One sentence from a restaurant company's conference call reveals the hidden strength of the US economy
But retail sales have disappointed of late, and a recent chart from Jefferies made it seem as if consumers aren't planning a huge increase in spending coming up this year.
(Though Bank of America Merrill Lynch's Michelle Meyer noted in a recent research report that this disappointment may also be a result of retail sales being reported in nominal, not real, dollars, which means that inflation-adjusted sales aren't such a huge disappointment after all.)
One area of strength, however, has been restaurants and bars.
Sales at restaurants and drinking places topped grocery sales for the first time ever in January, and restaurant sales have been spiking over the past few months. So, there is certainly some consumer strength out there, even if the headline numbers are disappointing.
On Friday morning, Darden Restaurants, which owns and operates Olive Garden and LongHorn Steakhouse among other restaurants, reported earnings per share that topped expectations on same-store sales that rose 3.3% in the quarter.
And on its conference call, the company said something that reveals the hidden confidence consumers have right now.
Darden's observation, which came to us via Conor Sen of New River Investments, is that the company is seeing more add-on sales like alcohol and dessert.
This may seem like a throwaway line, but Darden is picking up on a real increase in confidence.
The economists' math on how much of a "tax break" consumers receive from a decline in gas prices uses the old economic maxim of assuming rational actors. But people aren't rational - they're just people.
As a result the savings rate has increased as gas prices have declined, and Wells Fargo found earlier this year that it seemed as if people were actually spending more money on gas despite the decline in prices.
With gas prices having been elevated for years since the financial crisis, there is a school of thought that says consumers won't really do anything with those gas savings until they are confident these prices are here to stay. And the future of gas prices, of course, remains uncertain.
But right now it seems consumers are on at least one small but meaningful level spending more money on things they wouldn't usually spend on.
Another good sign for the economy.