Low Rates May Do Little to Entice Nervous Consumers

The Federal Reserve’s announcement last week that it intended to keep credit cheap for at least two more years was a clear invitation to Americans: Go out and borrow.

But many economists say it will take more than low interest rates to persuade consumers, a crucial driver of the nation’s economy, to take on more debt.

There are already signs that the recent stock market upheaval, turbulence in Europe and gridlock in Washington over the federal deficit have spooked consumers. On Friday, preliminary data showed that the Thomson Reuters/University of Michigan consumer sentiment index had fallen this month to lower than it was in November 2008, when the country was deep in recession.

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