Pushed by soaring gasoline prices and a weakened economy, consumer confidence reached a record low this week in more than 22 years of weekly ABC News polls.
The ABC News Consumer Comfort Index stands at -51 on its scale of +100 to -100, surpassing its previous low, -50, on Feb. 9, 1992, on the heels of the 1990-91 recession. Ninety percent of Americans now rate the economy negatively, 81 percent call it a bad time to spend money and 55 percent say their own finances are hurting.
Ratings of the buying climate match their worst on record, underscoring the role of soaring gasoline prices in consumer views. Confidence has been falling since gas started climbing in January 2007; the two have correlated unusually strongly, at .79.
The long-term relationship between gasoline and the CCI has been far weaker – a non-significant correlation of .07; results over time show that gas prices impact confidence only when they're rising sharply. That's particularly so now, with gas averaging a record $3.94 per gallon nationally, and considerably higher in some locales.
Economic complaints at the time the CCI hit its last low in 1992 were far different from today's. Gas then cost $1 a gallon; in inflation-adjusted terms that would be $1.54 today. Overall inflation was lower – 2.8 percent in the first quarter of 1992, compared with 3.9 percent in Q1 this year.
There are other concerns. The Case-Shiller Home Price Index is its lowest in its 20-year history – 14.1 percent below its level a year ago, compared with 1.18 percent higher in February 1992. On the other hand, unemployment was much higher in early 1992, 7.4 percent, compared with today's 5 percent. Different times have different troubles.
INDEX – The ABC CCI is based on Americans' ratings of their current finances, the national economy and the buying climate. This week just 10 percent rate the national economy positively, down 21 points this year to its worst in 15 years and 3 points from the all-time low in late 1991 and early 1992.
Only 19 percent rate the buying climate positively, matching the record low set last week. This measure is down 12 points this year and 19 points off its long-term average.
As usual, more, 45 percent, rate their personal finances positively, but that's just 3 points from the record low, in March 1993. It's down 13 points this year and 12 points off its long-term average.
TREND – Confidence fell in each quarter last year and has steepened its dive this year, with the index losing 17 points in just the last 17 weeks. Its sustained fall has been even longer and steeper – down 53 points from March 2007 to now. In 1990 the CCI fell 29 points from June to October; in the 2000-2001 recession, 30 points from September 2000 to March 2001.
Given the sharpness of its decline, the CCI's arrival at its new low has been sudden: It's been below -40 for just five weeks straight. In February 1992 it'd been in that zone for 20 weeks.
The index is down 31 points on the year, 41 points below its long-term average and farther than ever from its record high, +38 in January 2000.