Chapman: California consumer confidence plunges

[graphrix_IHB]

<a href="http://www1.chapman.edu/argyros/acer/CSResults_2007Q4_12-10-07.pdf">Consumer Confidence Tumbles</a>





ORANGE, CA — The Anderson Center’s California Composite Index of Consumer Sentiment has tumbled to 71.0 in the fourth quarter of 2007. This represents a 25 percent drop from the third quarter and is the largest quarterly drop in the index since the third quarter of 2002 when this survey began. An index level below 100 reflects a higher percentage of pessimistic consumers as compared to those who are optimistic. Continued housing market woes, a volatile stock market, high gasoline prices, and concerns about the job market are negatively affecting consumers’ expectations about current economic conditions.





<img src="http://img107.mytextgraphics.com/photolava/2007/12/12/calconsent-48tcr6olg.jpg" alt="" />





The California Composite Index is generated based on three indices: consumers’ outlook on current and future economic conditions, and an index measuring consumers’ future spending plan. All of the three components of the composite index dropped in this quarter as compared to the third quarter levels.





The index measuring current economic conditions shows a deep plunge from a level of 90.3 in the third quarter of 2007 to 55.9 in the fourth quarter of 2007 – a sharp drop of 38 percent. Likewise, the index measuring future economic conditions declined, although not as much, from 102.0 in the previous quarter to 85.9 in the fourth quarter of 2007.





<img src="http://img108.mytextgraphics.com/photolava/2007/12/12/curvsfuture-48tcrvlr1.jpg" alt="" />





The index measuring consumers’ planned spending on big ticket items decreased by about 16 points in the fourth quarter of 2007 from the previous quarter and is sharply lower from the reading of 103.5 in the fourth quarter of 2006. This decline suggests further cutback in spending over the next six months – clearly bad news to retailers especially in this holiday season.





<img src="http://img107.mytextgraphics.com/photolava/2007/12/12/curspend-48tcsd6jb.jpg" alt="" />

 

[profette_IHB]

Nice bar chart action!

 

[profette_IHB]

<p><img alt="" src="http://cartoonbank.com/assets/1/45466_m.gif" /></p>

 

[biscuitninja_IHB]

<p>Well there ATM....er .. house is all out of equity and they really don't know what to do now that they have to pay it back.</p>

<p>I don't know why people ALWAYS sprint to something that is too good to be true?</p>

<p>-bix</p>

 

[profette_IHB]

<a href="http://www.ft.com/cms/s/0/989d0dc0-a98d-11dc-aa8b-0000779fd2ac.html">Retail data show US consumer spending resilient</a>

<p><em>Financial Times:</em></p>

<p>US retail sales rose twice as fast as expected last month, while wholesale inflation jumped by the most in more than thirty years, suggesting that impact of the housing slump and credit crisis on consumers has so far been limited, but that the threat of rising prices is growing.</p>

<p>Retail sales rose by 1.2 per cent in November, against economists’ forecasts of a 0.6 per cent rise. Core retail sales, which exclude volatile sales of motor vehicles and parts, rose by 1.8 per cent, after a 0.4 per cent rise in October.</p>

<p>Consumer spending has remained resilient even as the housing recession, credit troubles and soaring energy prices have hit confidence over the economy.</p>

<p>“This number confirms the solid start to the shopping season we had with Black Friday and Cyber Monday [two big days for retailers during the Thanksgiving holiday period],” said Sam Bullard, an economist at Wachovia. “Despite all the headlines about subprime … you have to ask yourself is middle America really feeling this crisis?” </p>

<p>Electronics and apparel sales were stronger, offering a promising start for retailers of computer games and consoles, flat screen TVs as well as signs that shoppers are buying winter clothes after an unusually warm October.</p>

<p>However, sliding consumer confidence figures indicate that times may be tougher in the months ahead as the US economy heads for slower growth.</p>

<p>“I do suspect that after the holiday shopping season consumers will get their credit card bills and reevaluate,” said Mr Bullard. “As the economy slows next year they may pull back on spending and save a bit more.” <strong>DOH!</strong></p>

 

[effenheimer_IHB]

<p>PPI had the biggest month over month jump in <a target="_blank" href="http://interestrateroundup.blogspot.com/2007/12/retail-sales-strong-inflation-soars.html">34 years</a>. What to do?</p>

<p>I know! Cut interest rates! </p>