The world woke up today from conflicting reports via Reuters concerning US consumer confidence. Several Reuters outlets reported confidence in the economy at an all time low, while one agency in Hong Kong was reporting the opposite.
Between Reuters, Nielsen, and other key information sources the public should be fairly confused as Google reveals both the up and down of this perplexing situation.
A simple Google News search for stories about business revealed still more bad news with regard to US consumers’ confidence this month. However, further investigation revealed that even Reuters seems confused as to whether people in the US are confident or not.
The top story on the main Google search page in news says; “U.S. consumer confidence up for first time since 2007 – Nielsen”, while other Reuters reports herald near record breaking declines in the Consumer Confidence Indexes. The funny thing is, Reuters seems to be announcing from both ends of the spectrum. Does anyone really know what is going on?
No less than 4 major Reuters stories suggest that US Consumers have lower confidence in the economy now than at nearly any other time in recent history. So how is it possible that a Reuters correspondent on the Hong Kong beat thinks that US consumer opinion is at its best since 2007? Is this just a series of bad typos or something? Or perhaps Reuters is so big now that their own reporters do not even read one another’s stuff? Maybe different outlets are designed for different news? Who knows?
Either Susan Fenton in Hong Kong is using the right metrics from Nielsen in New York, and all the other Reuters news people are asking John Doe on the street, or no one really knows what America’s buying confidence is. According to Fenton’s report global consumer attitudes are improving too. A quote from her report by Nielsen VP James Russo below suggest that Nielsen may in fact use different criteria to measure consumer attitudes:
“While consumer confidence in the United States edged up 4 index points, that hasn’t translated into spending confidence for the vast majority of American consumers.”
Interestingly, Nielsen reports are abundantly positive especially in the Asia sector, as far as reporting world economic recovery are concerned. The report linked to back there, from the Asia Media Journal in Ho Chi Minh City, Vietnam sounds for the world like the crisis is all but over? Back in March Nielsen reported double digit (PDF) drops nearly across the board in consumer opinion about the economy. What changed is my question? Perhaps it has something to do with their using 14,029 online consumers in 28 countries late in June as an indicator of a rise in confidence? I wonder if they factored in the idea that people who still have Internet connections were either more positive than those who lost them, or perhaps were more avid readers of confusing online news like that which we are reading today? This quote supposedly from Nielsen in New York says the worst is over?
“In the United States and Europe, high unemployment continued to discourage spending on big-ticket items although confidence had improved as the worst appeared to be over for those economies.”
One thing that may play a part in understanding these conflicting reports from Nielsen is the way in which the conduct and report their results. In the two images below from their March and July reports, the avid geographer (or anyone who looks at them for even a minute) will note that this 6 percent increase in consumer confidence could easily be due to the fact that according to the maps the US, Southeast Asia, and several other key components of their numbers were left out in the latter. Could leaving off the largest consumer economy in the world effect a positive number? You bet it could. But the bigger question is “why” skew reporting if that is the intent here?
These two reports bear the same title; Global Consumer Confidence, Concerns and Spending”, but the results are obviously skewed and misleading when huge reporting elements are left out (unless of course Nielsen just forgot to color in the United States). The latest report spotlighted by the Reuters Hong Kong article, to be honest, is about has hard to find as a job in Virginia. What appears to be happening with regard to news spreading of this “supposed” upsurge, is that news outlets are regurgitating the Reuters news. I hope someone from Nielsen will forward their latest survey results so that we can go over them. But, in the interim, conflicting reports seem to indicate that Nielsen’s numbers either come from a more deep metric cross section, or they are skewed either purposely or out of happenstance.
Metrics And Common Sense
Claiming that consumer confidence is up or down during these times seems like predicting the outcome of the 1929 World Series in my view. Consumers in the US are pretty much scared to step out the front door these days with all the political shenanigans, Wall Street scandals, and ultimately next door neighbors out of a job. I am a big fan of analyzing data myself, but when Reuters announces “the sky is falling” on one side of the globe, and then announces “gold is falling from the sky” on the other side, anyone should take note. Either Nielsen is hopelessly optimistic (lord knows why), or these other people are the world’s worst pessimists. I cannot go into deeper analysis at the moment as to why the most respected consumer reporting agency in the world might confuse us here, but as anyone knows numbers can be juggled to make 2 + 2 equal 5 (at least on Wall Street). What do you think? Are you willing to spend more this Christmas than last? More to come. Meanwhile, someone send me the latest Nielsen report, I don’t see how anyone found it.