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"American consumer spending, which accounts for more than two thirds of US domestic economic activity, was confirmed as having tumbled at a headlong annual pace of 4.3percent in Q4, equal to a quarter-on-quarter drop of 1 per cent, marking its sharpest drop since the second quarter of 1980." click here
I recently read this statistic in the Times Online, but I have seen this statistic in various books about the US economy. I'm not sure that Americans really understand this statistic. Sixty-six percent of our gross national product is based on people basically buying a bunch of stuff they don't need. The American "consumer" is expected to buy useless stuff even if he/she cannot afford it. The American consumer is expected to use a credit card and buy, buy, buy. That's what the so-called "consumer confidence" means. It means Americans are supposed to feel good enough to buy things that he/she does not need.
Now with unemployment rising, the American "consumer" will not be "confident" to buy anything. What will that do to sixty-six percent of our GDP? Well, it will crash. We had prosperity that was not really there. We have entire countries that depend on our reckless spending. We then borrow from those countries, (Japan and China) to keep on spending.
On the news last night I saw that Japan is already in a Depression. Are they expected to keep loaning us money while they starve to death? Shall Brazil, India, China, and Russia (BRIC alliance) give money to the glutonous West, so they can continue to lay waste to the environment, and continue imperial wars? Do you think they will? I'll bet they consider other issues far more important than our continued gluttony and continued imperialism.
