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Tuesday, August 31, 2010

Consumer Confidence Report Out of Date

Tuesday morning's Conference Board report showing that consumer confidence increased slightly more than generally expected in August gave a temporary boost to the stock market. Of course, this modest upturn in the consumer confidence was predicted by Gallup's Economic Confidence Index.

More importantly, this market moving report is already out of date. New Gallup Daily tracking results show consumers becoming increasingly negative on the economy during recent weeks -- 63% said the economy is "getting worse" in the week that ended Aug. 29 -- essentially matching the highest level (64%) of the year.

Even more troubling is the fact that Americans are more pessimistic about the current outlook for the U.S. economy now than they were a year ago. And, not surprisingly, they are pulling back on spending once more. Neither are good news for incumbents looking to the midterm elections.

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