by Calculated Risk on 4/27/2010 11:55:00 PM

From Ylan Q. Mui and Neil Irwin at the WaPo: Consumer confidence is up, but test looms

"Some would say there is a recovery taking place," [Wal-Mart chief executive Mike Duke] said during a meeting with Washington Post editors and reporters. "The lower-income and middle-income customers . . . they still feel the pressure."

In addition, he said that the weak housing market continued to hold back the recovery in states such as Florida and Nevada. During the boom years, many jobs in those states were fueled by a surge of construction that has since abated, drying up the demand for labor.

"It will take housing to create some of those jobs," Duke said.

Don't hold your breath on housing and housing related jobs.

And a summary paragraph in the article:

With federal stimulus spending beginning to taper off over the second half of the year, the fragile recovery in the housing markets showing signs of petering out and exports unlikely to create the same boost over the next nine months that they did over the past nine months, it will be up to American consumers to pick up the slack and drive a continued expansion.

The stimulus spending peaks in Q2, and then starts to decline in Q3. And the housing market will continue to struggle with the huge overhang of existing inventory and distressed properties. Still I don't expect a 'double dip', but a slowdown in the 2nd half of the year seems likely.