Evidence shows economy is close to a turnaround - 13 WTHR Indianapolis

Evidence shows economy is close to a turnaround

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Consumers are still holding on to their money, but the economy may be turning around. Consumers are still holding on to their money, but the economy may be turning around.
USA Today is predicting an end to the recession starting in September. USA Today is predicting an end to the recession starting in September.

Rich Van Wyk/Eyewitness News

Indianapolis - There's new evidence that the economy is getting much closer to a turnaround. One economic outlook index indicates the recession is likely to end in September with a mild recovery starting in October.

Retail spending inched up a half-percent in May, the biggest increase in four months. Auto sales also improved a modest half-percent, though they are still down 20 percent from last year at this time. While unemployment remains at a 25-year high, the number of new jobless claims fell by 24,000 last week.

All are small signs of an economic revival.

"They don't sound encouraging, but they are," said Chuck Williams, Dean of Butler University's College of Business. "We've seen three weeks of smaller unemployment claims. If that holds, that usually is a very good indicator that we are reaching the bottom."

Some economic analysts are now downright bullish. USA Today boldly predicts the recession will likely end in September, saying seven of 11 economic indicators are looking good.

But no one expects the economy to come roaring back. Consumers, the key to any recovery, are still tight-fisted with their money. Meijer is among the retailers faring better than most.

"We are seeing a little bit of a slowdown in our summer goods. Fortunately for us, it's been offset by increases in the supermarket side of the store," said store director Dave Poletti.

Amy Shabluk and her husband have two small children and are trying to cut costs.

"We get our coupons out and spend what we need. We don't get extras anymore," Shabluk said.

"I keep seeing the job losses, you know, bankruptcies with GM and Chrysler," said retiree Keith Higgins.

Having lost jobs, homes and savings to the recession, consumers are understandably cautious.

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