Consumer Spending Drop Largest Since 2001

WASHINGTON -- As the financial crisis was gaining force, Americans cut back on their spending in October by the largest amount since the 2001 terrorist attacks.

The Commerce Department reported Wednesday that consumer spending plunged by 1% last month, even worse than the 0.9% decline that had been expected.

It says personal incomes were up 0.3% last month, slightly better than the 0.1% gain analysts had expected.

The big decline in spending in October underscores concerns that the economy is falling into a deep recession. Consumer spending accounts for two-thirds of total economic activity. ...