Last week, Reuters polled its economists and determined that the US would not see any significant growth for at least the next year, thanks to mostly poor economic indicators this summer. For some reason, though, Reuters must have somehow expected consumers to remain optimistic after that assessment. When Reuters reported today on a drop in consumer confidence to a low not seen in more than a year, the report features their favorite adverb:
Consumer sentiment unexpectedly worsened in early September to its weakest level in more than a year, as distress over jobs and finances intensified among upper-income families, a survey released on Friday showed.
The Thomson Reuters/University of Michigan’s preliminary September reading on the overall index on consumer sentiment came in at 66.6, down from 68.9 in August.
“Confidence edged downward in early September, as consumers judged prospects for the national economy less favorably,” the survey’s director Richard Curtin said in a statement.
The latest sentiment figure was the lowest since August 2009 and fell short of the median forecast of 70.0 among economists polled by Reuters.
Did they bother to read their previous report? Reuters’ survey showed a prediction of 1.8% GDP growth in the third quarter and 2.7% GDP overall in 2010, with a prediction of even less growth in 2011 at 2.4%. That range of growth means no real job creation, which means lasting unemployment and downward pressure on demand and sales, as well as continued trouble in the housing markets. And they really expected consumer confidence to rise after making those predictions?
It’s not the only use of “unexpectedly,” either. Reuters also reports that consumer expectations “unexpectedly” fell almost four points from August’s 62.9 to 59.1, lowest since March 2009 … even though last week they had reset their own expectations. Their economic indicator barometer only moved a tenth of a point upward at 78.4, below their forecast of 79.0. The long-term consumer outlook index dropped ten points in a month to 59, worst since April 2009.
With consumer sentiment rapidly souring back to the levels of the beginning of the Obama administration and 111th Session of Congress, Democrats are in a very bad position for the upcoming midterms, with very little time for improvement. Voters will likely replace many of the Democrats currently serving. Perhaps Reuters should replace some of their analysts as well.
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