I may have been too hasty in lampooning the COMEDIC talents of the propagandists at Bloomberg. This particular piece of fiction is SO ABSURD that I have to grudgingly praise the quality of the humor here.

According to Bloomberg, Americans are so "tired" of tightening their belts that they are now starting to splurge again. And so the clever spin-doctors at Bloomberg have invented a label for this (mythical) phenomenon "frugality fatigue".

It is TRULY Orwellian to give a LABEL to a "trend" which doesn't even exist...



Put another way, while the same Americans who have seen their standard of living plummet by more than 50% over the past 40 years undoubtedly ARE "tired" of having less and less spend every month (in real dollars), with FALLING wages, FALLING employment, and little access to new CREDIT they don't have any choice.

P.S. Even more Orwellian is to refer to this Greater Depression as "a long, drawn-out recovery"

"Frugality Fatigue Spurs Americans to Trade Up"

www.bloomberg.com/news/2012-04-13/frugal...ans-to-trade-up.html

Americans are buying more expensive makeup and sandwiches again as Estee Lauder Cos. (EL) and Dunkin’ Brands Group Inc. (DNKN) get a boost from mid- to high-income customers.

“Frugality fatigue” is driving a rise in retail sales among consumers who’ve “grown tired of putting off discretionary purchases,” said Russell Price, a senior economist at Ameriprise Financial Inc. (AMP) in Detroit. Recent gains, including a 6.5 percent increase in February from a year earlier -- have been bolstered by improvements in consumer confidence and the labor and stock markets, along with some stabilization in home prices, he said.

“This has been a long, drawn-out recovery; [LOL!!!!!!!] and for most people alive today, it’s the longest they’ve had to conserve financially,” said Price, who was among the top-ranked forecasters of quarterly gross-domestic-product growth for the two years ending in February, according to the most-recent data compiled by Bloomberg. “As their prospects improve, some pent- up demand is being released.”

Even with a less-than-predicted gain in U.S. nonfarm payrolls last month -- 120,000 compared with a median forecast of 205,000 in a Bloomberg survey -- the economy has added 635,000 jobs since December as unemployment fell to 8.2 percent from 8.5 percent, Labor Department data show. Meanwhile, the median price of existing homes climbed 0.3 percent in February from a year earlier, the biggest gain since July 2010, and the Standard & Poor’s 500 Index is up 10 percent this year.
‘Feeling the Wealth’

Mid- to high-income consumers are “feeling the wealth effect” from an “amazing run” in the stock market, said Britt Beemer, chairman of America’s Research Group, a consumer- behavior research and consulting company based in Charleston, South Carolina. The gain is leading some people to purchase name brands in lieu of generic or buy spring fashions before they’ve been deeply discounted, he said.

Sentiment among people earning more than $50,000 fell to minus 12.2 in the week ended April 8 from a four-year high of minus 8.2 the prior week, according to the Bloomberg Consumer Comfort Index. Americans making more than $100,000 were the only income group with a positive reading: 9.7 (COMFO100), the second-best since January 2011.

Estee Lauder’s “high-end luxury” skin-care and makeup brands are growing “faster than average,” benefiting from consumer trade-up and affluent shoppers, President and Chief Executive Officer Fabrizio Freda said Feb. 24 at the Consumer Analyst Group of New York conference. The New York-based company’s 16.5-ounce Crème de la Mer moisturizing cream sells for $1,800.
More Appetizers

Customers at BJ’s Restaurants Inc. (BJRI) eateries are ordering more appetizers or drinks with their meals, Chairman and Chief Executive Officer Gerald Deitchle said on a Feb. 16 conference call. As a result, the Huntington Beach, California-based operator is “selling more items per 100 guests today than we ever have in the history of the company.”

Americans will probably eat out more frequently in the next 90 days -- and spend more while doing so -- as their financial health improves, based on monthly surveys by RBC Capital Markets in New York.

