There may be a temptation by some in the business media to make a big issue out of the sharp decline in the Conference Board's measure of consumer confidence. Those so tempted would be wrong.

The key point to note is that almost all of the decline was in the future expectations index. The current conditions index was essentially unchanged, edging down from 45.9 to 45.8. While current conditions index does fit reasonably well with current consumption, there is little correlation between the future expectations index and consumption. This index is highly erratic and therefore not a good predictor of consumption either present or future.

 survey banner

subscribe today!

Site Maintenance

"The CEPR website currently takes longer to load than usual. We hope to have this and other issues addressed shortly. While this much needed site maintenance is taking place, our content is still available so please continue to slooowwwly surf the pages of our site. Thank you for your patience."