(snip)" NEW YORK, Oct 23 (Reuters) - The confidence of American consumers fell to a six-week low in the latest week as higher gasoline prices and credit concerns continued to erode the economic outlook, a poll showed on Tuesday.
The ABC News/Washington Post Consumer Comfort Index fell to -17 in the latest week from -13 in the previous period. The measure ranges from -100 to +100; its 2007 average is -8 and the 2007 low, hit in August, is -20.
"Gasoline prices rose by six cents to $2.82 per gallon, and the subprime loan fallout continues to shake the stock, credit and housing markets alike," the news outlets said in a statement.
The three components of the ABC/Washington Post index were lower compared with the previous week.
Americans' positive views on the national economy and on the buying climate both fell 2 percentage points, to 34 percent, and views on their personal finances were off 3 percentage points, to 56 percent.
Confidence measures are generally viewed as a barometer of consumer spending, which accounts for two-thirds of the U.S. economy. However, economists note that consumers do not always act in accordance with their statements to surveys."(snip)
The US 'consumer' is notoriously short-sighted. Thus the short term spike in oil / heating oil / gasoline prices draws red flag attention. However, there is lots of other data which indicates that US consumers are being forced to reallocate a stagnant or declining amount of after-tax dollars earned (thanks to tiny raises and big state and local tax increases) away from 'discretionary' spending in order to continue funding 'necessary' spending.
(snip)" Since April, when investors voiced optimism that the housing slide had been contained, shares of the country's biggest department store chains have fallen by about 30 percent.
With the sagging prices, investors have rendered a harsh judgment on the coming holiday shopping season, predicting that consumers will severely cut back on spending.
The gloom since April 20 has been spread evenly across the big chains: shares of J. C. Penney are down 33 percent, Macy's by 27 percent, Kohl's by 28 percent and Sears by 28 percent.
Robert J. Barbera, the chief economist of the Investment Technology Group, said, “The conventional wisdom of a year ago was that we would have a soft landing in housing.” But today, he said, “the stock market message is a hard landing for housing, with clear damage to consumer discretionary spending.”(snip)
(snip)" Economic slowdowns traditionally hurt stores catering to a less affluent customer base, like Wal-Mart and Target. But in a reversal, those discount chains have not done as poorly as department stores.
“The problems have crept up the consumer food chain,” said Bill Dreher, an analyst at Deutsche Bank Securities.
Behind the falling stock prices are slipping sales at stores.
After a strong performance early this year, sales at department stores open at least a year have fallen three of the last six months, according to Deutsche Bank.
The stores have blamed a variety of factors, like an unseasonably warm August and September, which hurt back-to-school clothing sales, and poor sales of household goods, tied to the slowing housing market.
Sales at Macy's and J. C. Penney have fallen five of the last six months. Kohl's sales have fallen four of the last six. "(snip)
remember ladies that lap dances clearly fall in the category of 'discretionary' spending ! The data showing that 'middle class' stores i.e. Penneys & Macy's have been hit by larger cutbacks in customer spending than the 'working class' stores i.e. WalMart and Target will probably directly translate into similar cutbacks in spending by 'middle class' strip club customers.



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Interesting thread, but statistics can be flawed.

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