All three areas of Western economic life show negative trends: prices have continued to rise due to the central banks’ massive money creation to bail out, in part, the banking and financial sector. Taxes remain confiscatory and have not been cut in any meaningful way. And, the personal savings rate has hovered around zero.
Until the idea of consumer spending has been debunked as a meaningful index of economic conditions, the public will continue to be misled by the actual state of market affairs. When more accurate indices of economic conditions are looked to, then the notion of what constitutes real prosperity and/or economic recovery will have different connotations. Applying such indicators to current reality shows a stark and gloomy contrast to the rosy portrait of things that consumer spending enthusiasts so often espouse.
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