Why does retail spending and consumer confidence coincide?
I was reading an article about consumer spending through the previous holiday season. They refer to people opening their wallets up more. Why does societal confidence have to be connected with spending?
Consumer confidence refers to people’s opinions about whether the economy in general and their personal finances will be better or worse in the future. When people are feeling optimistic that they have a good financial future, they are willing to spend money. When they think the future may be bad, for example, if they feel that they may lose their job, they save money and don’t spend it.
Well, if you think the economy is going down the drain and you might be out of work soon, are you going to spend or save your money?
If you are 100% sure your job is safe and money is not going to be worthless, then are you likely to buy the things you want, or hoard your money for a rainy day?
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Consumer confidence refers to people’s opinions about whether the economy in general and their personal finances will be better or worse in the future. When people are feeling optimistic that they have a good financial future, they are willing to spend money. When they think the future may be bad, for example, if they feel that they may lose their job, they save money and don’t spend it.
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