The economy is expected to see a “very difficult” season, according to one industry analyst, a year after the Inflation Reduction Act was approved since inflation is still high.
According to former Toys “R” Us CEO Gerald Storch, “when that comes this fall, I believe it’s going to be a very difficult holiday season, certainly challenging for most retailers.” Storch explained how multiple reports from merchants point to a change in customer behavior on “Cavuto: Coast to Coast” on Wednesday.
While consumers are still spending money on services, including some of that pandemic retaliation, according to every report from retailers, sales of tangible goods have fallen for 11 straight months when inflation is taken into account, according to Storch.
According to predictions, the consumer price index (CPI) for July increased by 0.2% from the prior month last week. Prices increased 3.2% compared to the same period last year, up from 3% in June but slightly less than the 3.3% economists’ projection from Refinitiv.
It represented the headline figure’s first increase in more than a year, highlighting the difficulty of controlling rising inflation.
Voices of Concern
During the conversation with Storch, Pulte Capital CEO Bill Pulte observed, “It’s far from solved.” We see the needs of the American people every day on Twitter, now X, and I can tell you that people are struggling more than ever to meet shelter costs and medical costs.
I think we’re in the first inning of a stagflation period right now, where you basically have low growth and a lot of inflation.
Consumers are also dealing with other economic stressors, Storch noted, in addition to persistent inflation. Consumers are not only dealing with inflation, but they also have to pay rising interest rates whenever they purchase capital goods, such as a car or a home.
In addition, credit card debt is rising, indicating that more people are using very high-interest credit cards. And by the way, as rates rise, the credit card debt rate also rises. As a result, they are using the most expensive capital available to purchase the things they need in their lives. And finally, we’re facing inflation.”
Source: FOX BUSINESS