The dog is finally wagging its tail; but the often scrappy dog may just be happy because it keeps being thrown bones.
The Economic Optimism Index was up 1.1 points for October, a gain of 2.4% from September readings. The Index, which is produced each month by Investor's Business Daily and TechnoMetrica Market Intelligence said their IBD/TIPP Economic Optimism Index climbed to 46.4 in October from 45.3 in September. Readings above 50 indicate optimism, while those below 50 point to pessimism. The October index reading is still far into pessimistic territory and below its 12-month average, but its overall gain is a step in the right direction.
Additionally, the IBD/TIPP Economic Optimism Index has a good record of foreshadowing the consumer confidence numbers that are released later in the month by the University of Michigan and The Conference Board, which means the public should continue to hear good news about consumers in the weeks ahead.
Yet the truth is that the statistics point in virtually every direction right now, but a closer look can also reveal why perhaps we shouldn't be too overzealous.
The IBD survey showed that consumers have confidence in their own personal finance outlook and that their six-month economic outlook has improved dramatically and almost gotten into positive territory, but that confidence in federal economic policies is virtually non-existent. With mid-term elections more than likely set to make changes in Congress, it’s hard to see that last number sprinting into positive territory in the immediate future.
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