Hell to the yeah, people are spending money again!
Consumer confidence surprises many and surges in August, according to today’s report from the Conference Board’s Consumer Confidence Index. The Index rose to 101.5 (after July’s dismal reading of 91.0), beating economists’ projections of 93.3. This month marks the highest point since November 2007, welcome news to business owners looking for consumers’ wallets to finally pry open a bit.
The report indicates that consumers are more upbeat, as the years-long choke hold of uncertainty is beginning to ease. Consumers are feeling better about the near future, but universally, income expectations did not improve (perhaps just having a job is an improvement for many Americans). Those who viewed jobs as “plentiful” increased from 19.9% in July to 21.9% in August. Those who viewed jobs as “hard to get” decreased from 27.4% in July to 21.9% in August.
But didn’t the stock market crash?
Yesterday’s stock madness has many feeling uneasy this week, but shouldn’t. First, the opening sequence was rough after China’s market begins to correct, which is good in the long run as their manipulation of their currency has hurt the global economy for years (I’m sure you’ve heard Trump mention that a few times).
Second, your retirement account is most likely comprised of stocks you’ll hold for years, so the people most impacted by the fluctuation were day traders who buy and sell several times in a day, not over a lifetime – they’ll rebound.
Third, the turmoil will be offset by the plummeting in oil prices trading under $40/barrel, leaving cash in consumers’ pockets (and more optimism)!
Car and home sales rebounding
In July, new home sales rebounded, although starts and permits are down, and existing home sales rose for the third consecutive month, leaving low inventory levels and affordability as the remaining housing challenges. Auto sales have been steadily improving for months as lending conditions loosen, albeit slightly.
Consumers are hearing more consistently positive news, making it slightly easier to open their wallets, so business owners, rejoice! The economic crash has been over for a bit, but consumers’ mentality is catching up as we all recover together. Consider this the noose loosening.
