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Very important, because if consumers don't feel as if the banks and lending institutions and their jobs aren't safe, they will save all their money for a rainy day instead of throwing it back into the economy by spending.

When it comes to those big ticket purchases like business opportunities and expansions, shares, and property acquisitions, consumers will be reluctant to make any big decisions if a. the banks are not fiscally stable b. the stock marketis volatile and c. the property values are fluctuating.

If the government does not inject confidence into the public after a big event, there will be a flow on effect, whereby consumers panic and the worst case scenario becomes reality.

The impact of the media and consumer confidence was probably not fully realised back in the 1920's -1930's depression, as the effects were unprecedented. in the current economic climate we are fully aware of the importance of remaining positive, however the information age means that news travels so fast that the government has less control over broadcast media, and panic can settle in very quickly.

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12y ago

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