In a season with plenty of chilling numbers, try this one: American households have lost something in the order of $7 trillion of wealth this year alone.

That ballpark estimate of the damage done to households implies that personal spending will be cut back even more sharply than is already showing up in data.

The debit side of personal balance sheets doesn't look so good either; credit is tougher to get and more expensive and banks are increasingly asking for their money back where they can.

If you are in the real estate or automotive industries - two sectors at the intersection of confidence and debt - you are very much out of luck.

But a real retrenching, one that takes savings rates back toward historical norms during a period of asset price deflation and higher unemployment, will leave very few parts of the consumer economy untouched.

Just as the banking and real estate crisis has been self-reinforcing, so too will be the consumer downturn as belt tightening prompts layoffs and layoffs prompt belt tightening.

Regardless of who wins the U.S. presidential election, additional deficit spending, tax rebates and other forms of fiscal stimulus are all a good bet - both to happen and to be not enough to break the cycle.

So, let's look at the numbers.

Using Federal Reserve data from the end of 2007 on household and nonprofit organization holdings of real estate and equity-related assets, Thomas Lawler, of Lawler Economic & Housing Consulting in Vienna, Virginia, applied a 15 percent year-to-date haircut to housing wealth and a 38 percent hit to direct stock, mutual fund and retirement account equity holdings, to arrive at that lost $7 trillion.

It isn't a pure number - it uses mark-to-market write-downs from the very broad Dow Jones Wilshire 5,000 index, which has recently recovered somewhat - but it gives a sense of the scale of the hit to confidence.

People are stretched, and what that will mean is beginning to dawn on them.

U.S. household debt hit 100 percent of gross domestic product in the early part of this decade and has risen to above 130 percent since then. The personal savings rate, which was above 10 percent during the very difficult economic times of the early 1980s, fell and fell and was bumping along just above zero until the first quarter, before jumping to close to 3 percent in the second, despite the promise and partial arrival of checks from what will come to be known as the first U.S. stimulus plan of this recession.

So, what is the evidence on how the stock and real estate crash has influenced consumers?

They are saying they are gloomy and they are spending like they'd rather not leave the house.

The Reuters/University of Michigan survey of consumer confidence showed its steepest monthly drop on record in October, registering one of its gloomiest readings since 1980.

Retail sales dropped 1.2 percent in September and are down 1 percent from a year ago.

But when inflation is taken into account, retail sales fell at a 12.5 percent annualized clip, the biggest such drop since 1980, according to Asha Bangalore, an economist at Northern Trust in Chicago.

David Rosenberg, an economist at Merrill Lynch, points out that retail sales have now fallen three months running, a losing streak seen only four other times in the past five decades. Such a run has always been associated with a recession.

To be fair, the impact of wealth declines on consumer spending is not clear. Manoj Pradhan of Morgan Stanley in London reviewed studies on the impact of stock prices on consumption and found considerable variations, especially by region. He estimates, however, that a 32 percent drop in the S&P 500 index - roughly equivalent to the fall so far this year - could reduce consumption by 1.9 percent over as long as three years, implying a decline in GDP of 1.4 percent.

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