London, United Kingdom (PressExposure) September 02, 2009 -- "Zen International" the Asian-based investment broker believes that the upturn in US consumer spending as a result of the "cash for clunkers" program will be short-lived and may be at the expense of future sales.
Sources close to "Zen International" say that the program is the equivalent of keeping plumbers in business by bursting everybody's pipes.
Under the terms of the program, US drivers could trade in their gas-guzzlers for new, fuel-efficient vehicles in return for $4,500 payment. Although the US government says that the incentive is aimed at taking the most polluting vehicles of the road, many believe that its primary aim is to boost auto sales. "Zen International" analysts say that in light of the fact that new vehicles only have to offer a 4 mpg improvement over the old, this assertion is probably correct.
Consumption in the world's largest economy remained weak as evidenced by reduced sales in other sectors like department stores.
Whilst many economies appear to be holding out for a return to consumer spending in the 3rd quarter of 2009, "Zen International" believe s that any improvements will be fueled by incentives similar to cash for clunkers and that, ultimately, it wouldn't be the consumer spending money but the government effectively giving it away.