Rising wages coupled with low inflation have resulted in increased purchasing power. The growth of the U.S. stock market represents added wealth that consumers want to spend. Consumer spending has grown at an annual rate of 5 percent for the last 1.5 years, or about double the pace of previous years. Consumers are spending this newfound wealth on cars, homes, eating out, etc. Since consumers purchase two-thirds of all goods and services in the economy, consumer spending greatly influences the economy's direction.
Consumer spending is so high that it is actually outpacing consumer's gain in income.
As a result, consumers are actually consuming savings in order to maintain their current spending habits. Increased spending has resulted in a negative 1.1 percent savings rate. Apparently, consumers are feeling the stock market wealth and have decided to spend some of it. I suspect that as long as the stock market is strong, consumers will continue to spend. If and when consumers should stop spending, the economy would slow immediately.