Surprise, surprise, consumer sentiment in America reached its post-recession high in November, just as politicians were sending Americans to bed each night with dreams of jobs and prosperity on the horizon. Meanwhile, Americans supporting incumbents in 2012 told themselves everything was OK to justify voting for their candidates. That false positive sentiment bled through to surveys as expressed deluded hope.
Now that those heady days are over, sentiment is based deeper in the reality that taxes have gone up on 77% of Americans, job growth remains anemic, gas prices remain elevated, and dollars are losing a little bit of their value every day. Unemployment is still 7.8%. The people running the federal government still can’t agree on anything. And the states that were out of money before the election are still out of money today. Not much cause for optimism.
Take a look at the University of Michigan’s Consumer Sentiment chart below. Americans’ mood is worse than at any point during 2012. The trend does not appear to be heading north. But everything’s OK because the stock market is booming, right? It’s hard to imagine what is causing the commotion on Wall Street. Sentiment today is worse than it was right after 9/11. Where’s the cause for optimism in that?