First, because consumer expectations for the future just hit a thirty one year low, and second, because this fear is justified, because this feeling is an accurate reflection of a reality where your net worth is falling:

Consumer sentiment inched up in early September, but Americans remained gloomy about the future with a gauge of expectations falling to the lowest level since 1980, a survey released Friday showed.

The Thomson Reuters/University of Michigan’s preliminary reading on the overall index on consumer sentiment edged up to 57.8 from 55.7 the month before, which had been the lowest level since November 2008. It topped the median forecast of 56.5 among economists polled by Reuters.

“Overall, the data indicate that a renewed downturn in consumer spending is as likely as not in the year ahead,” survey director Richard Curtin said in a statement.

“Even without a downturn, consumer spending will not be strong enough to enable the rapid job growth that is needed to offset reduced long-term expectations.”

The gauge of consumer expectations dipped to 47.0 from 47.4. It was the lowest level since May 1980. The economic outlook for the next 12 months fell to 38 from 40, the lowest since February 2009 when the world economy was gripped by the credit crisis.

…………

It’s understandable if Americans feel poorer. It’s because they are.

The net worth of American households decreased nearly 0.3% in the second quarter as the value of their homes and stock portfolios slumped, according to data released Friday by the Federal Reserve.

Household wealth fell to $58.5 trillion, as home values skidded 0.5% and financial assets, including stock holdings, slipped 0.3%.

And consumers’ balance sheets may get worse before they get better, courtesy of declining stock prices over the past three months.

Half measures, and a fetish with punitive austerity do not make for either a recovery or consumer confidence.