Dont worry about these surveys, these are just for entertaining purposes..... Consumers' mood grim in May: survey Friday May 16, 9:57 am ET NEW YORK (Reuters) - Consumer confidence tumbled to its lowest in 28 years this month, a survey showed on Friday, as short-term inflation expectations hit their highest since the stagflationary early 1980s. The news heightens the dilemma for the Federal Reserve, which has bet that slowing economic growth will tame inflation pressures that are building up. The Reuters/University of Michigan Surveys of Consumers said its preliminary index of confidence fell to 59.5 in May, its lowest since June 1980. In April it was 62.6. "Consumer confidence continued to slip in early May due to surging food and fuel prices," the Surveys of Consumers statement said. "Record numbers of consumers viewed the economy in recession and saw little hope of recovery anytime soon." This was well below economists' median expectation of a reading of 62.0, according to a Reuters poll. One-year inflation expectations surged to 5.2 percent -- their highest since February 1982 -- from 4.8 percent in April. Also worrying for policymakers at the Federal Reserve, five-year inflation expectations hit their highest since August 1996, edging up to 3.3 percent from April's 3.2 percent. The inflation measures challenge the Fed's view that soaring commodity prices have not yet led to an increase in long-term inflation expectations. Coupled with the concerns about growth, the report also fuels worries that the U.S. is sliding into a period of stagflation like the late-1970s and early 1980s, characterized by a sluggish economy and accelerated price growth. The index of consumer expectations came in at 51.7 in May, the lowest since October 1990, amid the runup to the first Gulf War. In April it was 53.3. The Surveys of Consumers also said the data indicate that consumption growth is likely to be 1 percent in 2008, "with the pace weakening in late 2008 and early 2009."
Too much consumer confidence is chained to the Dow these day; at least in my opinion. It seems in the last couple of years that consumer confidence reports rise after the Dow rises and falls after the Dow falls. Now that the market has demonstrated at least a phase of stability, the next Consumer Confidence report will probably be up. That and the tax rebate checks will factor in. I don't pay very much attention to consumer confidence surveys, I just watch people shopping. Lots of real shopping equals good economy. Not too many folks in stores and fewer shopping bags in hand, not so good economy. I call it the W.I.F.E Effect: Wall-Street Index of Female Expenditures. Pete