I don't put breaking in the title, but I think that's breaking news. Tell me if not, and I'll delete. The crisis in Wall Street has indeed hit Main Street, and hard. The AP reports (via MSNBC):
Government data show retail sales fell off a cliff in September, plunging by the largest amount in two years. Worried consumers shunned the malls and auto showrooms in the midst of the country’s financial meltdown.
The Commerce Department reported retail sales decreased 1.2 percent last month, nearly double the 0.7 percent drop that had been expected. The surprise showing significantly increased the risks of a recession. Consumer spending is two-thirds of total economic activity.
More after the fold
The fall in retail sales is directly related to fall in the degree of consumer confidence, as Gallup reports.
Since the start of the financial crisis, the perceived degree of uncertainty about the future of the economy has made consumers hold back in their spending. A fall in spending in turn causes the economy to produce less, and can then deepen the recession. I'm afraid such a large fall in retail sales is a good indicator that the economic situation is gradually deteriorating.
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Bloomberg has the story too:
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Also the Wall Street Journal:
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I will post updates as reactions to the news appear