Mysterious Disappointment in Consumer Confidence

The Conference Board released its reading of Consumer Confidence was above the red-line, albeit a bit less than expected.  The reading fell to 52.5 for December, down from a revised 54.3 reading in November (originally reported as 54.1).  We were expecting a gain ourselves based upon a strong holiday season, and Dow Jones was looking for the gain to come in at 57.0.

The present situation index fell to 23.5 from a revised 25.4 in November, but that original November figure was reported as 24.0 a month ago.  That being said, the change is not as sharp as it looks on the surface.

The future expectations with a 6-month outlook was 71.9 after a revised November figure of 73.6 (originally reported as 74.2).

This was surprising when you consider the layout of the retail gains seen during the holiday season.  It seems that the overhang in the world of jobs is capping the gains in the expectations.

While many companies plan to expand marginally in early 2011, you know that the pink slips in the retail and temporary workers will escalate starting in January.  Those calling “jobs hard to get” rose to 46.8% in December versus 46.3% in November.  Those calling for “jobs being plentiful” fell to 3.9% in December from 4.3% in November.

Again, above the red-line… just very lackluster and heading the wrong direction.  It is important to remember that nearly 1 in 10in America are still officially unemployed, while about 17 of 100 in America are greatly underemployed or jobless.

JON C. OGG