Unstable buildings lead to improved consumer confidence
Americans feel better about the economy than they have in years. Or at least the Democratic Party does.
consumer confidenceAs measured by The Conference Board’s monthly survey, it surged to a two-year high in January, marking the third straight month of increases. Ratings of current economic conditions rose to their highest level since March 2020. The economic outlook for the next six months rose more modestly to its highest level in six months.
A similar poll conducted by University of Michigan showed last week that consumer sentiment reached its highest level since July 2021, again helped by increased positivity about both the current situation and the economic outlook.
Gallup Economic Confidence Index is also on the rise. It has reached two-year highs in the past two months. The voting organization revealed on Tuesday.
All these measures of consumer confidence Still lagging behind pre-pandemic conditions under President Donald Trump. They still paint a picture of the American public that is more pessimistic about the economy than usual by historical standards. However, the trend is definitely improving.
Improving confidence is a bit of a mystery. The unemployment rate has remained fairly low for some time. Job creation is strong but slowing. Inflation has come down from very high levels, but the latest figures show progress is stalling, with month-on-month price growth higher in December than the previous month.
To be sure, there have been some developments that could boost consumer sentiment about the economy. Mortgage interest rates have fallen From the highs seen in October. House prices and the stock market are rising.
During December, federal reserve system That seems to indicate it is ready to reverse some of the rate hikes of the past year and a half. Retail sales in December were stronger than expected, and the number of employees and job openings also increased markedly.
Dana Peterson, chief economist at the Conference Board, said: “January’s rise in consumer confidence is generally positive as inflation slows, expectations for lower interest rates going forward, and businesses continue to hoard labor.” “This is likely to reflect the current employment environment.”
Unfortunately, it can be a weak construct to boost consumer trust. The very sources of strength also make a resurgence of inflation more likely.
Markets are reconsidering when and how often the Fed will cut interest rates this year, largely due to very strong consumer spending and labor market data.futures market The implied probability of a March interest rate cut has declined. That’s about a 40 percent chance, up from a near certainty a few weeks ago. Market prices now suggest five, or even just four, rather than six or seven cuts. Mortgage interest rates may rise as expectations for interest rate cuts recede.
Democrats are obsessed with the Biden economy
Furthermore, a significant portion of these poll increases may simply be due to the president’s politics. A closer look at the survey results shows that Intense partisanship by the Democratic Party This underlies the significant rise in consumer confidence.
Neither the Conference Board nor the University of Michigan releases data on the political breakdown of their consumer surveys to the general public. However, the Gallup survey includes items such as: Breakdown by political party affiliationSo we see that partisan politics plays a powerful role in changing sentiment around the economy.
In a Gallup poll dating back to June, Only 6% of Republicans say they rate the economy as good. and 1 percent rated it excellent. 32% said the current state of the economy was “fair” and 61% said it was “poor.”
These numbers have not improved in the latest polls. It actually got a little worse. Two percent of Republicans say the economic situation is good, 6% say it’s good and 24% say it’s fair. 68% answered that they were “poor.”
However, some Democrats Enthusiasm about the economy exploded. In June, 32 percent I said the economy is good.now 47 percent do. This impressive number has increased from 2% to 7%. The share of Democrats who say the economy is just fair fell from 43% to 29%. The percentage of respondents who said the economy is in bad shape fell from 23% to 17%.
A similar partisan shift among Democrats can be seen in responses to a Gallup question asking whether the economy is getting better or worse. In June, 85% of Republicans said the situation was getting worse. According to the latest opinion poll, that percentage is 86%, essentially unchanged.
In June, 47% of Democrats said the economy was worsening. Only 31 percent say the situation is currently getting worse.
No one has tried harder than President Joe Biden and his minions to convince Americans that the economy is doing well or to claim credit for positive developments. They even tried to claim any improvements as the pandemic was due to: “Bidenomics” However, that label fell very flat and was almost removed.
But it could be playing into Democrats, especially as the election approaches. Or perhaps the aversion to the possibility of Mr. Trump winning a second term is strong enough to cause Democrats to take a more positive view of the current situation.
It’s hard to know exactly what drives the Democratic Party so strongly. Because the current political frenzy of the American left, as exemplified by the constant but unsubstantiated claims that democracy itself is at stake in the November election, is unlike anything we have ever seen. Because it doesn’t look like anything at all.In American politics since the era of Democrats believed the election of Abraham Lincoln meant the end of the republic.