The portion of respondents who said they spent more than planned at restaurants during the past 30 days reached a record 31 percent in February, according to a quarterly survey. They predicted they will spend a combined $37.01 on restaurant meals each week for the next three months -- up 2.7 percent from a year earlier.
‘Plodding Uphill’

Consumer-spending plans rose at full-service restaurants for the second consecutive quarter and fell at quick-service establishments, suggesting people probably will trade up again after a year of trading down, said Larry Miller, an RBC analyst in Atlanta. Though dining-out intentions are “plodding uphill” from low levels, there’s some momentum for a further recovery, he said.

“This trend is encouraging because it’s rooted in strong economic fundamentals,” Miller said, noting that one of the most-cited reasons for increased purchasing plans was an improving economy. The U.S. will expand 2.3 percent this year, according to the median estimate of 75 economists surveyed by Bloomberg News from April 6 to April 11. Growth last year was 1.7 percent.

Even customers at fast-food chains such as Dunkin’ Brands doughnut shops are opting for a “better level of sandwich,” Chief Executive Officer Nigel Travis said on a Feb. 9 conference call. This has helped to drive a “higher average ticket,” with its smoked-sausage breakfast sandwich one of the best- performing, limited-time offers in the Canton, Massachusetts- based company’s history, he said.
‘Live With Less’

As Americans have “learned to live with less,” income-tax refunds could increase their willingness to spend, Beemer said. For the first time in six years, people will have money left over for discretionary purchases, after about two-thirds used a majority of these funds to pay off bills or credit cards in the past, he said, citing his company’s late March survey of 1,200 consumers nationwide.

The spending boost may be temporary, because rising gasoline prices are “the biggest nemesis to retail sales,” Beemer said. The average gallon of regular unleaded is up about 22 percent to $3.91 (3AGSREG) -- near a three-year peak -- from a low of $3.21 in December, according to Heathrow, Florida-based AAA, the largest U.S. motoring organization.

Some low-income consumers still are demonstrating frugality, and industry data show there’s a “barbell” phenomenon, with fine-dining and fast-food restaurants doing well and middle-tier eateries struggling, Miller said.
Fixed-Price Menu

Ruth’s Hospitality Group Inc. (RUTH), which operates upscale steak and seafood restaurants, introduced a fixed-price meal for these “special occasion” diners to keep sales up, even though “life is largely back to normal” for its more-affluent customers, Chief Financial Officer Arne Haak said at a March 6 conference hosted by Raymond James & Associates Inc.

Kroger Co. (KR), with grocery stores in 31 states, also has seen bifurcated spending patterns, Chief Financial Officer Michael Schlotman said at a March 28 Telsey Advisory Group conference. Its “budget-minded” shoppers continue to “show significant signs of stress and are more likely to trade down” when there are signs of economic weakness.

Even so, recent trends are encouraging, said Price of Ameriprise, a financial-planning and services company, who sees the disappointing March payroll numbers as an “aberration.”

As “employment prospects improve, consumers are going to put some additional spending back into the economy,” he said.

Jeff

If you want a brilliant, almost Rumsfeldian, one-liner; Pimpco's Mohammed El-Erian delivered one yesterday.


"In the last three plus years, central banks have had little choice but to do the unsustainable, in order to sustain the unsustainable, until others do the sustainable to restore sustainability!"


Seeing as there's little chance of politicians adopting sustainable fiscal policies (EU Finance head Juncker - "We all know what needs to be done; we just don't know how to get re-elected after we've done it...") then the "...final and total collapse of the currency system(s) involved" becomes inevitable.

"What cannot continue - will stop."

Screwloose wrote:
Jeff

If you want a brilliant, almost Rumsfeldian, one-liner; Pimpco's Mohammed El-Erian delivered one yesterday.


"In the last three plus years, central banks have had little choice but to do the unsustainable, in order to sustain the unsustainable, until others do the sustainable to restore sustainability!"


Seeing as there's little chance of politicians adopting sustainable fiscal policies (EU Finance head Juncker - "We all know what needs to be done; we just don't know how to get re-elected after we've done it...") then the "...final and total collapse of the currency system(s) involved" becomes inevitable.

