The reports only show that we've come down from an irrational exuberance that was never justified by economic reality. Some businesses are dumping inventory, prompting more consumers to look for bargains and to refuse to pay full price for anything. When the economy is in a slump, our business is up. One intriguing paradox is that Americans are being encouraged to spend at the same time fewer Americans are saving. Seventy-four percent of Americans are in debt.
Analysts acknowledge the paradox.
The goal is to help people with few assets move into the mainstream by building wealth, saving for a house, paying a mortgage and building equity. More affluent consumers have less to lose, because they have had more disposable income to spend. Even so, affluent baby boomers are not getting off too easy. A feeling of wealth from investments in a high-rising stock market fueled much spending in the last 10 years. Many boomers substituted the stock market for a savings plan, counting on huge gains to help finance their approaching retirements.