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Consumer Confidence Slides As Low Gas Prices No Longer Lift Sentiment

Tyler Durden's picture




 

Moments ago we got a double whammy of both the Conference Board and Gallup's consumer confidence data. We were not surprised to observe that the gaping divergence between these two data series which supposedly measure the exact same thing and yet which both report dramatically different results, have started to converge. To the downside.

First, it was the Conference Board, which at 97.6 slid from 103 the month before, badly missing expectations of a 102.9 print. Worse still, "hope" slid to its lowest in 3 months as "jobs plentiful" slid notably with fewer jobs and decreasing income.

Here is what the survey said:

“Consumer confidence declined in October, following September’s modest gain,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “Consumers were less positive in their assessment of present-day conditions, in particular the job market, and were moderately less optimistic about the short-term outlook. Despite the decline, consumers still rate current conditions favorably, but they do not anticipate the economy strengthening much in the near-term.”

 

Consumers’ appraisal of current conditions was somewhat less positive in October. Those saying business conditions are “good” decreased from 28.1 percent to 26.5 percent, while those claiming business conditions are “bad” increased from 16.4 percent to 18.3 percent. Consumers were also less upbeat about the job market. Those stating jobs are “plentiful” decreased from 24.8 percent to 22.2 percent, while those claiming jobs are “hard to get” edged up to 25.8 percent from 24.9 percent.

Optimism also faded:

Consumers’ outlook for the labor market was slightly less optimistic. Those anticipating more jobs in the months ahead declined moderately from 14.9 percent to 14.5 percent, while those anticipating fewer jobs increased from 15.9 percent to 16.9 percent. The proportion of consumers expecting their incomes to increase declined from 18.7 percent to 18.0 percent, while the proportion expecting a decline increased from 9.9 percent to 10.7 percent.

And with this mea culpa by the Conf Board, we go to Gallup whose estimations of consumer confidence have been far more accurate.

Gallup's Economic Confidence Index registered -13 for the week ending Oct. 25, identical to the week before. The index has held within a two-point range, between -12 and -14, for eight straight weeks.

U.S. Economic Confidence Index -- Weekly Averages Since October 2014

Last week's current conditions score of -6 is the result of 24% of Americans rating the economy as excellent or good and 30% saying it is poor. The economic outlook score of -19 is the result of 38% saying the economy is getting better and 57% saying it is getting worse. Both are essentially unchanged from the prior week.

U.S. Economic Confidence Index Components -- Weekly Averages Since October 2014

Gallup's bottom line: things are once again starting to go bad, as the "transitory" optimism from lower gas prices fades and consumers demand more stock market gains:

Though Americans' confidence in the economy remains negative, it has also not gotten worse after recovering from the year's low point of -17 in August.

 

October has brought some positive news as the Dow recovers, with gas prices and the national unemployment rate remaining relatively low. But amid these encouraging signs, major U.S. corporations are reporting a dip in sales and profits, and have signaled a slowing of production that could continue into 2016. None of these factors appears to have been enough to cause Americans to readjust their economic outlook in recent weeks.

 

For their part, Americans are not as optimistic as they were at the start of 2015, when the consistent decline in gas prices that began late last year helped make them more positive about the economy. Gas prices remain low relative to where they were in the summer of 2014, but Americans may be accustomed to the lower prices now and this may not have as much impact on their views of the U.S. economy's health as it did in late 2014 and early 2015. Other factors, like the struggles of the stock market for much of this year, may be more top-of-mind now. And while their confidence in the economy's current health is only slightly negative, their sense of the direction in which the economy is heading is even less rosy.

The question is whether this data will be bad enough to send stocks surging into the green ahead of AAPL's earnings report after the close.

 

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Tue, 10/27/2015 - 10:11 | 6716446 NoDebt
NoDebt's picture

I care what sheep think.  Just look how happy they were at the beginning of 2008.  How'd that turn out for them?

 

Tue, 10/27/2015 - 10:14 | 6716455 Money Counterfeiter
Money Counterfeiter's picture

But this time it will be even better.

Tue, 10/27/2015 - 11:32 | 6716799 El Dorado
El Dorado's picture

I wonder if consumer confidence rises to 110, maybe we even get to see a 120 provided QE4, all while ensuring the continued impoverishment of the middle class.

Tue, 10/27/2015 - 10:15 | 6716450 FreeShitter
FreeShitter's picture

The sheeple are tapped and broke and have no idea why, but hey at least they have fuckbook to check and see if they have any "likes".