"What cannot continue - will stop."

Lol Screwloose!!!

You've certainly one-upped me here. It's pretty hard to imagine even Bernanke topping a piece of gobbledy-gook like that.

I'm thinking that THIS line should perhaps be added to either our "Notable Quotes" thread, or perhaps "Famous Last Words".

Thoughts anyone?

Famous last words, considering that Notable Quotes are supposed to be sensible!

By the way what has happened to El Erian ? seems to be drifting to the other side ?

Jeff

It's far from gobbledy-gook - it sums up the international monetary situation with breathtaking brevity. They were forced into printing (the 'nuclear option' that has always failed before) just to hold the crumbling system together, temporarily, until the politicians stopped running suicidal bond-issuance and returned to balanced budgets.

The politicians didn't keep their end of the bargain - so now the die is cast.

samix wrote:
By the way what has happened to El Erian ? seems to be drifting to the other side ?

My theory is that Mohammed El-Erian isn't actually a real person, but merely a holograph created by the propaganda machine.



He is trotted out all the time to be quoted on ALL SORTS of subjects - many of which have absolutely no relevance to the bond market (and his own area of expertise). Of course it's much easier to FORM such a theory after seeing that quote from Screwloose.



My question is WHY do we see "editorials" appearing in supposed journalism outlets from these SALESMEN??? This is nothing but free advertising masquerading as "editorial opinions".

Every day, in every way, we see the supposed NEWS media demonstrating to a greater degree that it no longer has ANY IDEA of what it's own true function is, and (as a result) absolutely no idea how to operate these massive media oligopolies in a PROFESSIONAL manner - most obviously epitomized by Rupert Murdoch's right-wing propaganda factories.

Screwloose wrote:
Jeff

It's far from gobbledy-gook - it sums up the international monetary situation with breathtaking brevity. They were forced into printing (the 'nuclear option' that has always failed before) just to hold the crumbling system together, temporarily, until the politicians stopped running suicidal bond-issuance and returned to balanced budgets...

I stand corrected.

You are quite correct that it IS a very succinct summary of what has actually been taking place.

What I should have said in making my comment was that from a LOGICAL STANDPOINT it was obvioiusly "gobbledy-gook" since talking about "sustaining the unsustainable" is PRECISELY the Ponzi-logic that got us to where we are today.

More generally we have the capitalist economic model: INFINITE growth in a FINITE system. Is it any wonder that an economic philosophy based upon arithmetic which isn't even THEORETICALLY possible has degenerated into a series of ever more criminal and radical forms of SWINDLES involving LEVERAGE...?

Screwloose wrote:
Jeff

They were forced into printing (the 'nuclear option' that has always failed before) just to hold the crumbling system together, temporarily, until the politicians stopped running suicidal bond-issuance and returned to balanced budgets.

The politicians didn't keep their end of the bargain - so now the die is cast.

Does this not shift the blame to the politicians from the central bankers, when they are the actual drug pushers who addicted the politicians to easy money ?

Also I guess this takes the focus of the real culprits who the bankers and politicians both work for.

Jeff Nielson wrote:

More generally we have the capitalist economic model: INFINITE growth in a FINITE system. Is it any wonder that an economic philosophy based upon arithmetic which isn't even THEORETICALLY possible has degenerated into a series of ever more criminal and radical forms of SWINDLES involving LEVERAGE...?

[/quote]

All we have is the capitalist system - individuals interacting in their own self-interest - nothing else has ever demonstrated any capacity to endure beyond a few decades.

Capitalism doesn't require any growth - that's only necessary for the parasitic fractional-reserve banksterism that we're currently stuck with; capitalism doesn't even require banks - particularly if the means of exchange (the intermediate good) contains its own recognised value rather than being a note of someone else's liability.

I think by 'capitalist economic model' you meant the current corrupt system - which has a far more accurate name: Fascism - rule by an irremovable syndicate of thugs supported by large corporations.