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The lead indicators of the San Diego economy, compiled by economist Alan Gin of the University of San Diego, rose in June for the fourth straight month, according to data released this morning (July 28). The index was 101.6 in June, up from 101.2 in May, 100.9 in April, and 100.7 in March. But now the questionable news: Previous months have been revised upward. February is now 102.9, January 105.7 and December of last year 108.2. Unless the recent months are later revised upward, the trend does not look as promising.
On the national level, consumer confidence continues to look grim. The Conference Board reported this morning that its consumer confidence index dropped to 46.6 in July from 49.3 in June and 54.8 in May. July was worse than economists had expected. Earlier, the Reuters-University of Michigan consumer confidence poll had dropped in July to 66 from June's 70.8. High unemployment and underemployment above 16% are hitting consumers.
Forecasters in San Diego and the nation must wake up: the consumer is 70% of the economy, and is saving, not spending. There are no signs of a consumer pickup, and frankly, the economy is better off long term (not short term) if the consumer continues to save. Wall Street and the federal government are trying to talk the economy up by spinning the news and using tricks to manipulate statistics, such as the unemployment numbers. Commercial real estate is in a downspin, residential real estate may be stabilizing at an extremely low level, and we have given away our manufacturing base to jack up short term profits over the last two decades.
In San Diego, the parts of the lead indicators that rose were building permits, stock prices, consumer confidence and the national economy. Building permits and stock prices are improving because of the massive amount of liquidity the Federal Reserve and Treasury have pumped into the economy. Consumer confidence probably will not hold up. The indicators declining are those related to employment: initial unemployment claims and help wanted ads.
The lead indicators of the San Diego economy, compiled by economist Alan Gin of the University of San Diego, rose in June for the fourth straight month, according to data released this morning (July 28). The index was 101.6 in June, up from 101.2 in May, 100.9 in April, and 100.7 in March. But now the questionable news: Previous months have been revised upward. February is now 102.9, January 105.7 and December of last year 108.2. Unless the recent months are later revised upward, the trend does not look as promising.
On the national level, consumer confidence continues to look grim. The Conference Board reported this morning that its consumer confidence index dropped to 46.6 in July from 49.3 in June and 54.8 in May. July was worse than economists had expected. Earlier, the Reuters-University of Michigan consumer confidence poll had dropped in July to 66 from June's 70.8. High unemployment and underemployment above 16% are hitting consumers.
Forecasters in San Diego and the nation must wake up: the consumer is 70% of the economy, and is saving, not spending. There are no signs of a consumer pickup, and frankly, the economy is better off long term (not short term) if the consumer continues to save. Wall Street and the federal government are trying to talk the economy up by spinning the news and using tricks to manipulate statistics, such as the unemployment numbers. Commercial real estate is in a downspin, residential real estate may be stabilizing at an extremely low level, and we have given away our manufacturing base to jack up short term profits over the last two decades.
In San Diego, the parts of the lead indicators that rose were building permits, stock prices, consumer confidence and the national economy. Building permits and stock prices are improving because of the massive amount of liquidity the Federal Reserve and Treasury have pumped into the economy. Consumer confidence probably will not hold up. The indicators declining are those related to employment: initial unemployment claims and help wanted ads.