U.S. Consumer Spending Cools as Food, Fuel Costs Climb

Source: Bloomberg

Feb 28, 2011 12:02 PM ET

Consumer spending cooled more than forecast in January as rising food and fuel prices caused Americans to cut back on post-holiday visits to malls and restaurants.

Purchases rose 0.2 percent, the smallest gain since June, as winter storms may have also discouraged shoppers, according to figures from the Commerce Department today in Washington. A report from Chicago-area purchasing managers showed businesses expanded in February at the fastest pace in two decades.

Economists at Morgan Stanley and Deutsche Bank Securities Inc. cut forecasts as the data showed households may have used some of the extra cash from the payroll tax cuts to boost savings. At the same time, the world’s largest economy is getting a lift from manufacturers like Deere & Co. as business investment in new equipment accelerates and exports climb.

Read more: http://www.bloomberg.com/news/2011-02-28/consumer-spending-in-u-s-rose-less-than-forecast-in-january.html

But too many politicians are too ignorant or too beholden to their big money donors to understand basic economics.

After all, there is already talk of replacing the $ as world's reserve currency. If that happens, they will have to raise taxes on everyone to 99.9% and implement even more austerity measures.

Can they increase the COLA this year or do we have to wait another year and hope?

for determining 2012's COLA, fuel prices will kick up the inflation rate significantly, just as it happened in 2008 for the 2009 COLA.

so cost of living raises can be denied??

hard to say exactly how it's being gimmicked, but it sure is!!

and after two years -- it's over -- !!

The New Deal was one of the greatest stimulus programs ever put in place --

especially since it barred corporate crime/corruptin -- and allowed the nation

to move into an economic democracy!!