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Wednesday, April 29, 2009


april consumer confidence

as black as it was, a rebound was perhaps inevitable. the april report from the conference board:

The Conference Board Consumer Confidence Index™, which had posted a slight increase in March, improved considerably in April. The Index now stands at 39.2 (1985=100), up from 26.9 in March. The Present Situation Index increased to 23.7 from 21.9 last month. The Expectations Index rose to 49.5 from 30.2 in March.

the glimmer of hope from december that may have corresponded to at least a local low -- see the positive PCE in today's q1 GDP release -- has blossomed into a 26-point positive differential. this is a distinct indication of recovery in consumer spending. context here.

UPDATE: more analysis from david rosenberg via zero hedge and calculated risk regarding the investment picture. rosenberg points out that consumer spending is still anemic and likely to continue to deteriorate under the influence of unemployment; CR notes that residential investment, a normal cyclical leader of economic activity, bottomed but is likely to remain depressed thanks to inventory issues in housing.

UPDATE: yet more via zero hedge from rosenberg.

While most of the post-Lehman collapse in spending, output and credit supply is behind us, we would advise investors to view the consumer rebound in 1Q as 'noise' or a blip in what is still very likely going to be a secular (multi-year) downtrend.

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