Today's little ray of sunshine...

Actually, this could be titled "The Economy turns to the darkside", or so it seems right now! Today's consumer confidence numbers dropped almost 10 points--the first drop since our last 10 point drop (February 2010-the index had risen monthly since that month's report). There are two components to the Consumer Confidence Index-one that measures how consumers feel about the economy (now) and the other assesses their outlook over the next six months. As noted previously, it's all about JOBS. Not the health care debate (debacle?). Stocks even dipped below 10,000 today (around 2pm the Dow is still around 9900 (will the Dow even close above that this week?). To put numbers into perspective, this index hit an all-time low of 25.3 in February 2009. Above 90 = solid economy, over 100 = strong growth. Todays' number? 52.9 (down from May's 62.7, with the expectation today's numbers would be 62.8).

What else is a mess? Housing. Sales of new homes fell 33% in May, to the lowest level ON RECORD after the government tax credits expired (and to be honest, April's closings/contracts were not as amazing as we had hoped). What other fun statistics do I have for you? Auto sales are expected to slow for June (have you seen more 0% finance deals advertised? Yep, I thought so too). Companies tracking auto sales expect a 9-12% drop for June sales, so you can expect to have more TV ads screaming at you between your reality programs (is there anything else on TV?). A quote from George Pipas (Ford's top sales analyst) notes that "The two big issues with consumers right now are employment growth and income growth, and they're not seeing much of either." Well stated...

So again, consumer confidence is in the toilet, sales of new and previously owned homes fell last month, auto sales are down, stocks are down (but hey, Bond sales are up!) and it is expected that the unemployment rate will creep up to 9.8% from 9.7% when numbers are reported this Friday. The only positive things to report relate to home prices rising in April (again, most likely due to the tax credit push) and consumer spending (remember, that's 70% of our Economy) rose 0.2% last month with personal income rising 0.4% (so more saving, less spending).

Finally--what other 'big picture' items could dump us into a DD? (no, not Pamela Anderson, that would be a "Double Dip" as in recession) Unfortunately, there are several disturbances in 'the Force' that are still unsettled. Globally, Asian markets fell after indexes related to China's economic activity fell and European indexes fell sharply after Greek workers walked off the job to protest budget cuts (how's that Socialist thing working out for you?). So roll that into our own government budget cuts, end of fiscal stimulus programs, problems in Europe and a slowdown in China--could that force a double dip recession? Time will tell. But for the United States, 2 comments attributed to a broker in NY (Doreen Mogavero) ring true: "People are starting to see that this recovery, as it is, is going to take considerably longer than anybody had anticipated." Relating to jobs and the job report, "That is the core of the recovery here. People have to feel they're going to work. If they don't they're not going to spend money." Again, well stated. So how confident are you? I'm not feeling it today... Ask me tomorrow or something...

Quote of the Week!

While I am not fully 'educated' on whether or not I like or dislike Treasury Secretary Tim Geithner (I definitely hate the fact that big O couldn't find someone who didn't owe back taxes for the post, however) I must admit that I LOVED the following interchange reported by the Wall Street Journal last Friday (from the Joint Economic Committee):

REP. KEVIN BRADY (R-TX) "The public has lost all confidence in your ability to do the job."

TREAS. SEC. GEITHNER: "What I can't take responsibility is for the legacy of crises you've bequeathed this country."

BO WAGNER: "DUH!"

I concur Mr. Geithner, you hit the nail on the head (and nailed Mr. Brady in the process). I guess I'll go harsh this morning: I condemn Congress. I blame Congress. I am unhappy with Congress. For too long we have had these people running our country into the ground. BOTH parties. It's time for this mess to stop. It's time for TERM LIMITS. Elect representatives based on what messages they 'sell' us during elections (e.g. do we agree with their point of view? Then send them to DC for a short time to accomplish that goal and can them if they don't do what they promised). House of Representatives? 3 terms (that's six years). Senate? 2 terms (twelve years). I am unsure how I'd feel about a Representative 'graduating up' to the Senate (giving them a potential 18 year 'reign' on our nickel). I just can't see any other options to get these people to do what we want them to do--so that our "government of the people, by the people, for the people shall not perish from the earth."

We are at a true crossroads in our country. I have made my own choices in my life and I have benefited or been 'punished' for them. It is not the role of the government to step in and save me (or further punish me) for my choices. You cannot legislate change; there is no moral obligation (or requirement) for the government to take money from me and give it to someone else. I have my own issues and 'causes' to handle--it's not my job to be someone else's guardian--except for my wife, kids, dogs and family. My choices. Again, read John Galt's speech from Atlas Shrugged and you'll understand (for a highly condensed version, click here).

Lest you think I am a complete selfish monster, I do want to point out that I am a charitable person--however, I give to what I support-not what the government 'thinks' I should support. My 2 cents as always... Happy Monday, eh? : )

(For one important group I support, check out The Rotary Foundation and consider supporting them...)