Because consumer spending is so important – accounting for roughly two-thirds of U.S. economic activity – reports of weak consumer confidence are especially troubling.
Unfortunately, current consumer confidence in the United States is extremely weak.
In October, consumer confidence fell to its lowest level in about two and a half years, according to the Conference Board, the organization that compiles the consumer confidence index. The index hit 39.8 – which is down from 72 just last February and is much lower than what economists had been expecting for October.
To put those figures in perspective, the economy is considered to be in good condition if the consumer confidence index is around 90. Our nation is currently at less than half that level!
And the gloomy numbers come at a bad time: right before the holiday shopping season gets under way in earnest. Shoppers who are worried about the economy are likely to do less spending, further reducing hopes for job creation.