ABC News reported late yesterday that its weekly consumer sentiment index
fell to -5 from -2 the previous week (readings below zero indicate that a
majority of responses were negative).
The index gave back all of the
previous week's gains, but it is still above its one-year average of -7,
which makes this latest decline look benign.
It is notable, however, that
there was another decline in the subindex on personal finances, which
matched its lowest level since last October at +18. A decline in such an
assessment emanates from a change in one's wherewithal to spend and is more
important than any change that occurs in expectations about the future.
If the trend continues, it would make sense to forecast some slippage in
consumer spending. Sentiments in this regard might turn higher in the
coming weeks if equities hold up.
P.S. Will you be there when Cramer makes his next move?
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Economy Credit Crunch Is a Sham 3/19/2007 1:24 PM EDT Fed data show bank credit is still expanding.
Economy China to Raise Interest Rates 3/17/2007 11:01 AM EDT The People’s Bank of China will raise rates 27 basis points to restrain that country's torrid growth.
Economy G7 Officials Press China on Yuan 2/10/2007 8:28 PM EST After a two-day meeting, they say a move in the Chinese currency would be desirable.
Tony Crescenzi is the chief bond market strategist at Miller Tabak + Co., LLC, and advises many of the nation's top institutional investors on issues related to the bond market, the economy and other macro-related issues. At the request of the Federal Reserve, Crescenzi is a regular participant in the board's Livingston Survey of economic forecasters. He is also the author of the revised investment classic, The Money Market,
first published in 1978 by Marcia Stigum, and The Strategic Bond Investor. At the time of publication, Crescenzi or Miller Tabak had no positions in the securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Crescenzi also is the founder of Bondtalk.com, a popular Web site covering the bond market and the economy. Crescenzi appreciates your feedback; click here to send him an email.
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