Businesses Propping Up Economyby Tim Manni
New orders for durable goods, products meant to last three years or more, posted their third consecutive increase in July, raising 1.3%, the same increase reported in June. With consumers holding back from supporting the economic structure, businesses — along with consistently strong exports — have supported the wounded economy recently. Yet, as foreign markets continue to slow, the question is: how long can American exports and business spending prop up the fragile economy? Consumer spending and the housing market will have to improve first and foremost to keep the wheels turning.
The good news is that the housing market began to stabilize in July: existing-home sales rose by 3.1%, lifting annual home sales to the 5 million mark. Single-family home sales rose 2.4% in July as well. Cheaper energy prices were the main cause for consumer confidence to rebound to 56.9 in August, up from a reading of 51.0 in June, the lowest level in 16 years.