Posted by Larry Doyle on August 16th, 2013 9:38 AM |
What do readers think about launching a new means to measure consumer sentiment?
We can continue to measure Consumer Confidence, but I propose we also launch a monthly reading hereby defined as The Pissed Off Indicator.
Why do I sense that so many in our country are pissed off? For the very simple reason that they are sick and tired of being pissed on.
This sense of disgust is not healthy or conducive to growing our economy, but it strikes me as self-evident. I write on this topic today given a steady stream of commentary I have received from regular readers over the last few days. (more…)
Posted by Larry Doyle on November 10th, 2010 7:47 AM |
Economic data is typically released and then reviewed in aggregate fashion. As such, understanding the dynamics at work within our economy is often clouded by the inability to access and analyse ‘the trees’ as opposed to ‘the forest.’ What happens as a result of this reality? Economic programs to address issues are typically crafted while looking through the rear view mirror. Regrettably results generated are often sub-standard and fraught with unintended consequences.
How might we change our perspective? Let’s check in with Rick Davis of Consumer Metrics Institute who projects what will occur in our economy based on a forward looking process that captures real-time consumer activity. As a longstanding admirer of Rick and his work, I welcome sharing his recent fabulous piece, Revisiting The Character of “The Great Recession”
We have commented before about how the “Great Recession” has changed character over time, evolving from a relatively normal “garden variety” and V-shaped consumer confidence recession into something far more persistent — where a lack of jobs and negative home equity has transformed it into a “new frugality.” But we haven’t previously discussed how the “Great Recession” has been an uneven experience among even those living in “Main Street” America. A recent review of our data has convinced us that this has not been a recession of shared pain, but one that has cut much deeper in some demographics than in others. (more…)
Posted by Larry Doyle on March 30th, 2010 12:36 PM |
The other night in my conversation with Richard Davis on No Quarter Radio’s Sense on Cents with Larry Doyle, I defined my outlook for the U.S. economy in 2010 as the equivalent of ‘walking pneumonia.’ What do I mean? Let’s look at today’s economic releases, Consumer Confidence and Home Prices.
Although pundits may want to promote the rebound in these statistics as a harbinger of economic health, I personally do not think we will see these measures running away from us anytime soon. Have you ever had ‘walking pneumonia?’ I have. You don’t move all that quickly. At times, you wonder what the hell is wrong with you. Welcome to the Uncle Sam economy 2010. (more…)
Posted by Larry Doyle on March 16th, 2010 9:38 AM |
If America and Americans are not at work, then how can we truly expect any other initiatives and undertakings to gain a foothold? There is nothing that generates more personal and collective confidence than a job. In fact, I would go even further and state that a job not only generates personal confidence for individuals, but ultimately a job very often defines a person’s self-worth.
Then why is it that the topic of jobs is not the OVERWHELMING focus in Washington eight days a week? While President Obama elevated the focus on job growth in his State of the Union speech, the topic seems to receive front page coverage only on the first Friday of the month when unemployment statistics are released. (more…)
Posted by Larry Doyle on October 28th, 2009 9:22 AM |
. . . would you be surprised? What would you do? What if the market declined by 20%? Would you be surprised? What would you do? How about if the market rose by 10% to 20%? Would you be surprised? I would.
The reason I ask these questions is an attempt to address the fundamental question as to what the market is telling us and what American consumers believe.
The equity market has traditionally been a reliable indicator of the future economy. The market provides a discounted valuation of future earnings. Those earnings drive companies and the economy at large.
As the market declines and prospects wane, businesses and consumers react accordingly. On the other side of the coin, as the market improves forecasting an improving economy, businesses and consumers react accordingly . . . until now. What is going on? (more…)
Posted by Larry Doyle on August 14th, 2009 3:33 PM |
I am an eternal optimist. I would also like to think I understand the fundamentals of the economy, and that I present a balanced approach here at Sense on Cents. So let’s pursue the truth.
The market is being hit 1-1.5% today on a retracement in the Consumer Confidence report this morning. While the equity markets have had an enormous rebound over the last few months, there is little doubt that the divide between Wall Street and Main Street has never been wider.
What impacts the consumer? In my opinion, the noise on Wall Street does not impact most Americans. What does? Job status, home value, and access to credit. How are Americans feeling on these fronts?
1. Jobs: the underemployment rate of 16.3% is forecasted to move higher and stay high. A little disconcerting, you think?
2. Home Value: foreclosures are continuing to surge, home prices are continuing to trend lower, and no reason for slowing on either front. Not generating lots of confidence here.
3. Credit: hat tip to MC from Investor Rebellion for sharing a story put out the other day by The Wall Street Journal which highlights how consumers’ credit cards are being discontinued indiscriminately without notice. This report, Cardholders Get Rude Surprise at the Register, is a true sign of the times.
Think about this scenario for a second. How humiliating and unsettling would it be to experience having your card rejected without notice. Do you think these people are going to rush out to do more shopping? Do you think their confidence may take a hit just a little?
Why is Wall Street, which is making all this “supposed” money and handing out enormous guarantees to certain employees, cutting credit lines? What do these banks see on the economic landscape?
Wall Street economists and analysts may be confident about future prospects, but I have yet to see one of them effectively address any of these three concerns which most impact Main Street.
Posted by Larry Doyle on March 31st, 2009 11:42 AM |
While recent housing data has shown a pickup in home sales and housing starts, albeit from very low levels, data released this morning showed no stability in home prices. The WSJ reports:
Most of the nation appears to remain on a downward path, with all of the 20 metro areas reporting annual declines, and nine… falling more than 20% in the last year,” said David M. Blitzer, chairman of S&P’s index committee. Both composite indexes and 13 of the 20 metropolitan areas reported record year-over-year declines.
As of January, the 10-city index is down 30% from its mid-2006 peak and the 20-city is down 29%. The two indexes have fallen every month since August 2006, 30 straight.
The indexes showed prices in 10 major metropolitan areas fell 19.4% in January from a year earlier and 2.5% from December. The drop marks the 10-city index’s 16th-straight monthly report of a record decline.
In 20 major metropolitan areas, home prices dropped 19% from the prior year, also a record, and 2.8% from December. (more…)
Posted by Larry Doyle on March 21st, 2009 10:07 AM |
Our economy, markets, and global finance are impacted by a wide array of factors. While various analysts will focus on the differing magnitudes of a variety of these factors, I know of nobody who would not say that ultimately the greatest factor of all is “confidence”. While there is a monthly Consumer Confidence Survey generated by the University of Michigan, confidence is not measured by hard data.
Regrettably, we are currently suffering a crisis of confidence. The crowd in Washington has not helped instill confidence with its scattered approach to legislation and policy.
Over and above the problems in Washington, our global economy is suffering from increasing protectionist measures. Our current administration may talk about free trade and open markets, but their actions speak otherwise. Those actions impact global confidence. Other countries and regions are equally guilty of the same issues. (more…)