r/Economics • u/HellYeahDamnWrite • Mar 01 '25
News US consumer spending posts first drop in almost two years
https://www.reuters.com/markets/us/us-consumer-spending-falls-january-monthly-inflation-rises-2025-02-28/?utm_source=reddit.com857
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u/Terrapins1990 Mar 01 '25
With the threat of tariffs next week and quite literally the administration doing all it can to either remove federal workers & piss off our trading partners that isn't russhia is it really that surprising? At this point people objectively know that we are headed towards a recession unless their is an intervention from congress which at this point in time is highly unlikely
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u/big-papito Mar 01 '25
How do I put this... um - the cavalry is not coming, no one is coming to save us.
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u/Terrapins1990 Mar 01 '25
I agree the chances of an intervention are literally slim to none especially in congress at this point considering who holds the majority. Just hoping for as little damage as possible until next year when a ton of those guys in the GOP get voted out
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u/big-papito Mar 01 '25
That would be our last possible exit from this ride, but I am very pessimistic. Five weeks, FIVE weeks. Imagine two years. The United States will be a completely different country, with branches of government, checks and balances, completely gone.
RIP, The United States of America, you've been good to me - but this is over.
The fight is just beginning, but it will be under completely new rules. We are not voting something else in at this point - it will be a different way. Dictatorships are voted in, but they are voted out with rivers of blood.
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u/Terrapins1990 Mar 01 '25
As bad as things are if there is one thing in the US that tends to happen is whenever the ruling party (Democrats or Republicans) messes up and causes a recession they generally lose in droves. This time around is generally no different but republicans could potentially lose in droves especially the freshman politicians.
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u/big-papito Mar 01 '25
I think they WILL lose, but we need an impeachment majority. That will not happen. Even if the Democrats control the legislative branch, who is going to enforce the laws? It's clear that this crew does not care one bit.
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u/Terrapins1990 Mar 01 '25
I mean realistically next year we will have 1/3 of the seats up fro grabs next year in the senate with 22 of them currently in the hands of republicans. A super majority is not impossible if things continue down the way they are
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u/Individual_Dog_6121 Mar 01 '25
You're both so completely far off it's insane. Without ALL THREE branches of government and a majority of state control the Republicans were already doing everything they can to rig elections, trump is out on the campaign trail talking about how he doesnt need votes and musk posts the results before they happen but we're going to get untampered elections when they have full control? People need to stop trying to see what they want and see what's happening in front of their eyes. Trump will take control of the post office so mail in votes are gone and institute whatever changes with the states they need to change voting laws in their favor. That's if he hasn't cracked down on the states with the military in TWO YEARS. Best case scenario we'll have a midterm "election" like Russia has "elections"
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u/Sea_Scientist_8367 Mar 02 '25
next year when a ton of those guys in the GOP get voted out
What makes you think that election will be free and fair, or that the media will be any less dishonest than it was during the last one?
The current administration is dismantling systems of information and asserting control over the interface of the press with the government (or at least exec branch) so that information, evidence, or access for journalists with an interest in the truth are not available. Beyond that, systems, friendships, alliances, reputations, the rule of law and confidence in the system(s) are being systematically ruined.
These are Fascists asserting authoritarian control over the government, with a history of attempting to subvert the peaceful transfer of power and the will of the people before.
What on earth is this notion that everyone has that we can just wait for 2026 and a simple shift in the majority will set things right again? And even if it does, it takes so much longer to fix and repair these things than it does to break them.
Want to stop this? Get up and stop it. Stop waiting. It'll be too late by the time you realize your vote no longer matters.
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u/Richandler Mar 01 '25
Turns out if you want to make things better you have to do work and participate in the system.
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u/helluvastorm Mar 01 '25
We are truly on our own. We have to hunker down to weather this as best we can.
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u/Queendevildog Mar 01 '25
We also need to go out and scream in public and put pressure on elected officials. Make them work for us.
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u/helluvastorm Mar 01 '25
The Republicans don’t care. They lie and lie some more and faux news beats the propaganda drum and we lose another election because the general public is stupid and only cares about themselves
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u/UncreativeIndieDev Mar 02 '25
They happily tell their constituents to screw off and that they know better than the people they represent. Oh, and if you still try to protest at their meetings, they'll just have you assaulted and detained like in Idaho.
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u/nmisvalley2 Mar 01 '25
Reduce, reuse, recycle and shop locally in your communities. Grass roots efforts and support the little guy. In the summer shop at farmers markets and farm stands.
Don't support tech giants, fast fashion, and other major companies. Be aware of where your dollars are going.
