Americans' consumer confidence apparently (and unexpectedly) tumbled in December (104.7 from 112.8 prior vs 113.2 exp), driven largely by a plunge in expectations (which dropped from93.7 to 81.1)...
Source: Bloomberg
“The recent rebound in consumer confidence was not sustained in December as the index dropped back to the middle of the range that has prevailed over the past two years,” Dana Peterson, chief economist at the Conference Board, said in a statement.
And if that is a little confusing given the surge in confidence we have seen among small business, large business, and various other sentiment indicators (like UMich), the explanation is simple....
It's not the economy, it's partisan ideologues, stupid!
In write-in responses to the survey, consumers increasingly cited politics and tariffs. A special question showed that 46% of respondents expected tariffs to raise the cost of living, while 21% expected tariffs to create more US jobs.
While we saw the party-denominated confidence from Umich show Dems plunged as Republicans soared, The Conference Board does not break the survey down that way... but we can get a glimpse...
New England and Mountain regions saw confidence collapse while the middle of the country saw confidence surge...
Source: Bloomberg
And drilling down further - Dem-dominant states like NY and CA saw consumer expectations plunge while Republican-heavy states like Texas saw expectations soar... and so did Pennsylvania...
Source: Bloomberg
On the bright side, the labor market showed signs of improvement in December...
Source: Bloomberg
So is the economy going to do great (like Texans think) or will it crash and burn in hell (like Californians think)?
