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Consumer Spending Slides In All Important June, Gallup Finds

Tyler Durden's picture




 

It appears the hopes and dreams of a resurgence in US GDP in Q2 will have to be extended-and-pretended another quarter. As Gallup notes, Americans' self-reports of daily spending fell back in June, averaging $91 for the month - down notably from a six-year high of $98 in May - and flat to the $90 average found in June 2013. Not exactly the pent-up demand 'surge' so many economists (and Fed PhDs) have been calling for... Even more concerning, Gallup notes, the drop in daily spending among all Americans can largely be attributed to upper-income Americans spending less in June. Even the 1% are cutting back?

 

As Gallup notes,

This $91 figure for June suggests a mixed bag for the economy. While it represents a much higher level of consumer spending than the $60 to $70 averages found for much of 2009 to 2012, it also represents the first decline in the monthly average since January of this year.

While Americans' self-reported spending in June was generally on par or lower than their average May spending, this month's $7 drop is one of the largest recorded by Gallup during this time of year since 2008, when June spending fell by $10. The June 2008 spending average of $104 is still the highest average for that month in Gallup's six-year trend.

...

The drop in daily spending among all Americans can largely be attributed to upper-income Americans spending less in June. Americans living in households with $90,000 a year or more in income reported spending on average $189 a day in May, but this dropped to $157 in June.

 

As Gallup concludes, Americans' average daily spending dropped in June from May's levels. This indicator fits in the context of scores on Gallup's other economic measures. Job creation remained flat, although maintaining May's six-year high. Economic confidence dipped slightly from May, but remains higher than the economic confidence found several years ago in the depth of the recession.

That self-reported spending did not increase in June is important, given that consumer expenditures are a significant driver of the U.S. economy. While Americans are spending more than they did several years ago, spending has not returned to pre-recession levels.

*  *  *

By Bye Q2 GDP surge...

 

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Mon, 07/07/2014 - 10:42 | 4931460 AlaricBalth
AlaricBalth's picture

It's the weather. Much too hot to spend money. Climate change has altered my spending habits. Either too hot or too cold. Never just right. 

Mon, 07/07/2014 - 11:10 | 4931568 pods
pods's picture

Wait until people start having to pay their new "health insurance" premiums. 

pods

Mon, 07/07/2014 - 11:14 | 4931585 ArkansasAngie
ArkansasAngie's picture

Inflation will keep that number high. Rent up.  Food up. Gas still up. F'ing cable TV up.

Is there another Apple new product coming out to save the day?

Who needs consumer spending when you've got Mid term elections pumping money into the economy and creating part time jobs.

 

Mon, 07/07/2014 - 11:24 | 4931620 Temporalist
Temporalist's picture

This is very much just like how "lowflation" replaced inflation; we now have "Nonsumers" instead of consumers.

Krugman and Yellen will fix it by rubbing a little paper on it.

Mon, 07/07/2014 - 12:22 | 4931801 Wait What
Wait What's picture

what's worse than a June drop in consumer spending?

a 50%+ drop in consumer spending in July.

I read this morning that revenue from filmgoers over the 4th of July weekend dropped from around $235 billion in 2013 to $127 billion in the US.

that's going to put a dent in the shiny new car that Q3GDP is supposed to be.

Mon, 07/07/2014 - 11:47 | 4931691 rum_runner
rum_runner's picture

No, no, no.. it's the world cup!  Too many people watching or not watching it.  

Mon, 07/07/2014 - 10:40 | 4931461 kliguy38
kliguy38's picture

It rained twice here and was really sunny too....must have been too sunny

Mon, 07/07/2014 - 10:45 | 4931472 Headbanger
Headbanger's picture

And all that wind too!  Way way too much wind over 5mph..

It's "Climate Disruption" I tell you!  CLIMATE DISRUPTION!!

Oh the agony..

 

Oh wait..

http://www.forbes.com/sites/jamestaylor/2014/06/25/government-data-show-...

