The last of the chain of dead men walking who have been heroically propping up a fissured US economy during the last half year appears to have taken a hit. hardly surprising really given all the confidence shaking news that's been going the rounds from Wall Street and elsewhere recently, including the less than clear business conduct sheets of both president and vice-president. One things for sure, with all the money that went into profit boosting in the last few years, you would have to be extremely optimistic to believe that the outlook for profits during the next couple was likely to be spectacular.
U.S. consumer sentiment tumbled in early July as a stock market drubbing that took major indexes to multi-year lows roused Americans' fears for the future but failed to shake their assessment of the current situation. The University of Michigan's preliminary consumer sentiment index fell to its lowest level since November 2001 in July, down to 86.5 from 92.4 in June, market sources said on Friday.
"The drop overall has negative implications for consumer spending as it is being paired with indications for sluggish employment and income growth," said Paul Ferley, assistant chief economist at Bank of Montreal/Harris Bank.The preliminary current conditions index, which tracks consumers' views about their present financial situation, fell only slightly, to 99.0 in early July from 99.5 in June. The expectations index, meanwhile, which measures attitudes about the 12 months ahead, plunged to 78.5 in early July from 87.9 in June. That was also the lowest level for this subcomponent since November.
"The survey is telling us a story of the stock market decline contributing to the souring of consumer attitudes about the future, with survey respondents acknowledging that the economic reality on the ground is still decent," said Anthony Karydakis, senior financial economist at Banc One Capital Markets in Chicago.
Source: Yahoo News