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Federal Reserve Chairman Ben Bernanke wants you to spend money but Americans are saying no.
His pledge to keep interest rates at record lows is only having the opposite effect on consumers nearly three out of four say they aren't going to -- in today's down economy here to break it down.
Greg McBride senior analyst at Bankrate dot com.
Great great to see you and of course we didn't make this up this is -- actually the result of a survey you dead and I thought this was fascinating.
Three out of four Americans 74%.
Say hey I'm not inclined to borrow money.
Exactly the opposite opposite of what Ben Bernanke is trying to get us to do what -- what's going on there.
All the -- the consumer is still very much in this deleveraging mode consumers are focused on paying down the debt they have.
Not adding to it and your right if that's the last thing Ben Bernanke wanted to hear.
You know what are Americans -- with their bodies say they're paying off debt but what kind of debt.
Well ill they're they're refinancing things like mortgages.
Take advantage -- lower interest rates but paying down things like credit card debt.
Higher interest rate obligations.
Are also focused on boosting their savings people -- that they're behind the eight ball when it comes to emergency savings.
We've found that out in prior months people don't have adequate savings and they know what they.
And so there's a lot of focus on building up that caution.
Yet some people feel better than others that you found a specific group that feels worse than others who -- that.
Well in particular retirees only one -- six retirees the says that their overall financial situation is better today than it was a year ago.
Jerry that's the same reading as the unemployed.
Wow that's unbelievable and of course -- savings doing nothing here they're they're losing ground not gaining ground.
The other thing that's gonna happen this huge fiscal cliff coming were to be seeing our taxes go up up up -- just talk about the payroll tax increase that's coming.
Because both parties embrace this.
What if is could be a double whammy for these people.
Outlook this fiscal clip is no joke.
-- -- this could literally be an instant recession.
If we go over that fiscal -- because up.
But the tax increases that you noted a moment ago but also sharp spending cuts.
So you know this is gonna far outweigh whatever the Fed is doing.
This is going to outweigh the significance of who wins the election the real uncertainty that's holding things back right now is that looming fiscal -- Well that's what we're from CEOs.
People on the street anywhere you go people don't know what to expect -- their really worried about it.
Now the flip side the point -- -- good news in your report you said there are some five components that improved over the past month what are those.
Yeah we did see some improve.
-- actually people's feelings of financial security actually rebounded to the highest level since June.
And a lot of that's because we've seen a better job market news the housing market has turned for the better in the stock market's performed well.
So all told consumers now feeling better.
On four out of the five components in the survey.
With regard to job security people now feel more secure in their jobs and they did a year ago.
Also more people reporting higher net worth than was the case a year ago.
Well I guess we'll just have to keep -- Diana interesting findings -- thanks for coming on today appreciate your tac.
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