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NATIONAL REPORT -- Consumer confidence nose-dived in October, falling ever deeper into recession territory. Consumers are more pessimistic than they were in September -- going from a depressed mood to even more depressed, according to Chris G. Christopher, Jr., Senior Principal Economist, IHS Global Insight.
Consumer confidence fell to its lowest level since March 2009, due to the tremendous volatility in equity markets, and the European debt issue. In addition, Americans are not feeling very comfortable with their financial and economic prospects. Since the beginning of the summer, consumer confidence has fallen more than 35 percent.
"The jobs numbers are just above water, household net worth is getting wacked hard, the stability of the American banking system is in murky territory, poverty rates are up, and income inequality is on the rise. Some Americans have taken to the street to show their outrage," said Christopher.
Retail sales and consumer spending are moving at a very slow pace, despite the poor state of affairs on the consumer confidence front. Since consumer mood will not be very cheerful during the holiday shopping season, retailers will discount early, deep, and hard in order to grab market share and get traffic through their doors, he predicted.
Last month's Conference Board Index revealed:
• The Conference Board's Consumer Confidence Index nose-dived 6.6 points to reach 39.8 in October, the lowest level since March 2009.
• The expectations index fell 6.4 points to reach 48.7, the lowest level since March 2009. The present situation index fell 7 points to reach 26.3, the lowest level since November 2010.
• The percentage of respondents who think jobs are hard to get or not so plentiful increased to 96.6 percent in October from 94.4 percent in September.
• The percentage of respondents who think business conditions, employment or personal income will improve six months hence fell, fell, and fell.