"A recent New York Times headline read:
“Consumers Increase Savings While Spending Less”
That sounds like a GOOD thing doesn’t it?
It used to be that savings and thrift were basic, core, American values. Check out Tom Brokaw’s the Greatest Generation if you can’t remember a time when Americans valued thrift and savings. The media is so focused on “reviving” the economy that it is now seen as a negative sign when saving increases and spending declines. I know the economy as we have known it over the last 10-20 years depended on consumer spending, but the problem was THAT WAS MONEY WE DID NOT HAVE!"
There's a few more paragraphs, I recommend reading it.
Via Seattle Bubble who further comment:
Over the last few decades, we have constructed a sham economy that was not sustainable.
When the pyramid scheme failed (as all such schemes are destined to do eventually), rather than the healthy response of “whoops that was stupid, now let’s rebuild a sustainable, sound economy,” we’re hearing nonsense like “we need to prop up housing prices” and “we need to spur more consumer spending.”
Let’s put a stop to the delusion that things can just magically go back to the way they were when everybody (individuals and corporations alike) was hopped up on leverage. It’s not going to happen, nor should it.
Falling home prices and consumer spending are the necessary medicine that must be taken to return to a fundamentally sound and sustainable economy.