From the USA Today, “Consumer confidence took the biggest tumble in 15 years in September, as Americans grappled with soaring energy prices after Hurricane Katrina, the New York-based Conference Board said Tuesday.”

“Economists said that while the September consumer confidence figures were not good news, they did not necessarily mean a dramatic slowdown in consumer spending, about two-thirds of the economy. The outlook depends on the pace of job growth and how far gasoline prices decline from recent highs of more than $3 a gallon.”

“Accept this for what it is: an emotional reaction to tragic circumstances. But are people going to stop spending? No,” says Ken Mayland of ClearView Economics.

“The decline in new-home sales followed Monday’s report that existing-home sales in August were the second-highest on record. Even with the drop in new-home sales, they were 6.2% above year-ago levels. Further, builders must replace hundreds of thousands of homes damaged or destroyed by Katrina. That will boost the industry, as well as related sectors such as furniture makers.”

“Sam Bullard of Wachovia said that, given strong fundamentals, he does not expect to see any major slowing until mortgage rates rise toward 7%.”

Thanks again to Brett for the tip on this article.

This entry was posted on Wednesday, September 28th, 2005 at 7:07 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.