D.........Re 'need to go on the road'
Aint that against the law in FL...? <g>
Personal Income Rises in August
The Associated Press
Sep 29 2000 1:12PM ET
WASHINGTON (AP) - Americans' incomes rose solidly in August but their
spending went up faster, pulling the nation's personal savings rate down
to a record monthly low.
The Commerce Department reported Friday that personal income, which
includes wages, interest and government benefits, grew by 0.4 percent
last month, slightly faster than the 0.3 percent rise many analysts were
anticipating.
At the same time, spending rose by a brisk 0.6 percent, a little more than
the 0.5 gain analysts were expecting.
On Wall Street, much of the big stock gains registered Thursday had
evaporated by midday Friday. The Dow Jones industrial average was off
120 points and the Nasdaq index dropped 75 points.
In July, Americans' incomes grew by 0.3 percent but their spending rose
twice as fast, by 0.6 percent.
Disposable income - what is left after taxes - rose in August for the
second straight month by 0.3 percent.
All that spending drove down the personal savings rate - savings as a
percentage of after-tax income - to a negative 0.4 percent in August, an
all-time monthly low since such record keeping began in 1959. July's
savings rate was revised upward from a negative 0.2 percent to zero.
Still, August's rate may not provide a clear picture of savings, economists
have said. That's because the calculation doesn't take into account gains
realized from such things as rising stocks and higher real-estate values.
The Federal Reserve has boosted interest rates six times over the last 15
months to slow economic growth and keep inflation under control. The
Fed's rate increases are designed to make borrowing more expensive
and cool demand for such big-ticket items as cars and homes.
Given signs of moderating growth, economists believe the Fed won't
boost interest rates at its meeting next week or for the rest of this year.
Friday's report showed that spending on durable goods - cars and other
costly manufactured goods expected to last at least three years - grew
by 1.6 percent in August, the fastest pace since a 1.7 percent increase in
February. In July, spending on durable goods rose 0.7 percent.
Spending on nondurable goods, such as food and fuel, rose 0.2 percent
in August, down from a 0.7 percent rise the month before.
Americans' wages grew by a modest 0.3 percent in August, following a
solid 0.5 percent rise in July.
Total income growth last month was dampened in part by the departure
of temporary federal government census workers. Analysts also expected
sluggish job growth in August to temper income growth for the month. |
