Feb. 24, 2009 -- Consumer confidence inched – barely – to its best of the year this week, boosted by improved ratings of personal finances. But it's by no means out of troubled territory.
The ABC News Consumer Comfort Index stands at -48 on its scale of +100 to -100, up 5 points in two weeks, moving slowly off the mat since hitting its record low, -54, Jan. 25. Although still mired near its worst, the CCI's gain is its biggest since September, lifting it to its best in two months.
The boost is fueled primarily by slightly better views of personal finances: Forty-nine percent say theirs are in good shape, up 5 points in two weeks – matching their largest two-week increase since December 2007. Nonetheless, majorities have rated their own finances negatively for 31 weeks straight, surpassed only by a 40-week run in 1992-93.
The slight reprieve comes as Barack Obama addresses a joint session of Congress tonight to detail his economic plans and seek to reassure the public on the country's future.
There's been little in the way of good economic news for months. Fed Chairman Ben Bernanke today reported "severe contraction" in the nation's economy, attributed largely to the housing market's collapse. The Case-Shiller Home Price Index for 2008, reported today, shows a record 18.2 percent decline in home prices nationally.
And in a separate ABC News/Washington Post poll released yesterday, 56 percent said the economy is in a serious long-term decline, rather than a normal cyclical downturn.
INDEX – The 49 percent who rate their personal finances positively is the most since late October – up 8 points since bottoming out at 41 percent Jan. 25 (the best such gain since September 2007). Despite the improvement, positive ratings of personal finances are still 8 points off their long-term average in weekly polls since late 1985.
For the second straight week, only 5 percent rate the economy positively – a point off the record low set two weeks ago, 34 points below the long-term average and 10 points off last year's average, itself the second lowest annual mark on record.
The economy has been positively rated by 5 percent or fewer for the last six weeks and by fewer than one in 10 for 16 weeks, the worst such streaks on record.
Twenty-four percent rate the buying climate positively, 14 points from the long-term average and just 6 points off the low set in October and August. Fewer than a third of Americans have said it's a good time to buy things for 67 weeks straight now, second only to a stretch from 1990-93.
TREND – After gaining 5 points over the past two weeks, confidence, as noted, is at its 2009 high and its best in two months. It's better than -50 for the second straight week, a sight unseen since the start of the year.
But 2009, like 2008 before it, has been dreadful for consumer confidence. The index's average for the year so far is -51, 40 points below its long-term average of -11 and 9 points below its 2008 average. It's light years below its record high, +38 in January 2000.
The index, at least, has been highly consistent: It's lingered between -48 and -54 for 20 weeks straight since mid-October, the longest such slump on record. It's been below -40 for 44 consecutive weeks, another record.
GROUPS – The CCI is higher as usual among better-off groups, but still negative for most Americans. For the second straight week, the highest income bracket is the only group in positive territory – and just barely, at +1, vs. -70 among those with the lowest incomes.
It's -41 among those who've attended college vs. -60 among high school dropouts (their best in two months), -43 among men (their highest since the beginning of the year) while -53 among women, -44 among homeowners vs. -58 among renters (their best since early October) and -47 among whites vs. -57 among blacks (their highest in two months).
Sharp partisan differences remain: The index is -31 among Republicans vs. -59 among Democrats and -47 among independents (the latter, their best since the start of the year).
Here's a closer look at the three components of the ABC News CCI:
NATIONAL ECONOMY – Five percent of Americans rate the economy as excellent or good, the same as last week. The highest was 80 percent Jan. 16, 2000. The worst was 4 percent Jan. 8.
PERSONAL FINANCES – Forty-nine percent say their own finances are excellent or good; it was 47 percent last week. The best was 70 percent, last reached in January 2000. The worst was 41 percent Jan. 25.
BUYING CLIMATE – Twenty-four percent say it's an excellent or good time to buy things, the same as last week. The best was 57 percent on Jan. 16, 2000. The worst was 18 percent Oct. 19, Aug. 10 and Aug. 24, 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 Feb. 22, 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.