RRJ

Reference:


Healy, J. (2009, August 28). Consumers enticed to spend more in July, data say. The New York Times, Retrieved September 19, 2009 from http://www.nytimes.com/2009/08/29/business/economy/29econ.html


Summary:


According to Healy (2009) in his article, “Consumers Enticed to Spend More in July, Data Say” American consumers have spent a lot of money in July. Although consumers took benefits of the government’s cash, they were still struggling to cause high prices of goods and services. In addition, reports indicate that personal spending rose in July from a month earlier, while personal income remained unchanged from a month earlier and the savings rate fell in July. But economists expect that savings will improve because of the worry of consumers about the value of their homes and stock.


Reaction:


Because of the high prices of goods and services in the last period in America, consumers spent a lot of money. Even government subsidies did not lead to increased savings; also lower house prices, imbalance of financial markets, and the spread of unemployment may lead to a state of economic recession in the future. So American government should support the prices of goods and services, maintain the purchasing power of dollar, and fight the spread of unemployment.