Consumer confidence is a lagging indicator, but...

Consumer confidence lags at the turns, but this decline is reveals that the efforts of the government and central bank only managed to inflate expectations.

Just yesterday, I wrote about Obama's low poll ratings and how the stock market would converge with those numbers. Here's another poll, consumer confidence, showing a negative social mood. Today's "surprise" drop isn't a great surprise to many observers though. ZeroHedge has been covering the divergence with the ABC Consumer Confidence survey for months.

An explanation for the drop in consumer confidence is also found in the number of Americans saying they are underemployed.
Those who were underemployed reported spending 36% less than those who were employed, $48 per day versus $75 per day.
Also important to watch is the insider selling at Google and other corporations.If the rise in stocks is responsible for some non-trivial amount of confidence, a decline in stocks would do a number on President approval, consumer confidence, etc.

No comments:

Post a Comment