You’ll be sure to here some trumpeting of our strong economy and the increase in consumer spending (as the dollar slides, mind you), and why it’s a good thing, but one most carefully parse the details to ascertain the real picture:
Private builders ramped up spending on a wide variety of projects in
March, including residential construction and factories. The government
also spent more on big public works projects, including power plants.In a separate report from the department, consumer spending rose 0.6
percent in March, an improvement from the 0.2 percent increase
registered in February. Consumer spending plays a key role in shaping
overall economic activity.Incomes, the fuel for future spending,
advanced by 0.8 percent in March. That was up from a 0.3 percent
increase in February and marked the largest gain since September.Income includes government payments as well as wages. Payments
from the new Medicare prescription drug plan had the effect of helping
to boost overall income in March. Wages, meanwhile, grew by a moderate
0.4 percent for the second month in a row.
And, the qualifier:
The spending and income figures are not adjusted for inflation.
When adjusted for inflation, consumer spending looked more subdued, rising by 0.2 percent in both February and March.