Mon, 07/07/2014 - 10:56 | 4931520 espirit
espirit's picture

Moar like the hundred buck a month cut in EBT bennies.

Wally World is the eCONomy.

Mon, 07/07/2014 - 10:42 | 4931468 nmewn
nmewn's picture

This weather thingy is going to destroy whats left of the economy.

We need to find a way to tax it into doing our bidding ;-)

Mon, 07/07/2014 - 10:59 | 4931530 Jumbotron
Jumbotron's picture

Homeland Security has just put Mother Nature on the Terrorist Watch List.

H.A.A.R.P. is now being tweaked to provide a better response to such threats by Mother Nature.

Plus....H.A.A.R.P.'s servers have been connected into the database in Utah of the N.S.A.

Of course...with Chaos Theory being war-gamed now....(think butterfly wings in China causing Hurricanes in the Atlantic)....if you fart in public, expect to be droned.

Mon, 07/07/2014 - 11:09 | 4931564 nmewn
nmewn's picture

Uh oh, sounds like this shifting of "human capital" is gonna cause some job vacancies for inspecting little old ladies bungholes at airports.

The authoritarians work is never done ;-)

Mon, 07/07/2014 - 11:16 | 4931581 CheapBastard
CheapBastard's picture

Fellow down the block is a regional manager of a retail chain store said June sales were miserable and even worse, he said ‘foot traffic” was way down. This means people are not even entering the stores despite all the coupons, ‘cash-backs,’ discounts, etc. He attributes it to ‘broke, depressed consumers.’ He said July 4th weekend was “dead.”

 

He also said those expecting the internet sales tax to push people into the bricks stores were wrong. Didn't happen. No money to spend nowhere.

 

Forward!

Mon, 07/07/2014 - 16:46 | 4933021 Jumbotron
Jumbotron's picture

Fellow down the block is a regional manager of a retail chain store said June sales were miserable and even worse, he said ‘foot traffic” was way down. This means people are not even entering the stores despite all the coupons, ‘cash-backs,’ discounts, etc. He attributes it to ‘broke, depressed consumers.’ He said July 4th weekend was “dead.”

 

He also said those expecting the internet sales tax to push people into the bricks stores were wrong. Didn't happen. No money to spend nowhere.

 

Forward!

 

Reminds me of the Thanksgiving of 2006 vs 2007.  I had lost a good paying job and was working two jobs to make ends meet.  One of them was a shitty part time job with Office Depot.  We had a full staff in every department in 2006 and Thanksgiving 2006 sales were like gangbusters.  Fast forward to 2007 and I and the copy girl were the only people on the floor for 8 hours until the evening shift of two people came in.  Then came Thanksgiving 2007.  We opened an hour later than 2006 and after the 1st hour we were dead.  We could have closed up shop for the rest of the day.  We didn't even have stragglers coming in the afternoon once they had hit all the sweet spots in the morning.

Then not long after came the collapse of 2008.

Sounds to me like history is rhyming.

Mon, 07/07/2014 - 16:40 | 4932991 Jumbotron
Jumbotron's picture

"inspecting little old ladies bungholes at airports."

That's a picture I'm am going to have to drink ( a LOT ) out of my head .


Mon, 07/07/2014 - 10:43 | 4931469 p00k1e
p00k1e's picture

I bought stuff in June.  I bought stuff in July, and you should too.

 

bush: go out and shop

http://www.youtube.com/watch?v=fxk9PW83VCY

Mon, 07/07/2014 - 11:37 | 4931660 viahj
viahj's picture

me too...preps, pms and such.

Mon, 07/07/2014 - 10:46 | 4931478 JustObserving
JustObserving's picture

Who the fuck cares what Gallup says?  The US BLS has been making up statistics for more than 30 years now.  There is no economic statistic that cannot be adjusted to move the markets higher.

Forward

Mon, 07/07/2014 - 10:46 | 4931480 drstrangelove73
drstrangelove73's picture

I called it last quarter.We're in a depression.
This is what a depression looks like with unlimited govt.Money printing.

