Consumer Confidence Tanks In June

There were two negative consumer confidence reports today.

The Conference Board’s June report shows that their Index dropped almost 3 points this month, and since April, almost 7 points. People can watch and hear the news, monitor their own situation and their neighbors’ and friend’s, and conclude that things aren’t getting better. Who knows, they may even read The Daily Capitalist.

This is their lowest reading since November, 2010.

Gallup came up with the same sentiment:

Gallup explains it as follows:

The worsening of Gallup’s economic confidence measure during June may be due in part to the dissipation of the “halo effect” surrounding the death of bin Laden. Confidence has now moved back near the April 2011 low. This suggests that the consumer benefits associated with steadily declining gas prices at the pump — down 14 cents per gallon in the past two weeks — are being offset by other factors. One such factor might just be that gas prices remain 82 cents per gallon higher than they were a year ago. Another could be the continuing dismal jobs situation.

Federal Reserve Board Chairman Ben Bernanke last week seemed to add to the growing economic pessimism, noting that the Fed has reduced its 2011 growth forecast for the U.S. economy. Wall Street continues to suffer as a result of the Fed’s apparent confirmation of the economic “soft patch” and the financial problems in Europe. The battle over raising the debt ceiling has not disrupted the money markets to this point, but certainly represents another negative for overall economic confidence.

I guess this explanation is as good as any. Such conclusions are always a bit suspicious (“Since people are negative, it must be because of X [whatever the researchers see in the headlines].”). It could be that they see the U.S. with a huge unsolvable debt problem, an unresolved debt deleveraging problem in real estate, home prices down one-third since 2006, they worry about the price of feta cheese, or that Malia Obama’s father won’t let her date. Whatever. Not even cheaper gas has cheered them up.

It is what it is. Perhaps an economic recovery would help.