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RE: TIB: Today I Bought (and Sold) - An Investors Journal #317 - Europe Airline, US Retail, US Health Insurance, Japan Interest Rates
I think the weakness in the US housing sector continues to signal a more hesitant consumer going into the holidays. I have a feeling it will be weaker than expected because of it. However, consumer confidence does not point the same direction.
Housing is responding to interest rates rather than consumer or business confidence. The surveys of consumer and business confidence that I rely on from Changewave Research are pointing to highest levels of confidence since 2008 - i.e., before the crash. That confidence will play through to this holiday season. Re will be one more survey before the end of the year.
As I look at retail performance over the last 3 months, I am comfortable with the survey findings. Black Friday sales numbers will give us the next data point to test it out some more.
Interesting thoughts but I think it is a balance between interest rates and confidence. Many that have the ability to buy home are probably hesitant remembering the crisis while probably still thinking that rates are still at below average long term values.
There is no doubt that 2009 plays havoc with people's risk perceptions and is a core part of the housing problem now as rates rise. Consumer confidence is playing through in other areas of spending - watch Black Friday carefully.