Bangkok--28 Oct--Standard & Poor's
With unemployment still lingering around 10%, retailers are rightly concerned about consumers' willingness to spend.
"Even those who are working will probably slip more dollars into their mattresses than are likely to end up in cash registers at the shopping mall," noted Standard & Poor's Director Beth Ann Bovino. "Those mattresses are getting thicker than they've been in a while."
The personal savings rate has been above 5% for the seven quarters ended with second-quarter 2010, after peaking at 7.2% in second-quarter 2009. In contrast, back in 2005, the saving rate was as low as 1.2%. In fact, household debt as a percentage of after-tax income reached a record 135% in the second half of 2007, which meant that consumers not only spent their last dime--they borrowed so they could spend more.
Standard & Poor's Ratings Services has published a special report on this trend of lagging consumer confidence in the wake of the Great Recession, which will be compiled in the Nov. 3, 2010 edition of CreditWeek. The special report consists of five articles, titled:
"A Jobless Recovery Is A Drag On Consumer Spending," "No Quick Fixes Are In Sight For High U.S. Unemployment," "U.S. Industries That Depend On Consumers Struggle As Unemployment Persists And Buyers' Confidence Seesaws," "Standard & Poor's Anticipates A Modestly Happier Holiday Season For U.S. Retailers," and "U.S. Apparel And Retail Companies Still Face Wary Consumers"The reports are available to RatingsDirect subscribers on the Global Credit Portal at www.globalcreditportal.com and RatingsDirect subscribers at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase copies of these reports by calling (1) 212-438-7280 or sending an e-mail to
[email protected]. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request copies of these reports by contacting the media representative provided.
Media Contact:
Mimi Barker, New York (1) 212-438-5054,
[email protected]
Analyst Contact:
Beth Ann Bovino, New York (1) 212-438-1652