American Economic Confidence Holds Its Own

According to a new poll from Gallup:

Americans’ confidence in the economy showed no change last week as the U.S. stock market’s rally slowed.

The research firm added:

Americans have been relatively more confident in the economy this year than they have been throughout the last several years.

At this point, few economists believe that growth in gross domestic product will be less than 3% this year. As for unemployment, April’s poor numbers caused many forecasts for the next few months to be averaged downward. The Federal Reserve continues to insist that a real recovery will not have begun until the jobless rate drops below 6.5%, which may be over a year away, if not longer.

The results of consumer confidence measures and the outlook people have for the economy are sometimes seen a bogus, even blue chip indices like the Conference Board Consumer Confidence Index or the Thomson Reuters/University of Michigan Surveys of Consumers. The argument goes that the methodologies of these are different, or that sample size or the types of questions are not balanced enough to reflect broad sentiment. To the extent those arguments against them are true, the measurement of what consumers will do in the near-term future cannot be accurately forecast.

However, cynicism regarding methodology does not mean that the sentiment of the work is completely false. The results of the Gallup measures have been relatively positive since early 2012, with a dip mid-year, which should be expected based on struggles that appeared then. And currently it shows an ongoing recovery, although not one that is ebullient. Not everything that is confusing is also wrong.

Methodology: Results for this Gallup poll are based on telephone interviews conducted April 1 to 7, 2013, on the Gallup Daily tracking survey, with a random sample of 3,553 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia.