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Consumer Confidence

by Carl Pellegrini

Wed, Dec 2, 2009, 12:58 PM

The Rasmussen Consumer Index, which measures the economic confidence of consumers on a daily basis, fell three points on Wednesday to a four month low. At 69.0, the Consumer Index is down five points from a week ago and down seven points from a month ago. Confidence is now at the lowest level since July 24 and is up only nine points from the beginning of the year.

Just 8% of adults rate the economy as good or excellent while 58% say it is in poor shape. Just 24% say the economy is getting better while 51% say it is getting worse. Seventy-five percent (75%) say the U.S. is still in a recession.

While perceptions of the overall economy have improved somewhat since the beginning of the year, perceptions of personal finances have not. When the year began, 33% rated their personal finances as good or excellent while just 25% said poor. Today, just 26% say their finances are in good or excellent shape while 29% say poor.

Sixteen percent (16%) now say their personal finances are getting better while 53% say they are getting worse. Those numbers are virtually identical to the pessimistic assessment from the beginning of the year when 17% said better and 53% said the opposite.

Rasmussen Consumer Index: Daily Readings

2-Dec
WE
69.0

1-Dec
TU
71.6

Rasmussen Consumer Index:
Full month recent history

Nov-09
73.9

Oct-09
77.3

Sep-09
79.1

Aug-09
77.0

Jul-09
69.2

Jun-09
72.0

May-09
73.2

Apr-09
70.8

Mar-09
64.2

Feb-09
57.6

Jan-09
60.8

Dec-08
59.6

Nov-08
64.5

Oct-08
69.0

Sep-08
78.3

Aug-08
79.7

Jul-08
72.8

Jun-08
71.9

May-08
73.5

Apr-08
74.8

Mar-08
76.9

Feb-08
86.1

Jan-08
89.5

Consumer Index Highs and Lows

High
Low

2009
83.5
54.7

2008
99.5
56.7

2007
121.9
91.5

2006
124.0
99.3

2005
121.2
95.4

2004
127.0
104.6

2003
123.2
83.2

2002
124.3
95.5

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Comments (4) add comment

...
written by John Weekley , December 02, 2009

It's not surprising that the lack of consumer confidence is growing.

We're still losing, on average, around half-a-million jobs per week, and the job creation numbers are dismal.

The stimulus didn't work, and we're now in the fourth wave of the recession, where many people can't borrow any more, they're maxed-out on their credit cards, they're about to lose their homes, they're facing bankruptcy, and they have no place to go.

Consumer Confidence is something of an index of barometric economic experience combined with expectations. The more people who are miserable, the more the word on the street is 'increased misery down the road'.

Many retailers have held on, hoping to recoup their losses at Christmas. But, with almost one-in-five Americans out of work, and with those who are working hoarding/saving money as a hedge against losing their jobs, Christmas is likely to not be so merry for retailers.

The more the President and Congress talk about new draconian taxes, the more businesses large and small wait to hire, uncertain as to how much they might have to expand or add staff.

"Uncertainty" is the enemy of many things in Economics; Consumer Confidence is just one of them.

...
written by austin , December 03, 2009

Since Obama took office consumer confidence is up by nine points, the Dow is up by 2000 points, and this is bad, somehow?

...
written by Steve Heath , December 03, 2009

Austin -it's taken a couple of trillion dollars in borrowed money (borrowed from the Chinese and our Childrens' future) to get the DOW up. I believe the stimulus projected to have unemployment down to under 7% by now. It has not worked. Obama has taken care of the bankers and Wall Street. hey have responded by awarding themselves obscene bonuses -even shareholders of Goldman Sachs are complaining that the $17 billion Goldman Execs are paying themselves as bonuses should be more fairly apportioned to pay shareholders. Of course most Americans have IRAs and stock funds that have Goldman and banking stocks -so that would mean that Goldman would have to share some of the wealth with the rest of us. A group of liberal democrats are putting pressure on Obama to fire Geithner. They are concerned that the public backlash will hurt the Democrats and allow the republicans back in power. If I were a Democrat, I would rightfully be very concerned.

...
written by John Weekley , December 03, 2009

That the market is up is great news. It's too late to save millions of people who lost as much as 2/3 of their savings, and had to deplete what was left of their capital investment. But, the lift in the market is a good sign.

What's not good is the high level of unemployment and the utter lack of positive "new jobs" indicators. The only sector of the economy that has been adding large numbers of jobs is government, and that costs us in terms of higher taxes and fewer dollars available for hiring in the private sector.

I know extremely competent people who have been out of work for 18 months; some longer. They've lost most of what they have. Their prospects aren't much better for next year, and they are about out of options.

Drive around Dallas and look at the business that have closed. Each of those represents several families without income, a loss of tax income to government, a loss of rental income to landlords, a loss of utility services income, a loss of other business services and products, and a loss of a source of goods and services for the community.

What's more, like every home foreclosure, every business that is shuttered telegraphs a loss of confidence to business owners and consumers.

There has not been, and there is not currently, an effort by the federal government to create new jobs in the sectors most likely to actually create jobs across the scales of income.

For reasons that most suspect are political, the Obama Administration has yet to follow the Kennedy and Reagan strategies of lowering business taxes to stimulate jobs.

In fact, Obama initiatives such as the takeover of health care, Cap and Trade, Card Check, the return of draconian death taxes, and a variety of nickel and dime taxes have scared businesses away from hiring.

The good news is that ClimateGate has exposed anthropogenic Global Warming as a fraud, so it's almost a sure thing that Cap and Trade are dead on arrival. The further good news is that we'll have far fewer government mandates to achieve arbitrary "green" levels. (I support some of those, mostly in the name of energy independence.) But, I'm also hoping Congress will allow oil and gas drilling again, thereby making us even less dependent on foreign oil.

I DO believe we should encourage energy conservation and efficiency. That only makes good common sense. But, at least we won't be in an incredibly expensive race for time to achieve carbon levels made up out of whole cloth and coerced by government.

Hopefully, the Christmas Season shopping will be better than some expected, and the normal job hiring cycles which go up in January will be better than expected.

But, most of the news is still pretty grim, and certainly makes a loss of consumer confidence appear to be realistic appraisal.

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