Recession Has Hit Real Incomes, Spending Will Come Next

Consumer spending is set to take a step back

Highlights

• This was never the beginning of a new bull market and, in fact, the opposite looks to be happening... flipping to “extreme fear” from “extreme greed”

• Adding to the poor equity environment is the fact that the equity risk premium has collapsed to the lowest levels since the dotcom crash

• Consumer spending is set to take a step back as its key support, real after-tax incomes, heads to a recessionary backdrop

• Food prices are starting to ease globally in an added sign that inflationary pressures are beginning to disperse