Mon, 07/07/2014 - 11:06 | 4931549 pods
pods's picture

Last quarter?  Well, better late than never.

:)

pods

Mon, 07/07/2014 - 12:28 | 4931834 SDShack
SDShack's picture

It's been a depression since 2000. The only "recoveries" have been Fed blown bubbles. This is not going to end well.... for anyone.

Mon, 07/07/2014 - 13:20 | 4932036 Dollarmedes
Dollarmedes's picture

Yeah, the Fed "blows," alright.

Mon, 07/07/2014 - 10:46 | 4931481 Rosie-Redknapp
Rosie-Redknapp's picture

Precious metals aside,  I conclude that the majority of spending was on sun tan lotion, sun hats, umbrellas and wind breaks. 

Mon, 07/07/2014 - 11:08 | 4931561 jbvtme
jbvtme's picture

and prostate meds

Mon, 07/07/2014 - 12:38 | 4931871 yogibear
yogibear's picture

And condoms.

Mon, 07/07/2014 - 10:46 | 4931482 Doubleguns
Doubleguns's picture

Its just gonna get hotter through 3rd qtr. GDP is screwed. 

Mon, 07/07/2014 - 10:47 | 4931486 Rainman
Rainman's picture

ObamaScare ! .... the final nail in the consumer's coffin.

< Gosh, we thought ObamaScare meant free ! >

Mon, 07/07/2014 - 10:49 | 4931487 Dr. Engali
Dr. Engali's picture

Lazy unpatriotic Americans. Get out and spend you lousy CONsumers. It's your duty and your natural born right!

Mon, 07/07/2014 - 10:52 | 4931504 Soul Glow
Soul Glow's picture

With rhetoric like that, you'd make a fine POTUS.

Mon, 07/07/2014 - 10:56 | 4931522 TWFTG
TWFTG's picture

You are 100% right !! These bastard traitors need more credit cards for buying useless stuff .

Consumption is a national security issue !

They dont get it !!

Mon, 07/07/2014 - 11:23 | 4931617 Milton Waddams
Milton Waddams's picture

You're right. If these worthless eaters aren't willing to leverage-up and buy "butter" in a ZIRP / NIRP world...

 ... there will be "guns."

Mon, 07/07/2014 - 11:42 | 4931681 Al Huxley
Al Huxley's picture

Let's resurrect the term 'burden of consumption' - it sounds so noble.

Mon, 07/07/2014 - 10:50 | 4931493 Carpenter1
Carpenter1's picture

Meaningless number if not combined with the total number ot spenders. The pie of consumers available to spend is shrinking, all we're doing is measuring the brightest spots in the economy, leaving out those who spend practically nothing per day.

 

That would be roughly 100 million according to government handout data.

Mon, 07/07/2014 - 10:51 | 4931495 orangegeek
orangegeek's picture

I'm outta fewd stamps Barry.

Mon, 07/07/2014 - 10:52 | 4931499 Bemused Observer
Bemused Observer's picture

I've actually spent more than twice the monthly average for the past few months. But not at the retail level.

I've been doing a lot of shopping, second-hand. Cash only sales, no sales taxes, no paper trails. I get what I want, but I avoid feeding the beast.

And the stuff I sell makes me more money than I originally spent, meaning I've gotten everything for free...actually got PAID to take it.

It's my own form of protest, my little "economic pitchfork" aimed at TPTB.

Mon, 07/07/2014 - 10:55 | 4931519 IridiumRebel
IridiumRebel's picture

good job

Mon, 07/07/2014 - 17:41 | 4933236 PoliticalRefuge...
PoliticalRefugeefromCalif.'s picture

..gone fishin' sign replaced by a gone gault sign all across America..

Starving the beast is the only way to defeat it, the Leviathan is already feeling the hunger pangs..

Mon, 07/07/2014 - 10:52 | 4931500 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

Financial repression is a very hidden tax. With interest rates on savings accounts at historic lows, the middle class' spending power gradually continues eroding.

