Two indicators of economic confidence announced today both show increasing pessimism about the future of the American economy.  Consumers have even less confidence than they did in August, when a downbeat report put a further damper on the Obama administration’s “Recovery Summer” public-relations spin.  In the other, the business outlook from CEOs predicts lower growth, although perhaps a glimmer of hope on capital investments.

First, consumer confidence fell to 48.5 from 53.2, as Reuters expected it to slide only to 52.5, dropping to a low not seen since February:

Americans’ view of the economy turned grimmer in September amid escalating job worries, falling to the lowest point since February.

The downbeat report, released Tuesday, raises more fears about the tenuous U.S. economic recovery. It also further underscores the disconnect between Wall Street and Main Street; consumers’ confidence fell further even as stocks rebounded in September.

The Conference Board, based in New York, said its monthly ConsumerConfidence Index now stands at 48.5, down from the revised 53.2 in August. Economists surveyed by Thomson Reuters were expecting 52.5.

The reading marked the lowest point since February’s 46.4. It takes a reading of 90 to indicate a healthy economy — a level not approached since the recession began in December 2007.

The AP includes this curious analysis:

Fears had been easing that the economy isn’t heading toward a double-dip recession amid a fresh batch of economic reports. While companies aren’t making lots of job offers, far fewer people are applying for unemployment, according to the latest figures from the Labor Department. And the nation’s trade deficit narrowed in July, due to a bigger appetite overseas for American exports.

There are a couple of problems in these assertions.  Applications for unemployment are not “far fewer” in the “latest figures” from Labor — not unless the comparison is to figures from over a year ago.  Initial jobless claims have remained stuck in a narrow, high band of values all year long.  In fact, it was just less than two months ago that the number of initial jobless claims hit a six-month high.  Also, the figures for American exports did improve in July, but only from a pretty awful June report.

Those reasons could explain why CEOs have such a bleak outlook on the economy.  And that matters because …:

U.S. chief executive officers’ view of the economy darkened in the third quarter, breaking a five-quarter streak of improvement and turning corporate America more cautious on hiring [emphasis mine — Ed].

The number of CEOs who expect their companies’ sales and U.S. headcount to rise over the next six months declined in September, a Business Roundtable survey released on Tuesday found. More bosses expect to boost their capital spending, however, reflecting many companies’ cash-rich balance sheets. …

The Business Roundtable’s CEO Economic Outlook Index declined to 86 in September from 94.6 in June, but remained well above the 50 mark, which separates forecasts of growth from expectations of decline. The CEOs’ view is still markedly improved from early 2009, when the index stood at a record low of negative 5.

The CEOs’ forecast of 2010 economic growth dropped sharply to 1.9 percent from a prediction of 2.7 percent in June.

A GDP of 1.9% for the year means that the CEOs expect two very poor quarters to finish out the year.  The annualized GDP rate in Q1 was reported at 3.7%, followed by an anemic 1.6% in Q2, which would average out to the mid-2s thus far.  It appears that these business leaders expect the kind of growth seen in “Recovery Summer” for the rest of 2010, or perhaps just a little bit less.  That’s nowhere near the kind of growth that creates opportunities for expansion and growth, which means we’ll see this level of stagnation and unemployment continuing well into 2011, if not longer.

That may not be a double-dip recession, but it’s no Recovery Summer, either.

Note: The front-page image comes from this editorial cartoon by Michael Ramirez of Investors Business Daily. Ramirez has a terrific collection of his works: Everyone Has the Right to My Opinion, which covers the entire breadth of Ramirez’ career, and it gives fascinating look at political history.  Read my review here, and watch my interviews with Ramirez here and here.  And don’t forget to check out the entire Investors.com site, which has now incorporated all of the former IBD Editorials, while individual investors still exist.