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Entries in Langer Research Associates (4)

Tuesday
Feb012011

Consumer Sentiment: Struggling Forward

Photo Courtesy - Getty Images(NEW YORK) -- Consumer views of current economic conditions resumed their struggle forward this week, with the weekly Consumer Comfort Index inching back near the high end of its recent range.

The index stands at -41 on its scale of -100 to +100, far below its 25-year average, -14, and indeed still below -40, where it’s been mired for a record 146 weeks. But, despite ups and downs, there are several indications of gradual advance:

    * The CCI was below -41 for all of 2009 and reached -41 just three times in 2010 -- but it’s already matched or exceeded this level twice in just the first month of 2011.

    * While the index averaged -48 in 2009 (its lowest on record), it advanced slightly to -46 in 2010, and so far this year has averaged -43 -- small progress, but progress nonetheless.

    * Since hitting its record low, -54, in December 2008, the CCI has correlated with the passage of time at a robust .61; as the weeks have passed, it’s slowly gained.

    * Last month’s economic expectations measure -- maintained separately from the current-sentiment CCI -- was its least pessimistic in more than eight years.

    * The index correlates with the Dow Jones Industrial Average at a remarkable .83 (after detrending for time) -- and the Dow Tuesday closed above 12,000 for the first time since June 2008.

The CCI, produced by Langer Research Associates, is based on Americans’ ratings of their personal finances, the buying climate and the national economy. Forty-six percent now rate their finances positively, matching its average last year, and 28 percent call it a good time to buy things, a scant 2 points above its 2010 average. While just 14 percent rate the national economy positively, that’s 4 points better than its 2010 average, and has been in double digits for 12 weeks straight, matching the longest run in double digits (set last spring) since fall 2008.

Even with the general upward trend, there could be a long road ahead. After the last major recession in 1991-92, it took the CCI more three and a half years to reach its pre-recession levels. Now, given how low it’s been and how slowly it’s advancing, it would take the CCI 10 years at this pace to regain its current long-term average.

Copyright 2011 ABC News Radio 

Tuesday
Jan182011

Edge in Optimism Hits an Eight-Year High

Photo Courtesy - Getty Images(NEW YORK) -- Economic optimism exceeds pessimism by the widest margin in more than eight years in this week’s ongoing Consumer Comfort survey, a fresh sign of improvement in public views of the nation’s economy -- but with continued challenges also clear.

Thirty-three percent of Americans now say the economy’s getting better -- the most since January 2004 -- while just 23 percent say it’s worsening -- the fewest even longer back, since March 2002. That 10-point edge in optimism is its biggest since that 2002 poll.

Recent economic news likewise is punctuated with gains and setbacks alike. Employment has shown progress, with weekly initial jobless claims dropping to more than a two-year low early this month, and December unemployment slipping below 9.5 percent for the first time in more than a year. But weekly claims have risen the past two weeks.

Similarly, retail sales rose in December for the sixth consecutive month, according to data released last week. But, while nearly eight percent higher than a year ago, these gains were smaller than expected, and smaller than they’d been the previous two months. 

The CCI ratings have a long way to go. Just 27 percent call it a good time to buy things and 45 percent rate their personal finances positively -- both within a point of their 2010 averages. For the second week in a row 13 percent rate the national economy positively -- a result mirrored in an ABC News/Washington Post poll released earlier Tuesday. While hardly robust, this is the most it’s been in more than two years.

Copyright 2011 ABC News Radio

Tuesday
Jan112011

Consumer Confidence Jumps to Two-and-a-Half-Year High

Photo Courtesy - Getty Images(NEW YORK) -- Consumer confidence jumped to its highest level in more than two and a half years this week, led by improved ratings of the buying climate and national economy.

The Consumer Comfort Index advanced by five points, a sharp one-week gain that’s been matched or exceeded only 24 times in more than 1,300 weeks of ongoing polling since late 1985. It follows a mid-December drop in economic pessimism, measured separately, to a six-year low.

Shifts this big do not always mean continued improvements in consumer sentiment down the road. But one particular data point offers hope: A five-point jump in the CCI in March 1993 marked the start of the index’s climb out of the 1990-91 recession and its hangover. Still, it was a long road; the CCI didn’t regain its pre-recession level until November 1994.

This advance follows last week’s report that unemployment fell to 9.4 percent in December, its lowest since July 2009. That in turn followed a dip in weekly initial unemployment claims for the last week of December to their lowest since July 2008. (Last week’s report, though, worsened.) As noted last week, the CCI correlates closely with unemployment as well as with a variety of other indicators. (One, the Dow Jones Industrial Average, rose 11 percent last year.)

This week’s jump in confidence occurred chiefly among groups that often are hit hardest by unemployment. The CCI reached its best in more than two and a half years among adults who are under age 34, singles and Democrats, and also has risen among unmarried adults, renters and low-earners. It’s matched a two-and-a-half-year high among women as well.

The CCI, produced by Langer Research Associates, is based on Americans’ ratings of the current national economy, the buying climate and their personal finances.

Copyright 2011 ABC News Radio

Tuesday
Dec212010

Consumer Confidence: Cue the Holiday Cheer

Photo Courtesy - Getty Images(WASHINGTON) -- A bit of holiday cheer arrived on cue this week: Boosted by a brightening outlook among Republicans, consumer confidence advanced to match its yearlong high.

The result follows last week's decline in economic pessimism, which fell to its lowest in six years. While it's hardly time to break out the bubbly, together the two mark the first better-than-bad results in consumer sentiment in a long while.

The ABC News Consumer Comfort Index (CCI), produced for ABC News by Langer Research Associates, has risen four points in the last two weeks to -41 on its scale of +100 to -100, five points above its 2010 average and nine points above its low for the year, last seen in early August. Nonetheless, the CCI is still far below its 25-year average, -14. And previous rallies have faltered: The index hasn’t risen above -40 since April 2008.

This week's results mark growing gaps in consumer sentiment among income and partisan groups, as well as by gender -- including a surge among Republicans celebrating their success in the 2010 Midterm Elections. The CCI is now -27 among Republicans, a two-year high -- up a dramatic 21 points since early October, up 11 points in three weeks, and 14 points above its 2010 average.

Among people with household incomes of more than $100,000 a year, the CCI is +11, staying in the black for the fourth week in a row and 15 points above this year's average.

The CCI stands at -27 among men -- nearly a three-year high and 13 points above the 2010 average -- while among women it's -55, its lowest since April. Although the index typically is higher among men, the current 28-point gap is its sharpest in three and a half years.

This gender difference likely is partially attributable to the rise in confidence among Republicans and the wealthy, two disproportionately male groups -- perhaps both celebrating the rising stock market and the continuation of Bush-era tax breaks for all income levels, as well as the GOP's re-taking control of the House of Representatives.

Democrats and those who make less than $50,000 a year are far less merry, with CCI readings of -49 and -62, respectively.

The index is based on Americans' views of the national economy, the buying climate, and their personal finances, and while none of the individual stats are particularly good, all have been worse in the recent past. Positive ratings of the economy and personal finances held steady this week, at 12 percent and 48 percent, respectively. Ratings of the buying climate improved slightly, with 28 percent calling it a good time to buy, a 10-week high -- just in time for the holidays.

Copyright 2010 ABC News Radio







ABC News Radio