Symptoms of a collapse in consumer spending include four successive quarters of declining per capita retail sales volume, to the September 2019 quarter. Declining new vehicle sales to private buyers for nearly two years to October provides confirmation of the breadth of the slump.
The recent cuts in interest rates, boosted personal income tax returns, and lower income tax rates have had no measurable impact on consumer spending so far.
Causes of this damaging slump are easily identified: low income growth and a fall in residential property prices. There are, however, several causes of low income growth and these are identified in this report.
My report identifies the characteristics of those consumers who are most willing to spend. These have been deserted by recent monetary and fiscal policy and should be the targets of immediate stimulus. The forms this remedy should take are described and an implementation strategy is outlined.
My report uses proprietary consumer tracking data which measures consumer willingness to spend by demographic.
Industries exposed to consumer spending have an interest in understanding how to stimulate spending and recommending our strategy proposals to the Treasurer and the Governor of the Reserve Bank before they make any more mistakes. Industries which would benefit include retailers and their suppliers, service industries, media companies, and media agencies.
My report is available at www.foreseechange.com.au