Consumer Confidence

The decline in weekly consumer confidence as measured by ABC will not end. From -41 two weeks ago, this number has now fallen a dramatic 8 points to -49. And add another double-dip data point: after being respondents were evenly split between those who think the economy is getting better and those who saw deterioration on December 13, 2009, the spread has surged with 36% now seeing a worsening while those who think things are getting better is now 24% the worst reading since June 2009. People have just about had enough of change they can believe in.

University of Michigan January Consumer Confidence came in at 72.8, below expectations of 74, which would have been an increase from unrevised December of 73.4. Instead December was revised down to 72.5 to make January seem like an improvement. The Sentiment number was driven higher by better than expected Current Conditions, which came in at 81 (prelim), up from 78 in December, while Expectations dropped to 67.5 from a revised 68.9 in December (69.7 unrevised).Inflation expectations for 1 Year increased from a final December read of 2.5 to 2.8 (which incidentally is the expectation for the 5 Year inflation expectations as well).

The ABC Consumer Confidence index plummeted last week, falling from -41 to -47, sustaining "one of its steepest one-week drops in the last quarter century, following last week’s troubling jobs report with an all-hands retreat from what had been a tentative positive trend in consumer attitudes." At -47 the index is essentially at the average 2009 level of -48, and far below the average since 1985 of -12. As far as the US consumer is concerned, this recession is far from over.

The ABC Consumer Confidence index was just released, and is notable as it is the first confidence read since the NFP/unemployment number was released last week by the BLS. And despite all expectations, and proddings by the Comcastic ones that the presumed drop in unemployment would boost sentiment and confidence, the index in fact dropped by two points from -45 to -47. Could people just be smarter, and finally better at seeing through the BS, than the mainstream media gives them credit for?

Market volatile (on low volume of course, the norm) after consumers no longer confident that stock market bubble will be sufficient to offset the lack of jobs. U Michgian reported consumer confidence dropped to 66 from 70.6 prior and 5 points lower than expectations of 71.

The real source of America's angst is a sense that something is terribly wrong.

The Conference Board's Consumer Confidence number for the month of October hit 47.7, a major decline from the September number of 53.4 and over a 5 point differential from the expected reading of 53.1. The data series has trended flat since hitting a high of 54.80 in May and has recently accelerated its pick up. As a reminder a reading above 90 means the economy is on solid footing. Above 100 signals strong growth. We are nowhere close and in fact getting worse by the month with unemployment, commodity inflation and wage deflation taking their toll on US consumers.

The Reuters/University of Michigan index fell to 69.4 in early October, below the 73.5 final September reading, and below economists' expectations of unchanged (73.5). The biggest factor for the drop was the decline in consumer expectations which was down a substantial 5.9 points to 67.6, well below expectations, while current conditions came in at 72.1, in line with consensus.

Big surprise in the Conf Board consumer confidence index, which posted a September reading of 53, down from 54.5 in August, and an expected reading by "economists" of 57. The market, which trades solely on macro headlines these days, takes a brief dive. Expect this not to last as window dressing time promptly regains a foothold, and bad news continues to be good news.

More troubling to TPTB should be the immediate reversal following yet another "stunner" out of UMich, Consumer Confidence or "The Market Is Up Because The Market Is Up Because The Market Is Up, etc." index.

Consumers now taking their unemployment benefits (which are increasingly running out) and investing all the proceeds into FNM and C. Market rips, confidence goes even higher. Facts and $9 trillion upcoming budget deficit ignored.

ABC Weekly Consumer Confidence has flatlined, and not only is it down to -49 from last month's reading of -47, it is at exactly the same place it was two months ago.

Reading at 25 versus survey consensus at 35 (whatever it is these numbers indicate), and a drop from 37.4 in January. Not like one needs the reasons for this but unemployment, record drops in house prices, stock market collapse and general rioting may hint as to the reasons.