Posted on 02/25/2010 9:42:04 PM PST by Lorianne
Today’s bleak consumer confidence number is undoubtedly bad news for the economy. The bigger than expected drop suggests that consumers have lost confidence in the recovery, which will drive down home prices and consumer spending.
Consumer confidence is typically our “first look” at the state of the economy. While most government aggregated data come out with a two-month lag, or more, consumer confidence hits with just a one month lag. Studies have shown that consumer confidence is a good predictor of consumer spending numbers. Basically, people surveyed seem to be good at accurately reading their own economic situation, and those surveyed accurately reflect the broader economy. When consumer confidence drops to such deep unexpected levels–today’s were the worst in 27 years–then it is a flashing red-light about the economy.
The expectation that we would have a textbook end to the recession informed many of the expectations that were blown away by today’s drop in consumer confidence. We’ve have a historical record of 31 previous recessions in the United States, most of which indicate that the end of the inventory cycle boosts production and therefore employment and incomes. More importantly, the workers who kept their jobs become more confident about their future job and income prospects and begin to spend a larger fraction of their incomes. Deferred spending during a recession usually creates pent-up demand by consumers and businesses that then boosts spending once the recession ends.
(Excerpt) Read more at blogs.reuters.com ...
Probably going to be a “jobless” double dip too!
Until the White House no longer has a loose cannon in it, the malaise will continue.
Big-time doo doo for the RAT Elites in DC.
The Obungler may finally be figuring out how hard leadership is. If you can't throw other people's money at it or blame Bush for it, the nitwit narcissistic arrogant moronic bozo's at a loss about what to do.
Ain’t “lookin’ good” for November. LOL!
Is “bigger than expected” synonymous with “unexpected”?
The layoffs, tax increases and wealth redistribution will continue until morale improves!
Economy WILL NOT improve until unemployment (the real unemployment number that include those who are underemployed and/or given up) improves drastically. Until then, I dont care what anyone says, the economy is going to struggle.
People cant spend money they dont have. So that slows down the movement of money which grinds the economy to a halt.
This is economics 101, folks.
Zimbabwe here we come.
...before the rioting and R2/CW2 begin.
Somewhere....like, say, the White House....a treasonous usurper is smiling.
Its a recovery-less recovery...
A liberal where I work is not a happy man. He told a co-worker that he got “fooled” into voting for 0bama. He didn’t get fooled because he was already an idiot.
The faster a dollar moves through the economy, changing hands, the better the economy.
If the government confiscates cash (taxes income) the velocity grinds to a halt.
It is Economics 101.
The government does not "create jobs." All it ever does is put up obstacles, provides dis-incentives to employers to hire employees.
Cloward-Piven.
There ya go! Probably going to be worse than expected too!
I don’t even believe this is a “recession” anymore, it’s just the new normal. We are seeing the end result of 20 or so years of pathetic economic decisions by our “leaders” and policy makers. We need to look back at what we have done during that time.... The irresponsible fiscal policies and ruinous trade agreements, and do the opposite from now on, and undo what CAN be undone.
I don’t even believe this is a “recession” anymore, it’s just the new normal. We are seeing the end result of 20 or so years of pathetic economic decisions by our “leaders” and policy makers. We need to look back at what we have done during that time.... The irresponsible fiscal policies and ruinous trade agreements, and do the opposite from now on, and undo what CAN be undone.
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Well said. Thank you.
There ain’t no such thing as a jobless recovery.
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