Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Steve's Channelling Thread -- Ignore unavailable to you. Want to Upgrade?

To: megazoo who wrote (11762)	2/27/2001 3:52:32 PM
From: Bruce A. Thompson	Respond to of 30051

By ADAM GELLER, Associated Press NEW YORK (February 27, 2001 2:21 p.m. EST nandotimes.com) - American's increased pessimism about jobs and the economy sent consumer confidence falling in February to its lowest point in more than four years. The Conference Board said Tuesday its Consumer Confidence Index dropped to 106.8, down from 115.7 in January. It marked the fifth consecutive drop in the monthly index, which fell to its lowest point since June 1996. "Consumers are seeing all the layoff news, they're hearing all the doom and gloom comments and they've gotten worried, there's no question about it," said Joel Naroff of Naroff Economic Advisors in Holland, Pa. The pessimism was reinforced by the two reports released by the Commerce Department Tuesday. Orders to U.S. factories for big-ticket manufactured goods plunged in January to their lowest level in 19 months, the department said. Meanwhile, new-homes sales plummeted by 10.9 percent in January, the biggest drop in seven years. For now, the economy continues to walk a tightrope, avoiding a plunge into recession, said Lynn Franco, director of the Conference Board's Consumer Research Center. "The erosion in consumer confidence continues to be fueled by weakening expectations regarding business and employment conditions," Franco said. "While the short-term outlook continues to signal a severe economic downturn, consumers' appraisal of current economic conditions suggests we are still undergoing moderate economic growth and not a recession." The Conference Board index, based on a monthly survey of some 5,000 U.S. households, is considered a key indicator because consumer spending accounts for about two-thirds of the nation's economic activity. The index compares results to its base year, 1985, when it stood at 100. The overall February confidence figure was lower than the reading of 110.5 that had been expected by analysts. Still, one economist noted that some figures contained within the Conference Board's report indicate less dire concerns on the part of many consumers. "Generally, it's a weak number on the headline, but the details show a little more encouragement," said Gary Thayer, chief economist for A.G. Edwards & Sons in St. Louis. Thayer pointed to figures in the Conference Board's report showing a growing number of people believe the current economy is exhibiting normal conditions, as well as figures indicating more consumers plan to buy new homes and cars in the next six months. The new report comes amid intense speculation about whether the Federal Reserve policy-makers will cut interest rates again before their next meeting, March 20. But Thayer and Naroff said they don't believe the drop in confidence will be enough to push the Fed into taking early action. The markets were down in afternoon trading, with the Dow Jones industrial average falling 15 points to 10,625, while the Nasdaq composite index fell 68 points at 2,240. Consumers continue to be pessimistic about the outlook over the next six months, the Conference Board said. The percentage of consumers expecting a pickup in business conditions declined from 13.1 percent to 11.1 percent, while those anticipating conditions to worsen increased from 15.2 percent to 17.8 percent. In addition, only 10.2 percent of American consumers expect more jobs to become available, down from 11.7 percent last month. Those expecting fewer jobs to become available increased from 21.5 percent to 27.2 percent. But 57.9 percent of consumers now believe the current economy is exhibiting normal conditions, up from 54.8 percent last month. The numbers of people with plans to buy new homes and cars in the next six months also increased, the Conference Board reported.