It was disappointing to see the Conference Board's report on April 25 suggesting consumer confidence had increased in April. Gallup's most recent weekly Economic Confidence measure shows the reality is just the opposite.
The Wells Fargo/Gallup Small Business Index shows small business owner optimism also declined in April.
This is a critical moment for the U.S. economy and not a time to be misled by an outdated report claiming consumer confidence is increasing. Surging gas and food prices have combined with political battles over fiscal policy to drive consumer optimism down so that it is far below where it was a year ago.
Odds are that Bernanke will try to say as little as possible about monetary policy in his press conference Wednesday hoping to keep Wall Street from succumbing to the growing pessimism on Main Street. What Bernanke really needs to do is find a way reassure Americans that monetary policy will be responsible whether the politicians can find their way to a fiscal compromise or not. This will be tricky given quantitative easing, a fragile economy, and the possibility of stagflation. But reassuring Wall Street is not enough for Bernanke to succeed before the press on Wednesday -- reassuring Main Street is the real challenge. Labels: Bernanke, consumer confidence, economic confidence small business owner confidence, main street, wall street, Wells Fargo-Gallup Small Business Index