We do not wait in line at the register to purchase it; we rarely pull cash out of our wallets, but we must pull a pen out, repeatedly, and sign many documents in order to secure a new home. Nonetheless, a home is a commodity of sorts; it is a “thing” we acquire because it is time or because we choose to do so. As such, it is subject to our moods and level of confidence.
The U.S. Consumer Confidence Index (CCI) is an indicator designed to measure consumer confidence, defined as the degree of optimism toward the economy as expressed through consumer saving and spending activities.
The Conference Board Consumer Research Center began tracking consumer confidence in 1967. The index benchmark was established in 1985, since that particular year showed neither a peak nor a trough. Thus, 1985 numbers represent 100 % and subsequent findings are rated through comparison with this benchmark.
The Consumer Confidence Survey® acquires data from a representative sample of 5,000 U.S. households. January 2011’s preliminary results, published January 25by the Conference Board, reveal, “The Index now stands at 60.6, up from 53.3 in December.”
This represents an increase of 13.69%; not a negligible change in perspective from 2010!
“Consumers have begun the year in better spirits. As a result, the Index is now near levels not seen since last spring (May 2010, Index 62.7),” says Lynn Franco, Director of The Conference Board Consumer Research Center. Indeed, the recent survey reveals that consumers have greater confidence in business and labor markets. Their responses also indicate a renewed trust that the economy is likely to expand and that more job opportunities will develop in the coming months. “Although pessimists still outnumber optimists, the gap has narrowed,” Franco points out.
Consumers’ short-term outlook was already more optimistic in January. For instance, 19% of those taking part in the survey anticipate an improvement in business conditions over the next six months. Again, a 13% increase (from 16.8 percent in December). And, the number that predicts worse conditions has decreased by about 5% (11.3 percent in January compared to 11.8 percent in December).
When we discover we have buying power, that our neighbors who had been struggling through unemployment now proudly drive off to work each morning, that local businesses whose parking lots were nearly empty for months enjoy daily traffic and sales again, this immediately informs our outlook. It sets a new momentum that inspires goals, dreams and actions because we can see that “things are working” around us.
As much as we seek to be different and unique, we naturally respond to trends, because trends are an indicator of what works in our world, our economy and our community.
Click HERE to read the full The Consumer Confidence Survey Report.