Way back last month, consumer confidence in the US soared the most since “stimmy” was a hashtag and Joe Biden was a popular president. (Ah, the good ol’ days.)
Fast forward a month and the mood improved further, according to the Conference Board. The headline for November was 111.7, the highest since July of 2023. Last month’s reading was revised up.
The cutoff for responses was the 18th, so there was ample time for Americans to incorporate the election results into their subjective assessments.
November’s uptick came courtesy mostly of a near five-point increase in the Present Situation Index, but the expectations gauge edged higher to, and at 92.3, it’s well above the 80 line which historically serves as a recession harbinger.
Do note: That expectations print was the best since December of 2021, even as consumers felt “slightly less positive about future income,” as Dana Peterson put it. “The proportion of consumers anticipating a recession over the next 12 months was the lowest since we first asked the question in July 2022,” she added.
I’m going to say a lot more about this in the next monthly letter, tentatively titled “Bad Guys,” but I think the country’s entering a very perilous period, not necessarily from an economic perspective — although maybe that too — but from a national security perspective, and also through the lens of individual liberties and privacy. In my view, America’s in more trouble than a lot of voters understand, and maybe more trouble than the President-elect understands for that matter.
In the meantime, though, it’s nice that people are happy. Seriously. I’m not being sarcastic. It’s been a rough decade already for far too many Americans, and those folks deserve a break, psychologically and economically. I hope the newfound optimism doesn’t prove misplaced, but I fear it ultimately will.
The labor differential in the Conference Board release hit a five-month “best” and year-ahead inflation expectations were the lowest since March of 2020. Still, Peterson remarked, “elevated prices remain top of mind.” When responding to this month’s special questions, consumers “overwhelmingly selected higher prices as their top concern and lower prices as their top wish for the new year.”
Are you saying it’s maybe a good time to start learning Russian?
Ima say some fun things in the Monthly Letter.
Please. Trump’s coterie of stooges will give the Harding Administration a run for the money on corruption, but the real danger, I fear, comes from Musk, Thiel, and Putin.
ask yourself why so many Russians are buying large trucks and starting moving companies in the USofA?
The proposed tariffs on food products from Mexico and Canada will help drive down inflation.
As will the absence of workers for US food producers.
Let’s suppose inflation re-accelerates. What does the Federal Reserve do?
See comment under Engineer below.
America just needs to queue up that 90s classic King of Wishful Thinking and have ourselves a party!
The motivated reasoning around economic and just general optimism is kind of blowing my mind right now. I agree with you, I’m not so mentally unfit as to wish hardship on people because I think they’re idiots, I hope everything goes great and the economy rips and whats-his-face-oil-guy going in as energy sec deregulates nuclear and saves the environment and we all make a shitload of money and evil men the world round end their wars to own the libs and make trump look good. But again. I don’t know man. With some concessions that a few of the cabinet picks are not reality TV level horrendous, these aren’t serious people running the show and I’d prefer they didn’t have a very large influence on our stability and safety.
How does a person encourage your thoughts in the general population?
Lessons from historical philospher’s indicate the Orange ones achilles heal may be FREEDOM. Since his playbook involves taking away freedoms from everyone and instilling fear.
He might be deposed by the very people who elected him. This can happen quickly almost without warning.
Not sure of that. If there is a tariff on day one, the food we get from there is larger than you might think.