Tue, 10/27/2015 - 10:14 | 6716453 Thisisbullishright
Thisisbullishright's picture

90% of Mericans don't think one FUCKING IOTA about how the stock market is doing!!  They think about the Kardashians and Kims bubble ass!!

 

Tue, 10/27/2015 - 10:16 | 6716459 Money Counterfeiter
Money Counterfeiter's picture

K-Y and Kim.  USSA.

Tue, 10/27/2015 - 10:30 | 6716498 two hoots
two hoots's picture

I couldn't pick out Karashian or a Kim in a one person line-up.  Is bubble ass the new name for fat ass?

Tue, 10/27/2015 - 10:35 | 6716523 Temporalist
Temporalist's picture

No a bubble ass is Greenspan, Bernanke or Yellen.

Tue, 10/27/2015 - 10:34 | 6716515 taopraxis
taopraxis's picture

Makes sense given something like 90% of the market is owned by about 15% of the population.

Tue, 10/27/2015 - 10:31 | 6716502 taopraxis
taopraxis's picture

I ignore all of the different confidence numbers...worthless, in my opinion. Just trimmed my shorts again, btw, back to my core short stock position and only about 3% worse for wear after getting squeezed by last week's move. Rack 'em up...

Tue, 10/27/2015 - 10:32 | 6716506 yogibear
yogibear's picture

Means their debt/credit is maxed out. It will be tougher to buy another $1,000 iPhone.

Tue, 10/27/2015 - 10:41 | 6716541 Bill of Rights
Bill of Rights's picture

As if .50 cents cheaper for a gallon of gas makes the WORLD of difference, see how these fuck'en lunatics think...

Tue, 10/27/2015 - 10:42 | 6716542 T-888
T-888's picture

When you have your student loan payments to make, what is a consumer?

My GF's student loan payment just went up from $100/mth to $200/mth since the servicing company found out she got a $3,ooo/year raise when she took her new 'job' making $33k/yr. I was fucking floored. I helped her with her budget so she could break the debt-slave chains and was able get her to save $150/mth while servicing the loan and all her other bills. Now her budget is wrekt and she has nothing to spend on anything.

Tue, 10/27/2015 - 10:49 | 6716577 Bill of Rights
Bill of Rights's picture

Not to sure of the specifics, but take her student loan and transfer it to a credit card, at least if she goes belly up the CC can be written off in bankruptcy.

Tue, 10/27/2015 - 13:55 | 6717410 RopeADope
RopeADope's picture

There is usually a look-back period, you would have to keep it current for a period of time before the CC company cannot claw-back the transfer to the student loan. Perhaps a 0% balance transfer that matches/exceeds the wait period would be best.

Tue, 10/27/2015 - 10:47 | 6716559 CHoward
CHoward's picture

These "people" piss me off big time.  My own personal "consumer confidence" does NOT hinge on the fucking price of gas!  Get that through your thick skulls you stupid fucks!!

Tue, 10/27/2015 - 10:57 | 6716621 the grateful un...
the grateful unemployed's picture

tale of two worlds, in SD unemployment is a new low but one of the biggest tech firms, Qualcom is laying off. frankly ive gotten to the point where services are too expensive and i either defer or outsource the job (to myself) i learned a while back that if you are going to survive your income coming in has to exceed your expensives. the last inflation report shows services without energy is off the chart. i even noticed Walmart selling a home dental hygenists set, mom and dad can clean each others teeth, save $200 bucks.

Tue, 10/27/2015 - 11:15 | 6716704 Bryan
Bryan's picture

Lower OIL prices.  Not lower GAS prices.  The goobermint just ramps up the taxes when oil slides so the unsuspecting public doesn't see the increase.  With oil under $45/bbl, gas should be in the $1.00-1.50 range.

Tue, 10/27/2015 - 11:40 | 6716840 adr
adr's picture

That's because gas is more expensive than last year by $.30 a gallon but oil is $20 less per barrel. Health insurance premiums are up another 20-40% and electric rates have doubled since last year.

 Even Bruce Jenner is probably tired of taking it up the ass by now.

Tue, 10/27/2015 - 14:33 | 6717610 dizzyfingers
dizzyfingers's picture

My sentiments were lifted this morning as I drove home from a meeting and saw gas for $2.18 per gallon at a corner. It's not the 18 cents per gal that my dad paid in 1946 but it's better than the $5+ we were paying just a couple of years ago. Now if good jobs would reappear...

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