Economists have been touting consumer strength as the economic recovery has appeared to gain steam in the last few months.
But there’s a good reason to believe this development isn’t all it’s cracked up to be.
According to research from Morgan Stanley global strategist Gerard Minack, the U.S. government is actually “paying out as much in benefits as it receives in taxes from households.”
And analysts already concerned about a fiscal cliff ahead around the start of 2013 when the government dramatically cuts back expenditures, the power of the consumer might be much weaker than the numbers would suggest.
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