There’s some bad news to report on the U.S. economy this morning, and of course, it was unexpected:
Although by now we’ve come to expect the unexpected bad news, which economists seem to always miss. Today’s “plunge” as measured by The Conference Board’s Consumer Confidence Index, however, was incredibly off the mark. How in the world did they not see this trainwreck coming?
As for what caused the decline, economists at The Conference Board blame Greece and China:
Says Lynn Franco, Director of Economic Indicators at The Conference Board: “Consumer confidence declined sharply in July, following a gain in June. Consumers continue to assess current conditions favorably, but their short-term expectations deteriorated this month. A less optimistic outlook for the labor market, and perhaps the uncertainty and volatility in financial markets prompted by the situation in Greece and China, appears to have shaken consumers’ confidence. Overall, the Index remains at levels associated with an expanding economy and a relatively confident consumer.”
Consumers’ assessment of current conditions was somewhat less favorable in July. Those saying business conditions are “good” decreased from 26.1 percent to 24.2 percent. However, those claiming business conditions are “bad” was virtually unchanged at 17.9 percent. Consumers were slightly less positive about the job market. Those stating jobs are “plentiful” decreased from 21.3 percent to 20.7 percent, while those claiming jobs are “hard to get” increased marginally from 26.1 percent to 26.7 percent.
Or maybe people have finally stopped listening to President Obama’s happy-talk: