Jill Schlesinger: More consumer spending, less saving
Steve Chiotakis: Word today from the Commerce Department that consumer spending was up in September more than half a percent. At the same time, Americans are saving less and aren’t seeing much growth in income.
Jill Schlesinger is editor-at-large at CBS/MoneyWatch, and she’s with us live from New York, as she is every Friday morning. Hey Jill.
Jill Schlesinger: Good morning.
Chiotakis: So it seems like people are spending a little money now — but at the expense of savings. What’s going on?
Schlesinger: Well, that’s actually problematic. You know the personal savings rate dropped to 3.6 percent; it’s the lowest since December of 2007. And yesterday’s GDP report — same trend that we saw. When households increase spending at the expense of saving, it’s just not sustainable, and that makes these results somewhat suspect.
Chiotakis: I know you just mentioned GDP numbers. The third quarter growth in the economy was about right on target — about 2.5 percent. Is that enough growth, Jill, to really create jobs and get the economy going?
Schlesinger: You know that rate is just about the long-term average, but it’s really low for a recovery. To start to see real improvement in the jobs crisis, growth needs to be above 3 percent for a few quarters in a row — you know, versus the herky-jerky results we’ve seen over the past few quarters.
Chiotakis: Which was what, 1.3 percent quarter before?
Schlesinger: And a 0.4 percent the quarter before that.
Chiotakis: Jill Schlesinger from CBS/MoneyWatch. Jill thanks.
Schlesinger: Great to be with you.
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