Wednesday, March 19, 2008

How Does a Recession Look?

Three out of four Americans think the country is a recession, the Zogby Poll reports today, and confidence in the economy, President Bush and Congress has plummeted.

"As oil prices hit record highs," the pollsters note, "Americans say they are prepared to take measures to compensate if oil prices continue to rise--37% plan to drive less, 24% would reduce retail and entertainment spending and 19% would try to conserve energy at home."

Retail sales are slowing down, and payrolls fell by 22,000 in January and 63,000 in February.

Anecdotal evidence is everywhere. Once-crowded restaurants have empty tables, and consumers are rethinking optional spending. In one of the wealthiest areas in Connecticut, a prominent dentist reports a sharp drop in cosmetic surgery as his hygienist tells of losing her overleveraged home to foreclosure.

Starbucks is closing 100 stores in the face of sales losses and has decided to stop offering hot breakfast sandwiches because customers complained about the aroma. As the Bush era stumbles toward a close, Americans are having a lot of trouble telling themselves to wake up and smell the coffee.

Things may get better when taxpayers start getting stimulus checks in May, but not many are willing to bet on it by buying more now.

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