Consumer confidence “unexpectedly” declined in May. Really? Unexpectedly? It would seem that the media by now would be more creative with their wording besides “surprise” and “unexpected”.
The press release should have read today that “U.S. consumer repudiated any confidence in May as consumers soured on the outlook for the labor market as 1 in 5 were on food stamps, were out of work or were underwater on their mortgage. Oh, and concerns over rising food and gasoline rose sharply.”
“Astonishingly, the index of consumer attitudes fell to 60.8 from a revised 66.0 in April which as crushingly below economists’ forecasts for 66.5. While staggering in its own right, the current situation index was confirmed by the unforeseen descent, by the economists, in the expectations index which collapsed from to 75.2 from 83.2, while the present situation tripped to 39.3 from 40.2.”
“As we stated, it is ‘having a job’ that drives consumer’s confidence overall and this was confirmed by the labor market assessment which continues to be dire as the proportion of those who said jobs were hard to get rose to 43.9% from 42.4%. They were also depressed about their view of the labor market for the next six months as those expecting more jobs in the coming months decreased to 15.9% from 17.8%, and those expecting fewer jobs rose to 20.8% from 18.7%.”
All jesting aside – economists and analysts continue to expect the economy to recover as if by some form of miracle. As we have seen recently by a variety of economic indicators the statistical recovery is slowing rapidly and without another round of injections from the Fed and programs to support manufacturing and production we may well see sub-1% economic growth numbers in the very near future.