Associated Press

NEW YORK — Do you recall the kid in the fifth grade who always seemed to be looking out the window while the teacher was writing the assignment on the blackboard? That’s the American consumer today.

Businesses are re-examining their capital appropriations plans lest they overdo their spending, and local, state and federal governments are promising cuts. But it seems the consumer hasn’t read the assignment.

It’s been repeated enough. Federal Reserve Chairman Alan Greenspan has said it dozens of times over recent years: Slow down, watch your spending, try to save or else this economy is headed for trouble.

He’s succeeded to a degree, and now it appears the economy will achieve a soft — rather than a crash — landing. But little thanks to the consumer, who continues to spend with abandon, even borrowing to do so.

The Federal Reserve said last week that consumer credit rose by $13.4 billion in September, a figure that was translated into unexpectedly strong automotive and home sales, in extraordinary spending on travel and entertainment, and in the casual, everyday use of credit cards.

True, consumers’ incomes rose strongly in September, but apparently not sufficiently to convince them to use cash instead of credit, and still not enough to raise the savings rate above zero.

On the surface, at least, this seems to defy the concerns expressed in the most recent University of Michigan consumer survey, primarily that consumers are worried that incomes might fall and inflation might rise.

It also seems to ignore the precipitous decline in dotcom stocks, on which a good deal of consumer hopes depended. If the sudden loss of $500 billion or so in the value of dotcoms and their cousins doesn’t make an impression, what can?

In fairness, while consumers might not have learned their assignments very well, they aren’t totally at fault. Federal regulators are worried that banks have just as indiscreetly lowered their standards.

Consumer solicitations by credit card issuers during April, May and June reached 992 million, the highest quarterly number ever measured by BAIGglobal, a market research firm specializing in such studies.

Consumers, in fact, even showed unusual resistance to solicitations, but issuers still netted 4 million applications, and it can be assumed that a large number of nonrespondents already have at least one card.

Their resistance, however, hardly indicate that the courage of consumers has diminished.

The Michigan surveyors comment that in spite of stock market and other worries this year, consumers have merely tempered their optimism, rather than abandoned it.

The majority of consumers in the October survey, said Richard Curtin, director, "still expected the expansion to last at least another five years."

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