It’ll be a week until we get another read on retail sales and it’s important to remember that, oftentimes, Americans do and say two very different things when it comes to consumer spending and consumer confidence, but the latest Gallup polling data on the latter is worthy of note.
As you may have already observed, the most recent -22 reading is the same level that was reached at year-end, just as the fiscal cliff deal was coming together. Of course, the big difference between the fiscal cliff and the sequestration budget cuts is that, ultimately, the fiscal cliff was averted with the only adverse impact to most Americans being a payroll tax hike that, as shown above, was quickly shrugged off.
This time around, most of the plunge in confidence came after the sequestration cuts went into effect last week and, despite ongoing talks in Washington, they are likely here to stay.