The Marco Moment: Univ. Of Mich Consumer Sentiment And Why It Is Important
We got the latest UoM Consumer Sentiment Report and it is not good. We are seeing a continuing decline in confidence, meaning tighter economic conditions are ahead of us.
In this video I discuss why this is such an important forward looking indicator and why what we are seeing spells trouble for 2022.
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2022 and the next years will be more difficult than the first year of the pandemic.
I think we are destined for a double-dip recession. It is unavoidable in my opinion. Too many moving parts not looking very good.
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I did not know about the UoM sentiment report. I will take a look. It makes sense to put our focus on consumers as we are a consumer based economy as you said in the video. My spending habit has changed in the last two years partly due to the pandemic. I have also become more weary about my financial status. It will definitely impact the larger economy that is based on consumption.
It is a useful tool for macro analysis and what is taking place. An excellent forecasting tool upon which to build your analysis upon.
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Summary:
In this video, the speaker, Task, discusses the University of Michigan Consumer Sentiment Report and its implications on the economy. He highlights the negative conditions seen across various sectors, such as durable goods orders and automobile sales. Task emphasizes the importance of consumer sentiment in predicting economic trends and warns about the current state of the economy, suggesting that the tightening policies of the Fed may not bode well for the future.
Detailed Article:
Task begins by addressing the University of Michigan Consumer Sentiment Report and its significant impact on understanding the state of the economy. He notes that the ongoing unfavorable conditions have been observed for the past six to seven months, with data indicating a lack of positivity across the board. The recent durable goods orders were highlighted as a particularly concerning aspect, with the sentiment for buying durable goods being at historic lows, even worse than during the 2008 financial crisis.
Task delves into the automobile industry, highlighting its contraction last year despite increased production. He mentions that while supply chain issues and chip shortages play a role in the industry's challenges, there are underlying demand issues contributing to the overall situation. The consumer sentiment report is emphasized as a forward-looking indicator that provides insights into consumer behavior and economic trends.
The speaker raises concerns about consumer sentiment impacting spending habits, especially as government stimulus from the first half of 2021 has dried up. Task notes that the economy heavily relies on consumer spending, making it essential to monitor consumer sentiment closely. He discusses how inventories saw a significant increase in December, indicating an overestimation of demand that has led to excess inventory levels.
Task advises viewers to pay attention to the University of Michigan Consumer Sentiment Report due to its timely and insightful nature. He warns about the current economic conditions and expresses unease about the Federal Reserve tightening policy amidst weakening economic indicators. Task concludes by suggesting a reason for caution and implies potential challenges ahead for the economy.
In conclusion, Task's analysis of the University of Michigan Consumer Sentiment Report sheds light on the current economic landscape, emphasizing the importance of consumer behavior in shaping future trends. His detailed breakdown of various sectors and the implications of consumer sentiment provides valuable insights for viewers concerned about the state of the economy and potential challenges that lie ahead.