Tuesday, May 27, 2008

Consumer Confidence Heading South


This morning The Conference Board reported (http://www.conference-board.org/economics/ConsumerConfidence.cfm) that consumer confidence had plunged to 57.2

If you update the chart with that number, you can see that consumer confidence has fallen to its lowest level since the aftermath of the 1990-91 recession. If it falls more than another ten points, we’ll be below any of the troughs recorded in the chart.

Consumer Confidence

(Click on chart to enlarge)

Recessions shaded

In the bulletin that accompanied The Conference Board’s announcement, Lynn Franco, Director of the Board’s Consumer Research Center said: "….Weakening business and job conditions coupled with growing pessimism about the short-term future have further depleted consumers' confidence in the overall state of the economy.”

On its web site the Associated Press (http://hosted.ap.org/dynamic/stories/C/CONSUMER_CONFIDENCE?SITE=ORAST&SECTION=HOME&TEMPLATE=DEFAULT) quoted Mark Vitner, senior economist with Wachovia Corp., as saying that as "awful as these numbers" look, he doesn't believe that confidence has bottomed out yet, an ominous sign for consumer spending.”

It certainly seems that the bad news is overwhelming the good news.

(The chart was taken from http://www.beyourowneconomist.com. [Click on Seminars and then Charts.] Go there for additional charts on the economy and a list of Economic Indicators.)

© 2008 Michael B. Lehmann

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