Consumer confidence is at its lowest level in three months as positive ratings of the buying climate hit their worst of the year.
The ABC News Consumer Comfort Index stands at -51 on its scale of +100 to -100, the second straight week at -50 or below and down 6 points in three weeks to its lowest since mid-July. That puts the CCI in striking distance of its worst ever, -54 in January. Confidence has been this bad or worse only 16 times in over 1,240 weeks of polls, all occurring since May 2008.
The 6-point, three-week slide in confidence coincides with a 6-point drop in positive ratings of the buying climate over the same stretch. Only 21 percent now rate the buying climate positively, down from 27 percent on Oct. 4. Positive ratings of the economy and personal finances have been steadier.
The dismal state of consumer confidence suggests that the recession is decidedly not over, regardless of statements to the contrary from leading economists. In a separate ABC News/Washington Post poll last week, a resounding 82 percent reported – based on their experience and despite what economists have said – the recession is not over.
Beyond broader economic concerns, a factor in the weak buying climate may be related to the recent run-up in gas prices, up 19 cents in the past two weeks. There is slightly better news on the housing front; the Case-Shiller Home Price Index released today shows seven months of slowing depreciation, but still home values are down by 30 percent from their peak in May 2006.
INDEX – The CCI is based on Americans' ratings of the buying climate, their personal finances and the national economy. As noted, ratings of the buying climate are at 21 percent positive, just 3 points from the record low last reached a year ago. They're 16 points below the long-term average and have been below 30 percent for a record 85 weeks.
Ratings of personal finances, typically the best of the CCI's three measures, are at 43 percent positive, 14 points below average and below a majority for 24 weeks straight and all but two weeks this year.
Positive ratings of the national economy, at 10 percent, have been in double digits for six consecutive weeks – the best such run in a year. But at a whopping 28 points below average, they're in terrible shape.
TREND – At -51 this week, the index is at its lowest point since July 12 and stands only 3 points from the record low, -54 on Jan. 25. It's slipped 6 points since the beginning of the month, the second steepest such drop this year.
The index's been below -40 for a record 79 consecutive weeks, and hasn't seen positive territory since March 2007. Its average for the year so far is -48, 36 points below its long-term average and 4 points below the worst annual average on record, -44 in 1992. It's miles from its best annual average, +29 in 2000, and all-time best, +38 in January 2000.
GROUPS – The index is higher as usual among better-off Americans, but has been negative across the board for 35 weeks straight, the longest such run in data since 1990.
It's -18 among those with the highest incomes but -80 among those with the lowest, -39 among people who've attended college vs. -80 among high school dropouts (2 points from last week's low), -42 among men while -57 among women (the worst since July), -45 among homeowners (the worst since August) compared with -61 among renters, and -50 among whites (2 points from the low) vs. -59 among blacks. The last is far different from the usual 28-point racial gap.
Partisan differences remain, with the CCI at -35 among Republicans, compared with -51 among Democrats and -55 among independents. But the Republican-Democratic gap has been narrower than usual this year, averaging 20 points compared with 41 points last year and 32 points long-term.
Here's a closer look at the three components of the ABC News CCI:
NATIONAL ECONOMY – Ten percent of Americans rate the economy as excellent or good; it was 11 percent last week. The highest was 80 percent Jan. 16, 2000. The worst was 4 percent Feb. 8, 2009.
PERSONAL FINANCES – Forty-three percent say their own finances are excellent or good; it was 41 percent last week. The best was 70 percent, last reached in January 2000. The worst was 39 percent June 28 and 21, 2009.
BUYING CLIMATE – Twenty-one percent say it's an excellent or good time to buy things; it was 23 percent last week. The best was 57 percent on Jan. 16, 2000. The worst was 18 percent, last reached Oct. 19, 2008.
METHODOLOGY – Interviews for the ABC News Consumer Comfort Index are reported in a four-week rolling average. This week's results are based on telephone interviews among a random national sample of 1,000 adults in the four weeks ending Oct. 25, 2009. The results have a 3-point error margin. Field work by ICR-International Communications Research of Media, Pa.
The index is derived by subtracting the negative response to each index question from the positive response to that question. The three resulting numbers are added and divided by three. The index can range from +100 (everyone positive on all three measures) to -100 (all negative on all three measures). The survey began in December 1985.
ERRATA – A software problem at ICR created errors in crosstabulated results by income group and marital status in data Aug. 30 to Oct. 18. The CCI overall and in other crosstabulations was not affected. See updated reports at http://abcnews.go.com/pollingunit/cci or contact the ABC News Polling Unit for corrected results by income group and marital status.