Consumer confidence fell in October as inflation takes a toll
Source: CNN Business
Consumer confidence fell in October as inflation takes a toll
By Alicia Wallace, CNN Business
Published 10:14 AM EDT, Tue October 25, 2022
Minneapolis (CNN Business) — US consumer confidence fell in October to the lowest level since July as high borrowing costs and soaring inflation take their toll on household budgets.
The consumer confidence index slumped to 102.5 from a revised 107.8 in September, according to data released Tuesday by the Conference Board. Economists were expecting a reading of 106.5, per estimates from Refinitiv. A reading above 100 signals consumers have an optimistic attitude toward the economy. In February 2020, the consumer confidence index was 132.6.
Consumer spending, which drives the US economy, has remained strong since the start of the Covid-19 pandemic, with high levels of goods purchasing during lockdowns, followed by robust spending on travel and dining out once restrictions were lifted.
However, a global imbalance of supply and demand led to the current bout of decades-high inflation in the United States, which the Federal Reserve is trying to bring down through a series of jumbo-sized rate hikes. That has, in turn, pushed up borrowing costs, adding to higher overall expense for consumers, some of whom have begun to rein in their spending.
This story is developing and will be updated.
Read more: https://www.cnn.com/2022/10/25/economy/consumer-confidence-index-october/index.html
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There are a whole different set of circumstances going on here that make it different from the '70s - '80s.
Reposting this chart back over the summer - https://www.democraticunderground.com/?com=view_post&forum=1002&pid=16980296
Shows the daily level of the federal funds rate back to 1954. The fed funds rate is the interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight, on an uncollateralized basis. The Federal Open Market Committee (FOMC) meets eight times a year to determine the federal funds target rate. The current federal funds rate as of July 27, 2022 is 1.58%.
https://www.macrotrends.net/2015/fed-funds-rate-historical-chart
are being done to "cool the economy" on purpose. That has nothing to do with the underlying situation that was caused by a pandemic shock which is not the same as what happened 45 years ago.
Leading up to this situation after the market crash of 2007, the Fed took the interest rates down to near 0% and kept it there until just before the pandemic hit (there were several increases in 2018 and 2019), and then they promptly dropped it back down again as the COVID shock hit. So you're talking almost a decade of artificially low rates to recover from a previous economic calamity and then they got hit with another.
In the late '70s/early '80s, the UE rate was well over 10% where now it is ~3.5%. And the value of the dollar is also stronger now (vs other global currencies) than in the late '70s.
IOW, they really don't know how to model this situation.
and now I have started hearing all the gold hucksters back on the radio again! 
my mother had called me (I was in college at the time) and told me that earlier that day, she and my younger sisters were in line at some jeweler cashing in the old 14kt thin gold chains, sterling bracelets, and (hollow) candlestick holders. Meanwhile I had some college friends staring lovingly at the Goldschläger. 
