Consumer Confidence "Unexpectedly Falls"

The Consumer Confidence index fell to a 10 month low of 46.0, showing signs that, going forward, American families are more worried about fixing household balance sheets and retaining employment than they are confident in economic recovery. The index fell 9.9 points from last month's level of 55.9. Wall Street estimates ranged anywhere from 50.9 to 59. Here's a little excerpt from the Bloomberg article:

"The economy “may not be out of the woods,” said Steven Ricchiuto, chief economist at Mizuho Securities USA Inc. in New York. Most of the deterioration “is labor market related. Consumer spending is going to disappoint throughout most of the year,” he said."

I don't know for sure whether I agree or disagree. The market just feels stagnant right now. There's been very little movement on the jobs front in either direction, but in general we have a manufacturing and retail sector that seem to be heating up. In particular, the consumer retail space added 42,000 jobs last month which makes me inclined to think business feels better about recovery. But with Consumer Confidence so low its hard to believe those gains in employment will be sustainable.

So a quick rundown. Last week PPI was up, core CPI was down, and now Consumer Confidence is down. This looks like a recipe for narrowing profit margins as input prices rise and consumers fail to bare the burden of the increase. Today, stocks are down accordingly for all major indexes and treasuries are up. The company I'm doing for my investment group report announces earnings today, bad news for me, it's high end retail... We'll see if the "bottom up" approach to investing advocated in the group helps me out here. From a valuation standpoint, the stock looks good, but my common sense is telling me otherwise right now. Oh well, if we ever do recover high in retail will more than likely help lead the way out. Nordstrom is up 100% in the last 10 months, good call for my updown.com portfolio.