From the course: Economic Indicators

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Consumer confidence

Consumer confidence

From the course: Economic Indicators

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Consumer confidence

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- About 70% of the U.S. economy is driven by personal consumption, the stuff that regular people like you and I buy, clothes, cars, and food. And of course, we're not going on too many shopping sprees if we don't feel very confident about the economy. In fact, if I'm nervous about the economy, I tend to buy fewer things. I may postpone buying a new car or sofa. And I might even start buying cheaper wine to bring to friends' birthday parties. The truth is that if people are confident about the economy, they will spend money. And if they aren't, they won't. This is why the monthly Consumer Confidence Index from The Conference Board is an important economic indicator. It shows how confident American consumers are. And that implication of confidence means a lot for financial markets. Strong confidence numbers are good for most stock prices, but weak confidence numbers are bad for the economy and equity markets. The Nielsen Company has been operating the survey for The Conference Board as…

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