The cheer leading by the Financial Press Continues. In this case they are reporting non-news. Even if you agreed that we are headed out of the recession, it is fairly well known that consumer confidence is not a leading indicator, and that employment usually is the last item to recover. So in a recession with an unusually long time span, people have run out of what ever money reserves they had, and are still not re-employed. So why on earth would you think that the broke and unemployed American public would be highly confident.
Only 1 American in 7 has faith a lasting economic recovery has taken hold and a plurality say they are personally worse off than they were two years ago.
Almost half of the respondents in a Bloomberg National Poll conducted March 4-7 believe the U.S. is in a “fragile” rebound and could fall back into recession. More than a third of the country believes the U.S. never emerged from recession.
Sixty-three percent of Americans say the nation is on the wrong track, compared with 66 percent who said so in December, which was the lowest in the national mood in the one and a half years the Bloomberg poll has been conducted.
The gloomy outlook contradicts economic data showing an economy on the mend, including six quarters of economic growth, a 95 percent rise in the Standard & Poor’s 500 index over the past two years and job growth last month of 192,000. The National Bureau of Economic Research officially dated the end of the recession to June 2009.
Almost half of poll respondents say they are personally worse off than they were two years ago, when the country was losing 796,000 jobs a month and the economy was shrinking at a 4.9 percent annual rate. The stock market hit its post-financial crisis low two years ago yesterday.
In a related article:“There seems to be something of a disconnect between what people are feeling and what people are doing,” says J. Ann Selzer, whose Des Moines, Iowa-based firm, Selzer & Co., conducted the poll. “While admitting a recovery has at least started, the public still feels crummy. They may not feel it has started for them.”
U.S. Families Slice Debt to Lowest in 6 YearsU.S. Families Slice Debt to Lowest Level in 6 Years, By Justin Lahart and Mark Whitehouse, Wall Street Journal.
U.S. families—by defaulting on their loans and scrimping on expenses—shouldered a smaller debt burden in 2010 than at any point in the previous six years, putting them in position to start spending more.
Total U.S. household debt, including mortgages and credit cards, fell for the second straight year in 2010 to $13.4 trillion, the Federal Reserve reported Thursday. That came to 116% of disposable income, down from a peak debt burden of 130% in 2007, and the lowest level since the fourth quarter of 2004...
But consumer debt, such as auto and student loans, has started growing again in recent months, suggesting that people might be getting in the mood to borrow again.
The consumer lending silliness we have covered. Yves Smith at Naked Capitalism made a further comment about the fact that while they go a lot into how consumers have cleaned up their balance sheet, that the article ignores the fact that their assets (like the value of their homes) have dropped dramatically in value.