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National Survey Shows Main Street Never Bought Talk of U.S. Recovery
added: 2011-09-15

Raddon Financial Group (RFG), a provider of research-based solutions to financial institutions and a strategic business unit of Open Solutions Inc.®, has found that while Wall Street cheered early reports the recession had ended, Main Street Americans didn’t believe the news. The shaky recovery is now giving way to fears of a double dip recession, and an RFG report titled Wall Street Learns What Main Street Knew All Along shows most Americans don’t expect improvement in the next six months.

“With a majority of U.S. households saying they see no evidence the recession is over, I sometimes wonder if Wall Street and Main Street are living in the same universe,” said Louis Hernandez, Jr., Chairman and CEO of Open Solutions Inc., who commissioned and co-authored the survey.

“American jobs have not become more plentiful or secure and the economy hasn’t suddenly shifted into high gear. For most Main Street Americans, only the headlines have changed,” continued Hernandez.

Survey highlights include:

- 62% of respondents see no evidence the recession is over; 23% expect things to get worse.

- 59% of consumers don’t see their personal financial situation improving in the next six months; 15% feel they will be worse off.

- 55% of respondents have been directly impacted by the recession in the form of job loss, reduced hours and/or reduced benefits.

- 57% of consumers are spending less this year than last year.

The ongoing malaise among consumers is dampening their enthusiasm to borrow and spend, activities that are essential for economic growth. High unemployment and economic uncertainty have ushered in a period of fear and frugality, and small businesses are feeling the impact. In its spring 2011 survey, RFG found a majority of small business owners predicting 2011 sales to be as bad as or worse than 2010, a year that had already seen depressed revenue streams.

The survey revealed continuing public anger over TARP bailouts with half of all households saying they are less likely to use a big bank because of the bailouts. There is a bright spot in this survey for community based financial institutions. Consumers were more likely to say their local bank or credit union was “extremely or somewhat supportive” during the recession; big bank users were less likely to have that opinion. Consumers and small businesses also agreed overwhelmingly that smaller institutions offer more personalized service than big banks.

“Community institutions have provided good support to small businesses and consumers. Local banks and credit unions are the lifeblood of every community in this country, and they are in a strong position to satisfy the borrowing needs of small businesses,” stated Bill Handel, vice president of research and product development of Raddon Financial Group and co-author of the survey.

Source: Business Wire

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