Survey: Consumer confidence remains low in Fla.
Published: Wednesday, October 1, 2008 at 6:01 a.m.
Last Modified: Tuesday, September 30, 2008 at 10:47 p.m.
Consumer confidence was up in Florida and the U.S. in September, but the mood toward spending is still low and may have sunk further after the financial news of the past week — after the surveys were taken.
Florida’s confidence rose 3 points to 70 for the third monthly increase since an all-time low of 59 in June, according to a University of Florida study.
The index was even higher mid-month, but dropped over the next two weeks after problems with AIG, Lehman Brothers’ bankruptcy and the proposed $700 billion bailout, according to Chris McCarty, director of UF’s Survey Research Center at the Bureau of Economic and Business Research.
Still, the rate of the last two weeks was even with August’s rate of 67.
The survey was completed before Monday’s 7 percent stock market decline after Congress voted down the bailout, although McCarty said he is not sure that would cause the bottom to fall out of confidence since the market has already experienced wild volatility and is nowhere near the 20 percent drop in 1987.
Lynn Franco of The Conference Board Consumer Research Center said market shocks usually cause a temporary loss of confidence lasting two to four months unless they result in significant job losses, The Associated Press reported.
The center’s index showed U.S. consumer confidence up to 59.8 in September from a revised 58.5 in August — but the index is about half of what it was a year ago.
In recent months the index has been hovering just above a low of 54.6 in October 1992 when the economy was coming out of a recession.
Declining home prices, foreclosures, unemployment and rising fuel and food prices are weighing on consumers’ minds.
McCarty noted that in Florida, housing prices are down 28 percent from a June 2006 peak, unemployment is up to 6.5 percent, tourism is down and retail sales have been down considerably over the last two years based on the state’s sales tax revenue.
Of five components in Florida’s survey, the biggest rise was in perceptions of whether it is a good time to buy big-ticket items, up 10 points to 67.
Expectations about personal finances a year from now and perceptions of U.S. economic conditions over the next year were also up.
Perceptions of personal finances now compared to a year ago and perceptions of U.S. economic conditions over the next five years remained unchanged.
The indexes measure changes in confidence over time from a starting point of 100.
Anthony Clark can be reached at email@example.com or 352-374-5094.
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