Survey: U.S. Consumers Are Feeling Pretty Darn Optimistic Right About Now

We’re all a bunch of optimistic Spendy McSpendersons lately, according to a new survey that says consumer sentiment is remaining high in the new year. As more jobs are being created, consumers have lifted their collective spirits for the fifth consecutive month.

The Financial Times cites the results of the Thomson Reuters/University of Michigan index, which say we’re at our highest level since May with a score of 74 for consumer sentiment. Sure, that’s well below the 89 we had in late 2007, but progress is progress, right?

“More frequent mentions of rising employment lessened income uncertainty and prompted more favourable buying attitudes as well,” Richard Curtin, survey director, said. “The data suggest a stronger consumer spending outlook, rising to about a 2.1 per cent gain in 2012.”

Opening our wallets to spend during the holiday season pushed consumer credit up for the biggest rise in a decade, to $20.4 billion in November. Even though retail sales for December weren’t as good as predicted, we should still continue to ride the good economic feelings as the unemployment rate continues to fall.

This calls for a nationwide dance party.

US Consumer sentiment strongest since May [The Financial Times]

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  1. humphrmi says:

    I heard an analysis of this on the radio today at lunch. Basically there’s no historical correlation between the Michigan Index and actual spending increases. While we certainly need more consumer spending (amongst other things) to improve our economy, it is not guaranteed that that spending will materialize just because this indicator goes up.

    • Loias supports harsher punishments against corporations says:

      Truly, feelings do not alwasy equal actions. But the incremental jobs increase and holiday purchasing extravaganza is at least evidence that it’s correlated.

      • humphrmi says:

        I wouldn’t call holiday spending an “extravaganza”. It was more of a “meh”. It didn’t even meet analysts expectations, it was something like +0.1%. The jobs situation is something more concrete, and separate from the Michigan Index. Yes, if jobs keep getting created (or fewer lost) then people will spend more.

        • smbizowner says:

          the only spending going on in Michigan right now is for GAS, which has jumped in price by 60cent/Ga in the last 3 weeks.

  2. DariusC says:

    Too bad there isn’t anything to celebrate given the bleak job market and high prices on supplies and services. With exception to pizza… which is far better priced now than it was before the $10 any pizza deals.

  3. polishhillbilly says:

    We are?

  4. dolemite says:

    I’m feeling better about 2012. Got some bills paid off in 2011 (although a long ways to go, and probably about 15k in home repairs coming up in the next 1-3 years). Still…progress.

    • Cor Aquilonis says:

      Congratulations on your “balance sheet repair!” I will spend more this year, too, primarily because I’ve almost paid off my student loans. It should free up around $1100 per month – which is huge!*

      * Actual payments on $15,000 of student loans: $150/mo. For 15 years. Like I’m going to do that. Increased to every cent I’ve got: ~$1100/mo = speedier payoff. Nice paying them off, finally.

    • smo0 says:

      Believe it or not, I actually have good feelings about this year… even if it is an election year…

      Last year taught us a lesson, no matter who’s in charge – the public realizes they still have power and a say… it will take time and effort – but I think politicians got a nice little reminder about boundaries….

      now if only everyone were on the same page about individual privacy and rights…

  5. Cat says:

    Really?

    We’re only spending because all the stuff we put off buying has finally given out.

    • Lyn Torden says:

      And that is quite often a driving force for recovery. When a recession hits, people put off a lot of things, like home repairs, getting a new car, etc. The pressure to buy gradually increases (but not so fast as the slump downwards for a few years).

      The Republicans are right … if we use their economic ideals, the economy will recover in a few years.

      The Democrats are right … if we use their economic ideals, the economy will recover in a few years.

      It’s not about political ideals. It’s about confidence and stability. It’s about employers and consumers both concurrently seeing things to be better ahead. Them seeing things to be gloomy ahead is what put us in this mess. That’s not to say other things are not a cause as there are other factors that affect the economy. But confidence is a big one and neither party has an answer … oh wait, yes they do … but those are just strategies to push their own agendas.

      • Cat says:

        So, what you’re saying is – all we have to do is BELIEVE? I, for one, am not going on a spending spree based on some economist’s fantasy. The economy is in deep shit, and no amount of wishing it better is going to fix it.

        The republicrats are all wrong, and they can kiss my ass.

  6. gman863 says:

    Even though I’m in Houston (one of the cities hit least by the recession, I don’t buy the results of this survey for a second.

    I’m in the PC and electronics business. Between my wholesalers and friends who work at Big Box stores, the verdict is that the Holiday season was (at best) average; January is becoming a Death Valley.

    Granted, my personal debt-to-income load is about the highest it’s ever been as a result of recently starting my own business. As such, I have cut out all but the bare essentials of spending until my return on investment kicks in.

    It all goes back to that SNL skit: Don’t buy stuff you can’t afford.

  7. jjq says:

    All the American people need to do is see this propaganda, and they’ll be whipping out the plastic. If the sheeple read about recession, they will tighten the purse strings, tell ‘em “its all gonna be ok” and watch them spend. Being a business owner, I say its about time the media prints something that will have a positive influence.

    • Loias supports harsher punishments against corporations says:

      Doubt it. You can look at all the propoganda you want, but if your personal budget doesn’t warrant loosening your pursestrings, you simply won’t.

      You might get a few delusioned into wasting all their money, but not the vast majority.

      • tbax929 says:

        Agreed… although there are, no doubt, some morons out there.

        My spending habits are only reflective of my personal situation. I don’t give a rat’s ass what anyone else tells me about the economy. When I can afford, I spend. When I can’t, I don’t. It really is that simple for me.

        • Potted-Plant says:

          Me too. I don’t get articles like this at all. They say consumer confidence is up, but the only data they use to back that up is spending and a VERY modest employment bump. Gas and food is more expensive, so we’re spending more. That doesn’t inspire confidence. It inspires pessimism. And then they slip in this little gem:

          “The widening … is perhaps the first real sign that the crisis in Europe and the more general global slowdown is starting to take its toll on the US.‚Äù

          Yeah. Blue skies are here again.

  8. Duke_Newcombe-Making children and adults as fat as pigs says:

    Ah yes…let the Bacchanalia resume!

    I was hoping, just for a brief time, we were learning from the “new normal” of thriftiness and cash being King.

  9. Fantoche_de_Chaussette says:

    Americans can confidently look forward to a comfortable retirement, richly funded by out flat-broke Social Security system, our flat-broke Medicare system, and our ever-tanking stock market investments.

    And we can count on our corrupt, corporate-owned Congress to tirelessly resolve any issues that might impact poor and middle-income people who can’t afford to make million-dollar Super-PAC donations.

    With an ironclad social safety net like that, of course we should be spend, spend, spending on luxury goods!

    • Kuri says:

      We can count on needed programs to be broke, but somehow there is plenty of money going toward blowing up other countries.

      • Skyhawk says:

        I think he covered that with the ‘corrupt, corporate-owned Congress’ part.

        Who do you think are the beneficiaries of all the military spending?

        Manufacturers of military equipment and military contractors.

        You could also include under the umbrella of corrupt, corporate-owned Congress- the $billions in foreign aid, farm subsidies, bank bailouts, pork projects, and the extravagant salary, pensions, and benefits that Congress votes themselves. All paid for by money confiscated, at the point of a gun, from taxpayers.

  10. MrHeartOfGold says:

    “Spendy McSpendersons…” LOL
    Someone’s been reading Chuck Palahnuik lately.