Confidence isn't some magic elixir for the economy: Businesses will hire and invest only when they see concrete evidence of demand for their products, and consumers intensify their spending only when their incomes justify it.
Something of a non-sequitur, but still yet another stake through the heart of the Voodoo Supply Side Economist.
In my dead-trees version, Irwin shares the bottom of the first Business Section page with Neal Boudette, who introduces us to yet another canary.
Luxury-car makers began to grab an increasing slice of the American car market as baby boomers reached their peak income years and splurged on upscale automobiles. In 2007, they had 11.8 percent of the market, up from about 9 percent in 2001.
You'd think that all those Smartest Guys in the Room would recognize a non-repeatable bump in their demand function based on once-in-a-lifetime (props to the 'Heads) demographics. Perhaps not.
They had some initial success, but many models introduced in the last several years are now floundering. In June, sales of Cadillac's ATS were just 1,185, 37 percent fewer than in the same period a year ago. BMW i3 sales this year have totaled fewer than 3,000 cars, less than half the pace of two years ago. At Mercedes-Benz, sales of the CLA declined 8 percent in June -- and are down 37 percent in the first six months of the year.
Automotive Goodwill Industries might actually exist? They're not used cars, after all. They're Previously Owned Certified Batmobiles.
But more difficulties for the luxury brands may be on the way. Their efforts to sell new cars this year are facing increased competition from used cars that were leased two or three years ago and have been turned in to dealers. Many have been driven fewer than 40,000 miles and sell for about half the price of new models.
Could it be that the ranks of the aspirational 1%-ers are thinning?? Ya think?
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