The Discover U.S. Spending Monitor fell a record six points in October as consumers continued to fret and disappeared into the lock box. One thing that can always be said about Americans is that we shop through good times and usually through bad. But the economic downturn has so many people worried that people are actually beginning to save money. This is clearly not the American way.
Nearly two out of three consumers (63 percent) now rate the economy as poor and 72 percent think it’s getting worse.
“October’s numbers show consumers clearly are hunkering down to ride out the economic and financial crisis,” said Margo Georgiadis, chief marketing officer of Discover.
Even more telling perhaps is that even while gas prices have fallen, 79 percent of those surveyed said they have not increased their spending in other areas as a result. Upper-income consumers (those who make more than $75,000) also felt the pinch. More than half (51%) are expecting to spend less on discretionary entertainment spending. From September to October, the percentage of those in the upper-income category who thought their financial situation was getting worse went from 40% to 50% surveyed in October.
Whether or not the consumers keep the buying power locked up over the holidays will be a telling sign of how skittish and suddenly save-conscious the U.S. consumer has become.