Why your happiness matters for the economy!

Why your happiness matters for the economy!

Melody Warnick feels good. After the stock market crashed last year, the Iowa writer began pouring money into the stock market, bulking up her retirement accounts and buying shares in Apple and Yahoo.

“My husband and I have been pretty dang optimistic throughout the recession,” said Warnick, 33, a mother of two children who has since seen her investments jump more than 30 percent. “I’m a bargain-hunter, so when stock prices dropped, I thought, ‘It’s a sale.'”

The economy would be much better off if more Americans were equally positive, economists say. They are closely watching for signs of optimism among the nation’s consumers and hoping that some of it will rub off on others, and translate into more spending.

“People are very much affected by the mood of the moment,” said Robert H. Frank, a professor of behavioral economics at Cornell University in Ithaca, N.Y. “When some people start buying, others think they must know what they’re doing so they go along with it.”

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