US consumer sentiment hit its worst levels since the worst of the 1991 recession, according to the University of Michigan Consumer Survey. The survey dropped to 70.8, from 78.4 in January. The mid-February reading was 69.6, so it has improved slightly. Economists were expecting a reading of 69.4.
The index has fallen 30% since [...]
Nominal personal spending increased 0.4% in January, above the 0.2% expected by economists. Inflation was also higher in January, leaving real consumer spending flat for the month. Real spending on durable and nondurable goods fell, while spending on services rose.
Nominal personal incomes grew 0.3% in January, with wages and salaries increasing 0.5% in the month. [...]
Initial jobless claims, first-time claims for state unemployment benefits, jumped sharply for the week ending February 23. Claims increased 19,000, to 373,000, well above the 350,000 threshold economists believe indicates a weakening labor market. Economists were expecting a number closer to 350,000.
The 4-week moving average, a less volatile and more accurate measurement, fell by [...]
Allan Meltzer has an editorial in the WSJ which asks if the Fed is repeating the mistakes of the 70s. His answer is yes:
Is the Federal Reserve an independent monetary authority or a handmaiden beholden to political and market players? Has it reverted to its mistaken behavior in the 1970s? Recent actions and public commitments, [...]
