United States prices create 27 years the largest increases in consumption growth has also been consumed

Affected by rising oil prices, the United States in June, personal consumption expenditures price recorded in 1981 to maximum increase; the rise of prices also ate the consumer spending, after inflation, personal expense reduction 0.2%. And pessimism, Ruby, recently renewed warnings, United States economy is in recession in the second round, at the very least will last 18 months.

Personal spending in the United States gross domestic product (GDP) in occupies about 70% in the United States economy in occupies an important position. Although personal expenditure subject to United States earlier this year launched the economic stimulus rebate policies in the effort, but it was swallowed up by inflation, economic access to boost.

(http://finance.) United States Department of Commerce announced on 4 August, 6 month personal consumption expenditures (PCE) price growth 0.8%, as growth in February 1981, 1% maximum increase since. Compared with the same period last year increased 4.1% and after 5 months of 1991. As for the Fed's inflation increase interest preferences reference index, removal of food and energy, the core index 0.3% in June, compared to the 5 month 0.2 percent.

Although growth in consumer spending, but removal 0.6% inflation, reduce 0.2%, showing a higher prices eat consumer spending. In may, consumer spending growth 0.8%; removal of inflation, also still 0.3 percent.

Continued growth in consumer spending depends on the employment situation and personal income. With the United States Government rebate payments reduce the six month personal income only slight increase growth 0.1% 1.8% in May. Most economists and expected economic stimulus tax rebate origination, results in the second half of the year will gradually.

In addition, because of oil, food and chemical products price increase, the United States June factory orders increase 1.7%, an increase since December of last year, higher than the largest Wall Street analysts expected growth 0.7%. But investors affected by inflation data, think consumer pressure to rise.

Report of the United States Government announced last week, the month of July unemployment rate highest in four years, although in the second quarter economic stimulus tax rebate affected 1.9% growth, is still not to expect. Inflation rose, show the Fed monetary policy dilemma. Generally expect the fed to keep interest rates Tuesday meeting will remain unchanged.

But as early as two years ago, warning United States market bubble burst, the United States economy into recession by New York University economist rubbini has again warned that the United States economy is in recession in the second round, at the very least will last up to 18 months. While the United States will have hundreds of bank failures, taxpayers may take up to 2 trillion to rescue the banks.

Ruby, served as United States, former President Bill Clinton's economic adviser, he said that in order to save the United States in the financial services industry, at least to take a United States taxpayer $ 1 trillion, but more likely to need $ 2, 000bn. Real estate bubble will lead to the collapse of Bank one, because it is only in the banking sector of the subprime mortgage loans for asset impairment then also have to face the impact of consumer credit debts, while these banks have no funds to meet such a blow. Ruby, noted, and mortgage-related assets of value to the last may be zero. In such cases, the United States consumer savings and spending will be greatly reduced.

He also criticized the fed in the face of the subprime mortgage crisis has handled poorly, because did not see the subprime mortgage crisis after the disaster that may occur. He said that the local population, housing, shops, commercial real estate for financing community banks will face the collective failure of destiny. He believed that at least half of the Bank will be closed down. As for national banks collapse of some possible, some you may scale the Government "so as to fail" obtained policies.