consumer confidence: Consumer Confidence: The Tail Is Wagging The Dog - 07/10/09 05:04 AM
On May 26th, as a result of consumer confidence surging despite a deteriorating job market and eroding home values, I arrived at the conclusion that the stock market rally was the reason for the increase in consumer sentiment, there was no other explanation. 
The flaw in this "confidence" was of course that the stock market rally had no economic basis, it was built on sand.  The source of the rally was hope rather than an actual healing of the economy.  The tail was wagging the dog.
Well, here we are on July 10th and the market looks to be returning to low tide.  Not surprisingly the … (5 comments)

consumer confidence: Consumer Confidence Highest Since February 2008? - 06/26/09 04:01 PM
The Reuters/University of Michigan Surveys of Consumers said that consumer confidence rose to 70.8 in June, the highest reading since February of 2008.
This of course begs the question, why?
As I wrote about last month, it appears that the tail is wagging the dog with these numbers.
There are three major "economic" concerns that people have, their home, their job, and their investments (stocks).
Home values are still falling like a rock as is evidence by the latest numbers published by the NAR showing a -16.8% decline.  There are very good indications that home values will continue to fall for … (5 comments)

consumer confidence: Wait a second, I thought the economy was recovering? - 06/22/09 04:10 AM
Wait a second, I thought the economy was recovering?
Isn't that what everybody has been saying?
What about all of those "green shoots" and mustard seeds that Bernanke and Larry Kudlow have been talking about?
Didn't the new administration tells us that unemployment would only peak at 8% because of their "stimulus" plan? 
What about the recent Wall St. rally?
I thought consumer confidence was up?
Even Jim Cramer recently called a housing bottom.
But then I read today that the World Bank's revised economic forecast shows that the recession will be deeper than once thought. 
The truth is that an economic recovery is difficult when … (6 comments)

consumer confidence: Consumer Confidence: Is The Tail Wagging The Dog? - 05/26/09 03:24 AM
Consumer confidence jumped from 40.8 in April to 54.9 in May, the largest one-month jump since April of 2003, according to Reuters.
In light of May's surge in consumer confidence as well as a deteriorating job market and housing market, it begs the question, is the tail wagging?
What I mean by this is that there are three things that people are going to be economically concerned with; their jobs, their homes, and their retirement or investment accounts.  These factors are going to drive consumer confidence.
We know that the job market, despite the government's best efforts to blunt the reports, is continuing to … (2 comments)

consumer confidence: The Bad News About Increased Consumer Confidence - 05/01/09 04:42 AM
According to an article by Reuters, "The Reuters/University of Michigan Surveys of Consumers said its final index of confidence climbed to 65.1 in April from 57.3 in March. That was the highest since September 2008 and the biggest one-month increase since October 2006."  This is certainly good news as an economic recovery without the confidence of the consumer is not viable.
Part of this increased consumer confidence may be attributed to the fact that the stock market, which is no longer an economic indicator, has had a great month.
However, what is concerning is that housing activity, specifically mortgage purchase applications, have remained … (1 comments)

consumer confidence: Consumer confidence at record low, literally - 02/24/09 05:56 AM
According to Reuters, the Conference Board announced that consumer confidence cratered from 37.4 in January to 25 this month; this is the lowest reading on record since they began tracking the data in 1967.  The expectation was for a reading of 35.5.
The amazing part about this report was that only 8.7% of consumers think that business conditions will improve within the next six months, that is saying something.  The near future looks very bleak according to most Americans, I would tend to agree with them.
The reason is pretty simple, the speed of the deterioration in the broader economy and asset classes, namely stocks and real estate, has … (3 comments)

Mark MacKenzie

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