Retail sales in the U.S. fell in May for a second month, prompting economists to cut forecasts for economic growth as limited job and income gains hold back consumers.
The 0.2 percent decrease matched April’s drop that was previously reported as a gain, Commerce Department figures showed today in Washington. Sales excluding car dealershipsslumped by the most in two years.
The smallest wage gains in a year and unemployment exceeding 8 percent are taking a toll on the consumer spending that accounts for about 70 percent of the economy, leaving it more vulnerable to shocks from the European crisis. Federal Reserve policy makers gather next week to decide whether further stimulus is needed to fuel the three-year-old expansion.
“The consumer is pulling back,” said Michael Brown, an economist at Wells Fargo Securities LLC in Charlotte, North Carolina, who correctly forecast the drop in sales. “There isn’t a lot of job creation. We will continue to see softer numbers.”Gallup reports:
Twenty percent of Americans say they are satisfied with the way things are going in the United States, a slight decline from recent months, when between 24% and 26% were satisfied. Satisfaction has reached as high as 36% during President Obama's first term, before falling back to 11% last August and September.
Low satisfaction ratings are an ominous sign for a president seeking re-election. Today's 20% satisfaction among all Americans is similar to the final ratings prior to the 1980 and 1992 elections, when Jimmy Carter and George H.W. Bush were defeated for re-election. In November 1979 (Gallup did not ask about satisfaction in 1980), 19% of Americans were satisfied with the direction of the country, and in August-September 1992, 22% were.
In contrast, Ronald Reagan (48% in 1984), Bill Clinton (39% in 1996), and George W. Bush (44% in 2004) were re-elected at times when Americans were much more satisfied with national conditions.