For economic watchdog The Conference Board, it’s been a record-setting time – it seems like every time it releases a new consumer confidence index, a new low has been discovered, and February results are no exception. January’s temperature seemed low enough at 37.4, but now CB reports it has dropped to an arctic 25.0. Associated numbers are also well below freezing: The Present Situation Index declined to 21.2 from 29.7 last month. The Expectations Index decreased to 27.5 from 42.5 in January. Furthermore, 51.1% say business conditions are bad, compared to 6.8% who see them as good; and 47.8% think that jobs are hard to get.
Conference Board’s Lynn Franco said, "The Consumer Confidence Index, which was relatively flat in January, reached yet another all-time low in February (Index began in 1967). The decline in the Present Situation Index, driven by worsening business conditions and a rapidly deteriorating job market, suggests that overall economic conditions have weakened even further this quarter. Looking ahead, increasing concerns about business conditions, employment and earnings have further sapped confidence and driven expectations to their lowest level ever. In addition, inflation expectations, which had been easing over the past several months, have moderately picked up. All in all, not only do consumers feel overall economic conditions have grown more dire, but just as disconcerting, they anticipate no improvement in conditions over the next six months."
RBR/TVBR observation: Franco may be pessimistic, but there’s a bottom here somewhere, and perhaps this is it. As the weather warms up, and spring sprucing-up projects are undertaken, gardens started and at the very least modest vacation plans are made, moods may begin to brighten. And perhaps skittish consumers will begin to realize that even a harsh number like 10% unemployment still translates to 90% employment, and they’ll open their wallets and indulge themselves. We don’t expect the year to develop into a barnburner, but at least maybe we can bring an end to the plummeting.