US consumer sentiment dips despite jobs - survey

Reuters, 04.06.04, 10:00 AM ET


NEW YORK, April 6 (Reuters) - Confidence in the U.S. economy slipped again in April, surprising analysts who had thought a strong March jobs report would lighten the mood among consumers, a survey showed on Tuesday.

Investor's Business Daily and TechnoMetrica Market Intelligence said their economic optimism index fell to 52.8 in April from 54.5 in March, the third straight drop and a long way from the 22-month peak of 60.6 hit in January. A reading above 50 indicates optimism.

The gauge is based on over 900 interviews and predicts with 90 percent reliability the widely watched University of Michigan and Conference Board consumer sentiment surveys

Link to Reuters Article

buying into the latest jobs report as they aren't seeing evidence on Main Street.

Anyway, here's the article that suggests a bit of WH cheerleading going on.

'Background' Moves to Forefront

http://www.washingtonpost.com/wp-dyn/articles/A52988-2004Apr5.html

workers. Those were not new jobs.

information coming out of reporting depts of the government like no other administration has done. I wouldn't put it pass them to report anything as a new job.

I had this number wrong last week (I could have sworn it was higher) but here is the only citing of it I could find.

http://news.yahoo.com/news?tmpl=story&u=/bw/20040405/bs_bw/nf20040425933

The service-sector jobs gain was the largest since May, 2000, with retail up 47,000 (some apparently from the return of California grocery workers after their recent strike), and trade/transport/utilities overall up 73,000.

every branch of Bush's govt. skews the numbers, the truth -

308,000 puhleease

Since the gap between the haves and the have nots has widened and the middle class is shrinking, I think the numbers reported for the good economy are for the economy that the haves operate in. The one the have nots operate in is not so good.

This is from a newsletter by Chuck Butler from www.everbank.com. I have found him to be right on with most of what's going on.

My friend and well
respected analyst, John Mauldin sent me a report yesterday that the
markets obviously didn't have privy to when they sent the dollar soaring
on Friday... Here's the skinny...

Lacy Hunt of the King Report broke down the labor data and here's what
he found... This also answers many questions I received yesterday about
how could we gain 308k jobs and the unemployment rate rise? Well, here
goes...

" Of the 308k jobs created, 296k are temporary or part-time jobs! (95%!)
Let us repeat and let's be very clear, almost all jobs created in what
is heralded as a great employment report are part-time jobs. "In March,
the number of persons who worked part time for economic reasons
increased to 4.7 million, about the same level as in January. These
individuals indicated that they would like to work full time but were
working part time because their hours had been cut back or because they
were unable to find full-time jobs. (See table A-5.)" People want
full-time but can't find it. Lacy opines that Congress did not renew
unemployment benefits so many people took whatever they could get. This
accounts for the surge in people entering the workforce."

First, the high in January wasn't really a high of 22 months. It was within the 95% confidence interval for the standard January, which is normally a bit higher. The thought is that it's caused by holiday fever and the modest optimism a new year brings. So, every January is a little higher than most months, especially in down times, and this wasn't really a 22 month high.

For this reason, expecting March to be good because of January is just stupid and shows that most of the econometric analysts couldn't find their faces with their hands.

Secondly, jobs are not an indicator of things. Employment saturation is an independent variable that forward leverages economic growth, but is not a trigger to consumer confidence. It's autocorrelated to those with good jobs. So, the number doesn't change due to a minor blip in the employment picture.

There isn't one shred of data to support these expectations which further reinforces my belief that a large portion of the economics community is bought and paid for. They come with results their masters want to hear, not those supported by a sound analysis of the macroeconomy.
The Professor