Thursday, December 29, 2011

Analyst: Consumers feeling better about the recovery

The economic recovery is taking longer than many hoped, but one measure - consumers' financial anxiety - seems to be improving, analyst Dan Geller reports.

His Money Anxiety Index, which measures how economic indicators are affecting consumer behavior, began to decline in July after rising steadily through the recession and recovery. The index hit 95.1 in December, down from 99.5 earlier this year, said Geller, executive vice president of Market Rates Insight, a California research firm that analyzes bank pricing.

The improvement is due in part to the falling national unemployment rate and has translated to higher retail sales in recent months, he said. Still, despite the declining anxiety, the index remains at the same level as during the recession of the early 1980s, Geller said.

"The current level of consumer financial anxiety is still very high," he said.

The Money Anxiety Index measures consumers' financial worries based on economic indicators, rather than how they say they feel about the economy. It has fluctuated from a high of 136 in the 1980s to a low of 40.3 in the mid-1960s.


Anonymous said...

Looks like his index takes into account the unemployment rate without factoring in the number of people who have given up looking for work.

Otherwise, he'd discover that the latter is the reason for the decline in the former. Oops. Sorry to burst the prObama propaganda bubble, guys.