Frantic Market Can Make For Jittery Consumers After the downgrade of Treasury securities by Standard & Poor's, consumers might be less likely to buy a home, car or other big-ticket item if they believe the economy is going south.
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Frantic Market Can Make For Jittery Consumers

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Frantic Market Can Make For Jittery Consumers

Frantic Market Can Make For Jittery Consumers

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The world markets and Washington are still digesting Standard & Poor's downgrade of U.S. government credit worthiness. And a volatile stock market has people worried. That's leaving many consumers wondering whether they should buy big ticket items such as cars. NPR's Sonari Glinton reports.�

SONARI GLINTON: Even as the stock market suffers through fits and falls, people are visiting car dealerships. At a Lincoln and Volvo dealership in Southeast Michigan, Jack Myers is standing in front of his gigantic black Chevy pickup. He's trading it in.

Mr. JACK MYERS: Well, this is eating gas, this truck. And we want something more economical. We're purchasing a hybrid.

GLINTON: Even though the price of gas has been going down, Myers doesn't expect it to stay that way. Also, he and his wife Nancy say they should've bought a new car in '07 or '08, but that was when the�economy was tanking.

Mr. MYERS: This is getting old also. It's an '02.

Ms. MYERS: We also started this deal back in May. So the car is ready to pick up today, despite what's happening.

GLINTON: The Myers are paying close attention to the stock market and the S&P downgrade.

Ms. MYERS: Now we're committed. We're going to have to - we're going to buy it today. But if we were going to come in today to buy a new car, to start the whole thing, we would probably wait awhile to see what shakes out.

GLINTON: Back home the Myers have another 10-year-old car, but that one is going to stay in the garage a little longer, at least until the economy settles down.

Mr. DAN TOSHACH: Looking for something used with good gas mileage basically.

GLINTON: Dan Toshach stopped at a Honda dealership. His car has more than 200,000 miles. He says right now he's not too concerned about what's going on in Washington or on the stock market.

Mr. TOSHACH: It's always a rollercoaster. I'm hoping that it turns around, but if it doesn't, then as long as I get a car payment that I can deal with, then I deal with it.

GLINTON: You're not frightened away from coming to a dealership?

Mr. TOSHACH: No, not today any more than any other day.

GLINTON: The S&P downgrade doesn't directly affect the interest rate on the loans these people would be taking out, but it does affect the overall car shopping vibe.�

Jesse Toprak is an analyst with�He says one of the things that directly affects car sales and other spending is the Dow Jones Industrial Average.

Mr. JESSE TOPRAK (Analyst, So what happens when consumers turn their TV on and�see how the market is reacting really determines what - whether they buy or not or what they buy.

GLINTON: Toprak says whether you're an investor or not, people get their cues from Wall Street.

Mr. TOPRAK: But when they flip these channels on and they see the stock market is up or down, it's almost like a green arrow or red arrow for spending.

GLINTON: Hello. How are you doing?

Mr. JOE SESI (Car Dealership Owner) Good. How are you doing?

GLINTON: I'm doing all right.

Mr. SESI: What's going on?

GLINTON: Joe Sesi owns the dealership where the Myers were buying their car. Sesi is about a Main Street as Main Street gets - tall, white hair, mild mannered. He walks and talks deliberately.

Mr. SESI: You know, we've been through this process now in the Midwest. We've been in the epicenter of this economic tsunami now for three years, and we've survived. And so we'll survive this one too.

GLINTON: Still, he's angry - actually very angry at�leadership in Washington.

Mr. SESI: They've been less than a positive contributor. You know, we had a recovery going and they just kind of squandered it again.

GLINTON: But Sesi's anger doesn't mean he's lost hope. He still believes the economy will get better by this fall. His feeling about Washington is another story. That, he says, is going to take a whole lot longer.

Sonari Glinton, NPR News.

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