From Michael Derby for Dow Jones Newswires. Some numbers to make you say, "hmmmm..."
The Conference Board reported Tuesday that its index of consumer confidence lost ground during the current month, at a reading of 103.2 from April's revised 109.8, which had represented a four-year high. Despite losing ground, the private research group's main index was nevertheless above 100.0, which was the consensus forecast of economists surveyed by Dow Jones Newswires.
The thing that interests me most is that the figures for April had been "revised". So, last month's report that told us how Americans were feeling, was not correct. So why should we believe this months?
Told you I like to ask questions.
"Apprehension about the short term outlook for the economy, the labor market and consumers' earning potential has driven the expectation index down to levels not seen since the aftermath of the hurricanes last summer," said Lynn Franco, who leads the Conference Board's Consumer Research Center. But she added " consumers continue to rate current conditions favorably."
So if my neighbor and I here in Ohio think the economy stinks, therefore the ecomony obviously stinks in North Carolina too?
"The downturn in attitudes in May is par for the course," said RBS Greenwich chief economist Stephen Stanley. "Each time that energy prices have spiked, sentiment has soured," he said. Stanley added that it's reasonable to expect some slowing in consumer spending as a result.
So, if energy prices fall a bit, consumer's attitudes will "sweeten"? I've never put together a business proposal that had a section entitled "attitude". Let's keep sentiment out of economics. If you're looking at subjective studies of people's attitudes about business, jobs or the economy to determine your business strategy, I think you've gotten off track.
To me, so much of this relies too heavily on how people feel about the economy, or jobs, or, whatever. How I feel has little to do with facts. To rely too heavily on them is a prescription for confusion or paralysis.
I've found the less I look at what "experts" or surveys say, the better my outlook is in general. Unless of course last night's sausage pizza has "soured" my sentiment.
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