Confidence among U.S. consumers unexpectedly dropped in January as gasoline prices picked up and more Americans said jobs were hard to get.
The Conference Board’s confidence index fell to 61.1 from a revised 64.8 reading in the prior month, figures from the New York-based private research group showed today. The median forecast of economists surveyed by Bloomberg News called for a rise to 68. The figure was lower than the most pessimistic projection.
Why is this a surprise? As I noted early in the month the Employment Report, which many said showed “improvement” with a +200k headline number, in fact showed job loss when one looked at the household survey, and it is actual consumers who buy actual things, not government fudge-boxes!
Of course we can’t have the truth in the mainstream media off those reports, can we? Never mind that other data has showed a contracting consumer spending appetite and more desperation as credit is being used once again in a “last gasp” attempt to avoid insolvency.
The data is all around you if you care to look — the consumer is collapsing as there has been no recovery of materiality in employment. Just look at the labor participation rate!
Wake up America. The government’s policy of ladling out “free cheese” in an attempt to prevent the adjustment of the economy back to what we can actually afford both at a government and personal level is both futile and stupid. It in fact serves only one purpose — attempting to buy votes.