This is all it takes for things to be set right:

What investors are going to be looking for in this week's data are signals that the consumer is still able to spend despite higher commodities costs.

For the past five years or so, borrowing against inflated house prices was the source of spending money. That's gone. Plain old (credit-card) borrowing isn't sustainable. That leaves wage growth. But there hasn't been any. The productivity gains for the last 30 years have accrued to corporations, not to labor.

Investors are looking for a free-spending consumer that doesn't exist any more.


posted by Quiddity at 6/08/2008 10:32:00 PM