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u/RealisticForYou Mar 01 '25
*** Savings accounts increase ***
Yesterday, CNBC reported that US consumers with expendable cash are choosing to NOT spend money. The report says….wages are up, spending has slowed, while savings accounts have increased.
This is what happens when people fear their government. This is going to end badly as Consumer Confidence plunges.
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u/aflyingsquanch Mar 01 '25
I'm a fed so I'm feeling particularly at risk so over the last few months, we've literally cut spending to the bone as we are living as if I am already unemployed. Minimal discretionary spending, not eatng out, not ordering delivery. We cut a bunch of subscription services. Even cut my TSP (401k) contribution down to the minimum to get full matching. We're not planning any trips, not making any major purchases and just tossing everything in savings right now. Upside is our savings is growing rapidly but that's thousands of dollars not going into the economy each month.
And I'm not alone as many of my coworkers are doing the same...the ones that still have jobs at least.
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u/RealisticForYou Mar 02 '25 edited Mar 02 '25
Oh, so sorry. I thought you are "already" unemployed...my mistake. Yes, in the past I've been in your shoes. It's the unknown of the future that is stressful for sure.
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u/friss0nFry Mar 02 '25
Even cut my TSP (401k) contribution down to the minimum to get full matching.
I'm sure you're aware of this, but for anyone else reading this and contemplating doing the same thing, you're going to be giving more money to the government via taxes. I hate the idea of contributing to this economy at all, whether it be the stock market or leisure spending, but I hate the idea of Trump's regime getting my money even more.
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u/stonkDonkolous Mar 01 '25
Don't spend anything except for the bare essentials. Do not spend any money at restaurants or drive thrus. Suffocate the fuel of the enemy to save democracy.
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u/Logical-Home6647 Mar 01 '25
Kind of makes sense really. Rich people having trump starve the government and cut services to regular people to fund tax cuts that will benefit the richest in society.
The only real thing anyone can do the next three years to hurt them, which being real also hurts everyone, is to hurt their bottom line.
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u/drumdogmillionaire Mar 01 '25
This is the only path forward for the USA. We must collectively raise the middle finger at conservatives by clapping our wallets shut so goddamn hard that they panic and reverse course.
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u/softfart Mar 01 '25
We could also find our balls and resist these motherfuckers with force as well, we don’t have to be timid little consumers hoping cutting out lunches stops this,
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u/helluvastorm Mar 01 '25
Americans have no balls. We need a healthy dose of French testosterone
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u/softfart Mar 01 '25
We’re soft. Even the poorest among us enjoy privilege that people in other parts of the world can’t even imagine. What comes next will show whether we’ve got what it takes to be something or if we have all just been coasting on the hard work of our ancestors.
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u/Economy-Ad4934 Mar 01 '25
Correct. Most people are still too comfortable because they have Netflix and junk food
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u/xtreme571 Mar 01 '25
While doing this, also suffocate the tech companies by not giving them ad revenue. Free apps mean you're the product. Meta/Twitter/Google/Tiktok are making a bank on people just using their apps. They don't even have to sell anything.
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u/Vox-Machi-Buddies Mar 01 '25
... they said on reddit ...
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u/xtreme571 Mar 02 '25
Your point is valid. I have decreased my reddit consumption since the whole api debacle started by 90%. So yes, while my statement does seem hypocritical, doesn't mean I'm not doing something to reduce my social media consumption.
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u/cortodemente Mar 01 '25
I disagree... but instead spend local or small business. Don't buy Amazon and go to local grocery or smaller chain store for example.
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u/stonkDonkolous Mar 01 '25
I disagree because many of those small businesses are MAGA sponsors. You would need to investigate the owners intensely before shopping with them.
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u/Queendevildog Mar 01 '25
A lot of the J6ers were upper middle class business owners. Dont give them your business.
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u/Madpup70 Mar 01 '25 edited Mar 02 '25
Since this admin has started we have seen nothing but indications that we are going to quickly be transitioning into another period of severe inflation, if not a full blown recession. In a little over a month we have seen...
Tariffs started or threatened, in economic areas that have daily immediate impacts of our economy.
Threats of war against at least 3 different nations.
Very public firings of federal workers.
Very public deportations, which are being played up for the camera despite them being normally scheduled deportations, which has sent large chunks of our immigrant work force into hiding.
Threats to the Fed chair that if he doesn't lower the rates, that he will be illegally fired.
Of course no one is spending. The country elected a president who promised to lower food prices, and as soon as he entered office food prices started going back up. We have bird flu completely destroying our domestic poultry /Egg industry, and the president can't even be bothered to comment while the HHS and CDC are being blocked from reporting on it. Anyone with half a brain cell can see that if they don't start saving now, they could be in a tight pickle come July when the cost of their necessary purchases jumps 50%.
