Consumer confidence has taken a hit for the second month in a row. This is not particularly good news on the corporate finance front. With consumers not terribly confident about the economy, it means that they are less likely to spend money. This means that the cash flow into many companies is likely to remain low.
The consumer confidence data is also having an effect on how companies view the possibility of a rebound in spending for the holidays. Many businesses have been hoping that holiday shopping would help get things going. However, with consumers still wary about economic recovery, it …read more

The National Retail Federation has issued a prediction that may not come as a surprise to many struggling retailers and cash-strapped consumers: holiday retail industry sales will decline this year for a second year in a row. According to the NRF, consumer fears over job security and home values are the main forces that will drive down consumer spending this year.
The trade group’s forecast predicts that sales in the months of November and December will decline about 1 percent from 2008 to $437.6 billion, which would still be a significant improvement over last year’s decline of 3.4 percent. However, these …read more

Retail sales increased in August, and Ben Bernanke thinks the recession has come to an end. However, economic recovery is still expected to be a long, slow road.

Consumer sentiment is making marked improvements. Does this mean businesses could see more income soon?

Procter & Gamble has experienced a general decline in sales since the onset of the recession as consumer spending falls along with sagging wages and rising unemployment. However, the household goods giant has stated that it expects its sales to recover throughout the fall as the company lowers prices and introduces more value brands.
 
After P&G released its predictions, its shares rose 4.2 percent, or $2.28, landing at $56.04. The company has told investors that it expects its prescription drug business to bring in 32 to 34 cents per share in profits this fiscal year, as well as a 1 to …read more

According to the American Automobile Association, Labor Day weekend will see less people travelling out of their hometown overall, and those who do are more likely to drive to a destination closer to home than usual. Despite the fact that gas prices are $1 less expensive than where they were last year, the number of driving travelers is down 13 percent.
 
With unemployment reaching record levels and wages down across the board, those who travel are more likely to spend much less money than they would in prime economic conditions for obvious reasons. Souvenir and gift shops will suffer, as will …read more

According to recently released data from the Commerce Department and the Reuters/ University of Michigan Surveys, consumer spending rose slightly in July thanks to the government’s Cash for Clunkers program. However, the same data also showed a slight decrease in consumer sentiment, highlighting the pressure from falling wages and rising unemployment.
 
The Commerce Department reports that consumer spending rose 0.2 percent in July off of strong auto sales, a number that gelled with analyst expectations and gave support to the theory that consumers are willing to spend money if the right incentives are introduced. Analysts worry, though, that the increase in …read more

Personal income flat, but consumer spending increases.

Everyone likes a good profit story. And Intel is providing one. As the Dow and the S&P 500 head lower this morning, Intel has the Nasdaq hanging on in the black. Intel announced that its forecast for third-quarter revenue beats the Wall Street expectations. This is a sign that things are improving for the large chip maker, and it could mean that the technology sector is ready to move out of its slump.
Technology is one of those things hit hard by drops in consumer spending. When consumers are not confident about the economy, they often decide that technology projects are …read more

Recently, some sectors have been benefiting from economic stimulus efforts. The housing and automobile industries have been the main recipients of economic stimulus money, and programs from tax credits for first time homebuyers to Cash for Clunkers have been helping demand. However, with economic stimulus programs coming to an end, it looks as though supply and demand could make a comeback.
This has been one of the worries for the economy. As stimulus efforts come to a close, it will become increasingly difficult to keep things running for some businesses. Additionally, banks have started lending a little bit more. But what …read more