Tax Reform in This Election Year: It's Not Likely
Which Credit Card Rewards Does the IRS Care About?The Wall Street Journal [subscription required] suggests that the 70% of economic growth that's driven by consumer spending is shifting into reverse. High, middle, and low income consumers are cutting back their spending. Lower and middle income consumers are selling their gold and using pawnshops to pay their bills as food and energy prices hit record levels. Investors should consider whether to sell their stocks or hold on and suffer.
High income consumers hit. Companies that serve higher income consumers are losing altitude, including:
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Tiffany & Co. (NYSE: TIF) said that its U.S. sales slumped during the holiday period.
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American Express Co. (NYSE: AXP) warned of rising delinquencies and slowing spending among its cardholders.
Lower and middle income spending down. Less surprisingly, retailers to lower and middle income people are also suffering. These include:
Goldman Earnings Sink After Buffett Dividend
Johnson & Johnson's Income Falls 23%
Burberry Shares Leap on Sales Update
