Consider this both corroboration of the decline in consumer spending over the past few months and a harbinger of more of the same ahead. Gallup routinely polls on consumer confidence, which has been in short supply over the last two years. After some initial improvement in the first quarter, buyers have returned to a level of pessimism not seen since the spring of 2009:
Gallup Daily tracking finds Americans’ confidence in the economy significantly lower so far in July than in June. And confidence in June was, in turn, down from May. The Gallup Economic Confidence Index for July 1-13, at -35, is lower than any monthly average in more than a year. …
The decline in confidence seen in recent months is owing primarily to mounting public skepticism with the economy’s direction. Thus far in July, 30% of Americans, on average, have said the economy is getting better and 65% have said it is getting worse, for a net -35 economic outlook score. This is down sharply from -13 in April.
By contrast, the net percentage of Americans calling current economic conditions “excellent” or “good” rather than “poor” is averaging -36 so far this month. This is only slightly below the -30 recorded in April and is comparable to the level seen for much of 2009 and early 2010.
The overall chart shows the progression:
The good news is that the decline mainly comes from consumer assessment of the future, not of the present. Even that’s tempered by essentially a flat line in consumer views of the present, which is at -36, down from -30 in April but essentially the same as it had been for most of 2009. The view of the future, however, hit its lowest level (-35) of the Obama presidency, plummeting from a high of -13 three months ago.
Gallup reports that the data started declining seriously in late June, with a serious hit on the stock market but also after reports of the collapse in the housing market, mortgages, and jobs. Perhaps not coincidentally, that also came at the same time as the White House’s “Recovery Summer” campaign, intended on convincing people not to trust their own two eyes but to cheer the hell up. Recovery Summer looks as successful thus far as Gerald Ford’s Whip Inflation Now (WIN) campaign, and just as economically impactful.