Government says consumers feel better about the economy

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by Dave Cassidy, 13News Now

WVEC.com

Posted on July 12, 2013 at 8:10 AM

Updated Friday, Jul 12 at 8:20 AM

WASHINGTON, DC - The government Friday will release the latest information on how Americans feel about the economy.

When the stock market hit a record high Thursday, economists say that's a sign that consumers feel better and spend more.

Shoppers spent 4 percent more in June than they did a year ago.  People with 401-K accounts have more to spend because the stock market's booming. More people are working, too.

The economy's added 200,000 jobs a month so far this year, according to the govertnment, and wages rose 2 percent in June - more than the inlflation rate. So, that's another reason people feel better about the econony than they have in five years - before the crash.

Shoppers also are buying more with credit cards. That's important, economists say, because consumer spending drives 70 percent of the economy.

The last time people starting running up more credit card debt, they started saving less. But this time, Americans asay they're saving more too.

Retail sales last month were the best since January. Shoppers pulled back a bit early this year, but improved consumer confidence is leading to more spending now. And that should be good news going into the back-to-school shopping season - our second-biggest shopping season.

Despite the government's forecast, more Americans still say the country's on the wrong track than the right track. What's changing is the gap between the people who are feel bad and the ones who feel good is getting smaller. Mostly because the wealthiest one-third of the country - feels better about things. Lower income people are not seeing the same benefits from the recovery that wealthier people are.  

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