CONSUMERS FEEL GOOD ABOUT THE ECONOMY SATURDAY, APRIL 9, 2005 BY: JEANNINE AVERSA AP ECONOMICS WRITER

INTRODUCTION…  CONSUMER CONFIDENCE HELD FAIRLY STEADY OVER THE PAST MONTHS DESPITE SURGING ENERGY PRICES AND MORE CAUTIOUS HIRING BY AMERICA’S EMPLOYERS.

ACCORDING TO AP-IPSOS CONSUMER CONFIDENCE INDEX CLOCKED IN AT THESE RESULTS… READING IN MARCH 84.2 READING IN MARCH 84.2 READING IN APRIL 84.5 READING IN APRIL 84.5 ONE YEAR AGO 84.8 ONE YEAR AGO 84.8

APRIL’S READING SUGGESTS.. CONSUMERS STILL FEEL PRETTY GOOD ABOUT THE ECONOMY IN GENERAL EVEN AGAINST THE BACKDROP OF HIGH PRICES FOR OIL, GASOLINE AND OTHER ENERGY PRODUCTS.

WHO WATCHES CONSUMER CONFIDENCE????? CONSUMER CONFIDENCE IS CLOSELY WATCHED BY ECONOMISTS FOR POSSIBLE SIGNS ABOUT PEOPLE’S BUYING HABITS. CONSUMER SPENDING ACCOUNTS FOR ROUGHLY 2/3 OF ALL ECONOMIC ACTIVITY IN THE UNITED STATES.

UPCOMING MONTHS ECONOMISTS WILL BE LOOKING FOR SIGNS IN COMING MONTHS AS TO HOW MUCH CONSUMERS MIGHT BE TIGHTENING THEIR BELTS IN RESPONSE TO THE HIGH ENERGY PRICES.

FOR EXAMPLE… AT THE PUMP GAS PRICES, NOW AVERAGE $2.22 PER GALLON NATIONWIDE, WOULD PEAK AT ABOUT $2.35 A GALLON THIS SUMMER, ACCORDING TO AN ESTIMATE MADE BY THE ENERGY INFORMATION ADMINISTRATION.

(FEDERAL RESERVE CHAIRMAN) ALAN GREENSPAN HAD THIS TO SAY… TIGHT ENERGY SUPPLIES AND STRONG DEMAND HAVE CREATED THE CURRENT PRICE FRENZY. P** s´s´

“MORE CAUTIOUS HIRING BY AMERICA’S EMPLOYERS… LAST FRIDAY, THE GOVERNMENT REPORTED THAT AMERICA’S EMPLOYERS, HIT BY ENERGY BILLS, ADDED JUST 110,000 JOBS IN MARCH, THE FEWEST IN EIGHT MONTHS. IT WAS LESS THAN ½ OF THE 243,000 NEW JOBS GENERATED IN FEBRUARY. THIS REPORT (WHICH DISAPPOINTED ECONOMISTS) UNDERSCORED THE BUMPY RECOVERY TAKING PLACE IN THE LABOR MARKET.

DISCLAIMER APRIL’S CONSUMER CONFIDENCE INDEX WAS BASED ON RESULTS OF A SURVEY OF ADULTS ABOUT THEIR ATTITUDES ON PERSONAL FINANCES AND THE ECONOMY. RESULTS OF THAT SURVEY HAD A MARGIN OF ERROR OF + OR – 3 PERCENTAGE POINTS

CREDITS… Consumers feel pretty good about the economy - 04/09/05Consumers feel pretty good about the economy - 04/09/05 Detroit News Kara Raper (extra credit)