Consumer confidence hits bottom

SANDY PARKER REPORT, VOL. 32, ISSUE 34, NOVEMBER 3, 2008
The following extract is reproduced with permission from Sandy Parker Reports, Weekly International Fur News. Sandy Parker has been covering the fur industry for more than four decades. For most of that time he has published a weekly newsletter, detailing results of international pelt auctions, wholesale price trends, business developments and movements in the trade, as well as economic and political activities that may impact on it.
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International Fur News
with Sandy Parker
Consumer confidence hits bottom
THE CONTINUING TURMOIL ON WALL STREET and in other financial markets around the world is further exacerbating the discomfort of retailers, who already had downsized their expectations for the upcoming holiday season. Especially furriers and retailers of other luxury goods and non-necessities whose hopes are further dimmed by the likelihood that consumers will be less willing to spend as they see their retirement accounts battered – if not demolished – by the year-old downward trend in the stock market.
LAST WEEK’S ANNOUNCEMENT THAT THE INDEX MEASURING CONSUMER CONFIDENCE in the U.S. economy had plummeted to an all-time low came as no great surprise. The drop in confidence was widely expected, given all the bad financial news that was generated in October. Still, the index plunge to 38.0 (1985=100) from 61.4 in September was well below the reading of 51 that many analysts had expected. Of the two components, the present situation index fell to 41.9 from 61.1 in the previous month and the expectations index dropped to 35.5 from 61.5. The monthly survey for the Conference Board is based on a sampling of 5,000 households.
The impact of the financial crisis over the past several weeks has clearly taken a toll on consumers’ confidence, said the Board’s research director Lynn Franco. The 23.4-point decline is the third largest in the history of the series and the lowest reading on record, she noted.
Looking ahead, Franco commented, consumers are extremely pessimistic and a significantly larger proportion than last month foresees business and job conditions worsening. “Their earnings outlook, as well as inflation outlook, is also more pessimistic and this news does not bode well for retailers who are already bracing for what is shaping up to be a very challenging holiday season.”
IN THIS ISSUE:
Consumer Confidence Hits Bottom
Holiday Sales Seen Suffering
Season Outlook Called Cloudier
But U.S. Dollar Gets Stronger
All Eyes on Russia, China
For extracts from back issues of Sandy Parker Reports see News Index. Subscribers can access an archive of complete issues at www.sandyparker.com.
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