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Consumer Confidence Drops

In a fairly important signal that consumers may well begin to retrench in their spending Consumer Confidence Index fell by a healthy 5.7 point in July to the level of 92.6.

Last month the reading was at a level of 98.3 , which was up from the low point in April and May, of 85.7. The index had hit a peak in February of 132.6.

Prior to the creation of the new ‘fake economy’ this index was one I watched closely–how could you not watch it with the consumer being 2/3rds of the economy. Now with the Fed running the printing press day and night and liquidity sloshing around everywhere even though the consumer feels lousy they have pockets full of ‘free’ money to spend.

Article on the Index

Oh well–in spite of the lack of realistic expectations by investors I will still watch this index and employment numbers as keys to the future.

Thursday we have GDP being released for the 2nd quarter–it will be ugly–everyone knows it. Also on Thursday we have the important 1st time jobless claims that day as well–if these numbers show a worsening markets may take this news badly. If the economy is to improve we can’t see 1.5 million new unemployment claims every week.

Lastly we are awaiting the new Covid package from Congress. Dems want $3 Trillion and Repubs want $1 Trillion–so you know they will end up at $2 (more or less). I suppose the markets will rally on the news of a deal–why waste a good excuse to drive prices ever higher?

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