Tuesday, September 25, 2012

More Good Breaking News... Consumer Confidence Jumps

Housing starts, sales and prices are up. That's good.

Also showing substantial improvement is the latest reading on consumer confidence. That's good, too.

Consumer-confidence gauge at 7-month high has the details:

"Led by expectations, a gauge of consumer confidence jumped in September to its highest level in seven months yet remained relatively low, the Conference Board reported Tuesday.

The consumer-confidence index increased to 70.3 in September — the highest level since February — from a revised 61.3 in August. A prior estimate for August pegged the level at 60.6. Generally when the economy is growing at a good clip, confidence readings reach at least 90.
“Despite continuing economic uncertainty, consumers are slightly more optimistic than they have been in several months,” said Lynn Franco, director of economic indicators at the Conference Board, a New York–based research group.

September expectations increased for employment and business conditions, while consumers’ views on the present situation also rose.

“These results could signify a crucial turning point as the housing headwinds turn into tailwinds propelling the consumer to make more of a dent in the pent-up demand as the holiday shopping season approaches,” said Michael Dolega, an economist at TD Economics. . . .

Looking at recent data trends, analysts at RDQ Economics in New York said households feel that the economy is “edging in the right direction,” and a sustained confidence gain “will be a wind in the sails of the president’s reelection chances.”

Summing Up

Similar to this morning's earlier report on the improved outlook for housing, the latest news on consumer confidence, while not healthy, is headed in the right direction. So maybe we've safely reached first base here, too. At least we're on base and with a chance to score.

Now let's hope nothing surprising happens to derail the budding U.S. economic recovery which is underway.

We can all use some ongoing good news about the U.S. economy's recovery. In my view, and perhaps yours as well, we've already had enough bad economic news to last us for at least another decade or more.

So while the news isn't great, it's not all bad either. In other words, slow growth is better than no growth and infinitely better than an uninterrupted long period of recession.

Maybe we should label this as a time to be long term optimistic while patiently impatient about the shorter term.

Thanks. Bob.

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