Mon, 07/07/2014 - 11:42 | 4931684 Space Animatoltipap
Space Animatoltipap's picture

Only a fool saves money in a political faith money system.

Mon, 07/07/2014 - 10:53 | 4931502 buzzsaw99
buzzsaw99's picture

the usa trade deficit is wholly dependent on "the consumer". get out there and spend bitchez. [/s]

Mon, 07/07/2014 - 11:00 | 4931533 foodstampbarry
foodstampbarry's picture

Fuck you, I ain't spending shit. Let his fucker burn bitchez!

Mon, 07/07/2014 - 10:55 | 4931515 Soul Glow
Soul Glow's picture

Shit, what's a Chinaman to do?

Mon, 07/07/2014 - 10:56 | 4931524 Dr. Engali
Dr. Engali's picture

Eat stir fried feline.

Mon, 07/07/2014 - 11:01 | 4931534 nmewn
nmewn's picture

General Meows Chicken?

Mon, 07/07/2014 - 11:07 | 4931555 Ban KKiller
Ban KKiller's picture

Me? Well I shop black market first before thinking of "new". 

"Pent up demand", perhaps. Money? Not so much.  Oh...Cheneys are traitors. Just a reminder so you know who the enemies are. 

Think juvenile bankster (skunk) got into the chicken coop. Now we have a trap set with chicken bones, bacon and a little old ladies bank account. If we catch it we will release at the cop shop. 

Mon, 07/07/2014 - 11:17 | 4931591 yogibear
yogibear's picture

Well I shop black market first before thinking of "new". 

Exactly what many 20 and 30 somethings do nowadays.  Enormous bargins and reuse.

Know someone that just picked up a $700 camera for less than $400. 

Mon, 07/07/2014 - 11:08 | 4931558 yogibear
yogibear's picture

Too much hot air from CNBC.

Mon, 07/07/2014 - 11:08 | 4931560 SMC
SMC's picture

Bet a cup of coffee, that somewhere, a regime connected academic asshat is busy working on a proposal that the taxpayers fund a 10 Million+ USD "study" with "sufficient flexibility" to support a regime press release explaining why employment statistics have decoupled from spending and how it is good, just, patriotic and portrays the Obummer's greatness at work for "We the Sheeple". LOL.

Mon, 07/07/2014 - 11:14 | 4931582 yogibear
yogibear's picture

Wall Street has forced 20 and 30 somethngs to look for used 2nd and 3rd-hand goods and autos to find ways to save so they can pay their student loans and live with their lower salaries.

Now their hooked. Why buy new and retail as well as pay taxes.

A win-win for the underground economy.

Mon, 07/07/2014 - 12:44 | 4931877 SDShack
SDShack's picture

Just like we have bi-flation (inflation for goods & services you need to survive, and deflation on wages), we have bipolar consumer spending. The coveted 18-39 demographic is living at home, sponging off mom & dad for room & board & transportation, while going into debt for a college education to work a part time or full time job that has nothing to do with their major, while having every iGadget as soon as it comes out, and fill their free time either playing video games (which they buy) or going out with friends and partying. They are being trained to be dependent on others because they choose to live beyound their means, plus failing to plan for their future. The perfect debt slaves are being grown. Any inheritence they eventually get from Mommy & Daddy will be pissed away immediately to cover their ever growing expenses, forcing them into more debt, and leaving them progressively worse off the more they spend. I've seen it first hand.

Mon, 07/07/2014 - 11:18 | 4931596 CheapBastard
CheapBastard's picture

"All that money is sitting on the sidelines, ready to be spent any moment...."

 

BaaaWaaaHaaa!

Mon, 07/07/2014 - 11:27 | 4931626 The Carbonator
The Carbonator's picture

Starve the beast.  Spend nothing.

Mon, 07/07/2014 - 11:39 | 4931677 Yancey Ward
Yancey Ward's picture

It snowed in Greenland in June.  Also, the racist Republicans in the poll uniformly claimed they spent a negative $5103 dollars in June, thus making Obama look bad.

