One of the reasons that American consumers  are spending less is they feel a great sense of insecurity about the economic situation. Jobs are vanishing every day and those who are still working are wondering when they will have their job taken from them. The latest economic reports out this week do not help. I would be nice if business would forget what is now history (those reports) and make an effort to be optimistic about what is ahead. It is a vicious circle, jobs lost mean less consumer spending, means jobs lost, etc. Wake up and smell the coffee!!

What do they expect from us? Most of us are broke from the gas prices we had to pay all summer long, and now we are looking in the face of heating our homes and those of us that heat with gas, propane or fuel oil are really concerned about those prices also. It takes all of my checks to buy groceries and pay bills, and I work 2 jobs. The economy is terrible, apparently this is how we are suppost to be living, BROKE.

clothing sales are down, no shocker there.

everything out is ugly ugly ugly.

I can't even spend money if I want to

In addition to CEO's like Fuld (Lehman Bros), we should also prosecute journalists that shout "Sept sales fell like a thud, down 1.2%.....) Irresponsible journalism is largely responsible for the stock market crash.

What the hell does 1.2% mean in the overall scheme of things.  August was the month parents were spending the remainder of their funds - after $4.00 gasoline in July - to send their kids back to school in September.  Also, in September, it was hot! Hot! HOT! here in Pennsylvania, and I certainly didn't think about going to the mall to get COOL!!!

We, at the same time, have bankers (Advanta, BAC, Capital One, among others) raising credit card rates from 8% to 26%.  I'd like Ken Lewis' (BAC)explanation how tripling card rates is going to help the overall economy.  That is, beyond the card companies own short-sighted gains(?).

I am offended by the Title "The Failure of the American Consumer".  Yes many of us failed to follow a simple principle of don't spend what you don't have.  However, the American public has not been manipulated to this great exent ever to make a few immoral individuals in "Government and Wall Street" rich.  The American consumer is doing what they need to for this country to survive for another 200 years, live with in a Budget.  And don't believe the hype.   It is more like the "Failure of Ethics and Morals in Government and Wall Street".  

Most Americans are being thrifty because that is what the media is preaching. Don't drive your car. Don't eat out. Grow your own gardens. All not bad ideas...but...fewer cars sold means fewer jobs in the car industry. Fewer meals out means fewer jobs in the food industry. Fewer grocery store jobs. Fewer truck drivers. Fewer taxes collected from taxpayers means fewer teachers. A vicious cycle that can't be broken until somebody starts spending some money. People won't spend while they fear that they are about to lose what little they have left.

Incentives to the manufacturing industry and small business are the only solution to getting this country back on track...not higher taxes.

the title of this article is the problem.  the american consumer hasn't failed, unless you consider our only purpose is to buy stuff.  the real failure is on businesses who pay their employees like paupers, then expect them to spend more than they earn to keep those businesses afloat.  this is the awakening of the american consumer.

I know no one that matters read this at all, not one of the Wealthy (not rich, but wealthy) the reason this is happening and will continue to happen is this, the American Consumer is fed up, broke, and needs a lift. But instead they will put an infusion into the Wealthy peoples pockets again. If they listen to the correct plan that money would go to tax paying hard working americans, that are not on welfare, that make less than 130k or less a year, and have shown income for at least 5years and have had credit those five years. (more stipulations) but what should be done is they give the money to pay all debts off of these Americans, since they are the consumers, the banks will get the money, the car people will get the money, and the list goes on. Think about it, Wealthy people do not spend money in America like the average person, they hardly ever even spend money at Wal-Mart or buy normal cars, plus they made money off of hard working people for so many years I feel they don't desirve it. If everything is paid, you know these same people will go buy new cars, clothes, things they need for the house etc. this would bring the econmy back, people would be happier, but I like the rest try not to spend a dime, I am tired of hearing some sob got 400million dollars to make a company fail, this guy never did any hard labor he got the job because he was from a Wealthy family and they have connections, and he plays golf, what the is wrong with our Country, and I spent almost 20 years in the USMC fighting for these SOB's. I wish I would have stayed in, now they want to increase the consumers credit payment by 2 so now us poor slobs will never have any money, I think they are trying to make us surfs again.

it's kinda stupid if you ask me.  

I completely agree with Bevan Clarke's comments  It is important to understand that we have a credit crisis and not a liquidity or spending crisis.  We have a credit crisis, not because the banks do not trust individuals, but because there has been widespread fraud within the banking industry and on wall street regarding mortgage lending such that the banks will no longer lend TO EACH OTHER.  They know that many of the mortgages are bad paper, but they don't know who is holding the bad paper.  People exploited the ability to create highly leveraged securitized instruments that did not fall under securities or insurance regulatory laws, and then knowingly allowed homes to be valued above market prices, with or without owner occupancy...  this was NO ACCIDENT.  People got rich in the process, and now we must ensure that the guilty are properly identified and punished.

The banks know the problem is deep and wide, because they were themselves participants in the fraud, to such a wide and deep extent that the banking system is in danger of collapse.

It is offensive (and frankly foolish) to label this a failure of the consumer.  Many consumers will be left with negative equity in their homes and will wind up paying for the problem in the end, one way or another.