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Economy Title: Consumer Confidence in U.S. Falls More Than Forecast June 29 (Bloomberg) -- Confidence among U.S. consumers declined in June more than forecast as Americans became pessimistic about the outlook for the labor market and the economy. The Conference Board’s confidence index slumped to 52.9 this month from a revised 62.7 in May, figures from the New York-based private research group showed today. The median forecast called for a drop to 62.5, and the gauge was lower than all projections in a Bloomberg News survey of 71 economists. Job growth that may be slow in bringing down the unemployment rate and declining stock prices tied to Europe’s debt crisis threaten to restrain consumer spending. The lack of stronger gains in the biggest part of the economy reinforces the Federal Reserve’s forecast for a “moderate” recovery. “The job market hasn’t taken off quite as much as people had hoped,” said Guy LeBas, chief fixed-income strategist at Janney Montgomery Scott LLC in Philadelphia. “With borrowing broken, consumers simply don’t have the same incentives to be aggressive spenders.” Stocks extended losses and Treasury securities rose after the report. The Standard & Poor’s 500 Index fell 2.3 percent to 1,049.69 at 10:15 a.m. in New York. The 10-year Treasury note rose, pushing down the yield to 2.98 percent from 3.02 percent late yesterday. Today’s report runs counter to the final reading of the Thomson Reuters/University of Michigan index, which showed its confidence level rose to 76 this month from 73.6 in May. Home Prices A separate report today from S&P/Case-Shiller showed home prices in 20 U.S. cities rose in April as sales got a boost from a tax credit. The group’s index of property values climbed 3.8 percent from April 2009, the biggest year-over-year gain since September 2006. Estimates in the Bloomberg survey before today’s confidence figures ranged from 59.5 to 65. The Conference Board measure lags the 97 average of the most recent expansion, which ended in December 2007. The group’s measure of present conditions decreased to 25.5 in June from 29.8 a month earlier. The gauge of expectations for the next six months dropped to 71.2 from 84.6. Both gauges were the lowest in three months. The percent of respondents expecting more jobs to become available in the next six months decreased to 16 in June from 20.2 the previous month. The proportion who expect their incomes to rise over the next six months declined to 10.6 percent from 11.4 percent. Jobs Hard to Get The share of consumers who said jobs are currently plentiful dropped to 4.3 percent from 4.6 percent. Those who said jobs are hard to get increased to 44.8 percent from 43.9 percent. Gains in the labor market have been slow to take hold. While the U.S. has created jobs every month this year, companies in May added the fewest number of workers in four months. A report yesterday showed spending rose less in May than incomes. Purchases increased 0.2 percent last month, while incomes climbed 0.4 percent, according to figures from the Commerce Department. The savings rate rose to 4 percent, the highest level in eight months. Consumers’ plans to buy automobiles, appliances and homes declined in June. The percentage of people who said they intend to buy a car dropped to 3.7 percent, the lowest since records began in 1967. Vacation plans also fell. ‘Increasing Uncertainty’ “Increasing uncertainty and apprehension about the future state of the economy and labor market, no doubt a result of the recent slowdown in job growth, are the primary reasons for the sharp reversal in confidence,” Lynn Franco, director of the Conference Board Consumer Research Center, said in a statement. “Until the pace of job growth picks up, consumer confidence is not likely to pick up.” Some U.S. companies are looking to overseas sales to maintain profits. Nike Inc., the world’s largest maker of athletic shoes, last week posted a 53 percent gain in fiscal fourth-quarter profit as sales grew in North America and emerging markets. The Beaverton, Oregon-based company has offset slowing growth by expanding in Asia and South America. Chief Executive Officer Mark Parker highlighted the growing middle class in China, India and Brazil last month as a key to the company’s plan of increasing revenue more than 40 percent in the next five years.
Post Comment Private Reply Ignore Thread Top • Page Up • Full Thread • Page Down • Bottom/Latest Begin Trace Mode for Comment # 8.
#8. To: war (#0)
The Obama Depression.
#9. To: no gnu taxes (#8)
Yep. Even Paul Krugman, noted liberal nutcase, says it.
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