people have put all their expenses on credit cards, spending is probably not the way to go.

Personally, I’m trying to cut back, I cook more and use coupons when it comes time to go to the grocery store. I actually spend a lot of time on the internet trying to find coupons and deals for things I have to buy anyway.