I can speak for myself and say that there are purchases and spending I could delay 6 months or a year but can’t put off indefinitely. Low spending generates pent up demand. Non-emergency Car repairs, dental work, new shoes, replacing jeans, and many other expenses fall into the category of essential but not urgent (as opposed to food, gasoline, toilet paper and other urgent expenses). I’m sure most people have put off at least some expenses that have moved from the “essential but not urgent” pile to the “urgent” pile.
Also, consumer sentiment is improving partially because of real improvement in the economy. Things are still pretty crummy, but by all indicators it looks like we bottomed out around January ’10. At this point there really is no where to go but up.