Mon, 07/07/2014 - 11:51 | 4931703 rosiescenario
rosiescenario's picture

Obviously if spending per capita is declining we need to increase the number of 'capita' by allowing anyone who wishes to come here do so.

Mon, 07/07/2014 - 11:57 | 4931712 Chuck Knoblauch
Chuck Knoblauch's picture

Yellen needs a new set of pom-poms.

THE TRUTH WILL OUT.

Mon, 07/07/2014 - 11:57 | 4931713 The worst trader
The worst trader's picture

The only one spending is our government. they spend the money so we the people don't have to think that hard. They know best rite?

Mon, 07/07/2014 - 11:59 | 4931723 oklaboy
oklaboy's picture

after food, what  money remains?

Mon, 07/07/2014 - 13:42 | 4932112 thamnosma
thamnosma's picture

Food inflation has been doing a slow creep up for so long I hadn't really noticed how bad it is until recently.   I try to buy high quality food within reason and do all my own cooking -- no processed foods.  Still, I can't get out of Trader Joe's, no matter what I'm buying, for less than 45-50 bucks for two less than full bags.   The situation is dawning on me quite clearly now.  

 

Raw nuts are part of my diet.  Only 3-4 year ago another local chain, Sprouts, regularly had deep discount specials that rotated from almonds to walnuts to cashews to pecans, etc.   Not only do those specials no longer exist whatsoever, but the base price is up 20-30%.   Pecan prices are unreal and I've stopped buying them.  

 

Yeah, if you're a lawyer, real estate developer, surgeon, etc. probably makes no difference at all.  However, for the majority of the working middle class, there simply has to be less discretionary money available....has to be.

Tue, 07/08/2014 - 04:49 | 4934618 kareninca
kareninca's picture

I (sort of) like Sprouts, but it is NOT a "local chain."  It is owned and run by a hedge fund.  BTW, at the Mountain View, CA Sprouts where I sometimes shop, the produce is well labeled in re country of origin.  The bulk food (like the nuts you are buying) are not labeled in re country of origin at all.  They could be from anywhere.  Their bakery goods have the same weird 'n creepy ingredients that Safeway bakery goods have.  I'm not saying don't shop there, but look first.

Mon, 07/07/2014 - 12:40 | 4931885 overmedicatedun...
overmedicatedundersexed's picture

anyone who is a golfer here knows - empty parking lots and when I do golf I get below quoted price by just saying look the price at so and so golf course is this, and they then drop the rate to beat that quote. things are bad for all the golf courses in my area. people who golf can't seem to come up with the green fees..green shoots turned dark brown.

Mon, 07/07/2014 - 13:34 | 4932084 thamnosma
thamnosma's picture

My golf addict friends haven't slowed a beat.  Then again, they have a lot more money than I do.

Mon, 07/07/2014 - 12:52 | 4931934 starman
starman's picture

Cant the US just print some really nice weather? Damn it!

Mon, 07/07/2014 - 13:14 | 4932012 Chuck Knoblauch
Chuck Knoblauch's picture

This is going to get fun.

Bypass the pawns.

 

Mon, 07/07/2014 - 13:33 | 4932079 thamnosma
thamnosma's picture

When are the stats for 2Q GDP released?

Mon, 07/07/2014 - 17:45 | 4933254 PoliticalRefuge...
PoliticalRefugeefromCalif.'s picture

-as soon as the acid kicks in..

Mon, 07/07/2014 - 21:00 | 4933901 Midnight Rider
Midnight Rider's picture

Another point is they are probably getting less for that $91 than they used to with inflation, shrinkflation, etc.

Mon, 07/07/2014 - 21:01 | 4933904 hooligan2009
hooligan2009's picture

the GDP for any quarter is measured with a six week lag, so second quarter GDP takes 6 weeks to compile and is measured (or more accurately stated, not measured, but "surveyed" and seasonally adjusted) using data between 15 February and 15 may.

Trade accordingly. Just saying.

Onwards!

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