Confidence in a Record Slump

Dec. 9, 2008 — -- The weekly ABC News Consumer Comfort Index entered its 23rd year this week with consumer confidence mired at historic lows.

The CCI stands at -52 on its scale of +100 to -100, at or below -50 for an unprecedented fifth week straight. It's been this low only 10 times in almost 1,200 weekly polls – nine of them this year, and eight of them since August. Its new record low was -54 last week.

All three components of the index are hurting: Ninety-two percent of Americans say the national economy's in bad shape, 79 percent rate the buying climate negatively and 57 percent say their own finances aren't good.

The reasons are plentiful: Unemployment, at 6.7 percent, is its highest since October 1993; and the nation's employers cut more than half a million jobs in November, the most in 34 years. The country's been officially in a recession since December 2007, in which time the CCI has fallen from -17 to today's -52.

It's fallen even further since its recent high, +2 in March 2007, a breathtaking dive.

INDEX – Ratings of personal finances, traditionally the index's strongest component, are only 43 percent positive, a point off the record low set in March 1993 and matched last week. Fewer than half have rated their finances positively since mid-July, the longest such streak since late 1992 and 1993.

Many fewer, 21 percent, say it's a good time to buy things, a chilling result for holiday retailers. Positive ratings of the buying climate are just 3 points from their record low in August and October, down 10 points this year and 17 points off the long-term average.

The fewest still, 8 percent, rate the national economy positively, 1 point off the record low tied last week. Positive ratings of the economy are down 23 points this year and 31 points off the long-term average.

TREND – Beginning the year at -20, the CCI headed down swiftly, hitting a then-record low -51 in late May. It recovered to a still-grim -41 in July and September, but then dropped again, to new records of -52 in mid-November and -54 last week.