U.S. consumer confidence has just been reported as having risen in October to its highest level since early 2008.
What is wrong with this picture in the face of current levels of U.S.:
residential housing prices, which on average are reported to have dropped by about 9% on an inflation-adjusted basis from March 2008 levels;
average hourly wage rates that are reported to have been rising since March 2008 at a rate about equal to the reported inflation rate; and,
continuing high unemployment rates, which official reported unemployment rate has increased by about 55% since March 2008, and where the 'unofficial' unemployment rate likely has increased much more than that if those people who have abandoned jobs searches are taken into account?
See approximate comparator numbers in the following table.
|March 2008||Sept/Oct 2012|
|U.S. Housing Prices (inflation-adjusted)||$185,000||$165,000|
|Average Hourly Wage Rate||$21.42||$23.58|
I continue to think I have to be missing something, as I can't square increasing U.S. consumer confidence with the facts that U.S. consumers must deal with each day. I can only assume readers of this Newsletter are in the same quandary, as no one responded to my request to 'tell me what I am missing' when I requested them to do that a few days ago.
Topical References: Consumer Confidence Rises to Highest Level Since February 2008, from Real Time Economics, Kathleen Madigan, November 1, 2012 - reading time 1 minute. Also see US consumer confidence jumps to near five-year high, from BBC Business News, November 1, 2012 - reading time 3 minutes.