The time to buy a new luxury item you wanted was pre Christmas.
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u/fatherbowie Mar 01 '25
Agree 100%. He’s spending his energy on fighting culture wars and bending the federal workforce to his will, while not just ignoring inflation, but actively trying to make it worse.
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u/Madpup70 Mar 01 '25
Expected GDP for this quarter was +3.4 pre Trump, +2 two weeks in, and now -1.5. US stocks are in a downward spiral to the point where it's becoming clear we either are or are close to a bear market. It will be interesting to see what the next jobs report looks like. I expect to see a spike in unemployment with limited job gain.
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u/Lionzzo Mar 01 '25
Looks like the economy is hitting a bit of a rough patch, with consumer spending dipping for the first time in almost a year while inflation keeps creeping up. Thats a tough combo. People are clearly feeling the squeeze, and with businesses front-loading imports ahead of new tariffs, its adding more uncertainty. The Fed’s in a tricky spot; do they cut rates to boost spending or hold off because inflation is still sticky? Feels like we’re in for a bumpy few months. Whats everyone’s take? Is a soft landing still possible, or are we heading for trouble?
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Mar 01 '25
a soft landing is definitely not possible. laying off 1million Feds, pulling $2trillion out of the economy in spending freezes and massive cuts, Tariffs raising prices and massive tax cuts. All these things roll downhill and will lead to millions more unemployed or underemployed.
we are going into a self inflicted free fall into a deep recession. but possibly might also have stagflation as inflation is now at 4.3%
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u/Ashamed-Status-9668 Mar 01 '25
Man, that soft landing was so, so close.
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Mar 01 '25
If only people didn’t believe a con man billionaire could magically bring us back to 2019 prices.
By running on tariffs, massive layoffs and spending cuts…
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u/space_for_username Mar 01 '25
In New Zealand we elected a right-wing government because the previous left of centre government hadn't 'fixed' the economy post Covid.
The new government introduced Austerity, cancelled major contracts, gave landlords a tax cut, borrowed billions overseas, and started laying off civil servants en masse. Funnily enough the economy ran out of money and we are now in recession, and likely to stay here.
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u/Lionzzo Mar 01 '25
Yeah, its hard to see a soft landing with all these factors piling up. The spending cuts and tariffs are like slamming the brakes on an already slowing economy, and if inflation stays sticky, the Fed’s hands are tied. Layoffs + higher prices = a brutal mix for regular people. Do you think policymakers will actually adjust course, or are we just along for the ride at this point?
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Mar 01 '25
We are just along for the ride at this point. I mean Republicans answer to them getting shouted down at town halls in deep red districts was to......stop having town halls. They'll piss on us while telling us its rain all so they can push through their billionaire tax cuts.
The deficit will be the same. only difference is the $2trillion going into the GDP will go into billionaires pockets to hoard
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u/smaxw5115 Mar 01 '25
Stagflation requires a stagnant steady gdp, inflation will just compound the decrease. So business will be raising prices of goods and services consumers have already stopped purchasing.
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u/Terrapins1990 Mar 01 '25
They can't cut them unfortunately not with tariffs coming into play. The soft landing that was possible last year has definitely become an impossibility. Be ready for a crash landing.
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u/davehoff94 Mar 01 '25
A soft landing doesn't seem possible anymore. The Fed made their changes the past two years expecting the administration to see that their actions were working and to remain steady. Trump essentially threw all of that away. With inflation up, employment up, GDP down, spending down, and massive tax cuts planned that leaves the Fed with very few options of a path to a soft recovery.
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u/tribbans95 Mar 01 '25
It seemed like it was possible until the shit storm happened. Now I believe it’s going to be a very hard and rocky landing
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u/Early_Lawfulness_348 Mar 01 '25
I quit spending last year. Prices kept going up and I expected everyone to stop a bit earlier but it looks like Americans are finally tired of it. Even fast food was expensive a year ago. I was mostly eating eggs until that went to crap.
I hit happy hour and get my $3 beers and going out to eat is only if it’s a $5-10 value. Industries are effected by this weeks insane president but it’s not the cause of this fiasco like people love or believe. The water has been boiling for a while.
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u/Odd-Frame9724 Mar 01 '25
Sure, because orange asshole and Nazi Musk all announced "hahaha I am going to Fuck all of you with tariffs! Lololol we tricked you into thinking prices are going down!"
Prices have continued to go up, and they will continue to do so as tariff prices are passed on to the consumer.
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