By Nicholas Bender
A survey of 5,000 U.S. households, published Tuesday, revealed that consumer confidence fell for the third consecutive month, raising questions about the role current economic conditions will play in the upcoming presidential elections.
The Conference Board, a New York-based business research organization responsible for the report, bases its monthly figures on a survey that explores consumer opinion about both current economic conditions and future expectations.
Survey findings translate into an economic measure known as the consumer confidence index, a loose rating of consumer optimism. The index sunk from 96.7 in September to 92.8 this month through Oct. 19.
Some economists monitor the index as an indication of the future health of the economy.
'Subdued expectations, as opposed to eroding present-day conditions, were the major cause behind October''s decline in consumer confidence,' said Lynn Franco, director of The Conference Board''s Consumer Research Center, in a press release.
The report comes as voters weigh the economic repercussions of the upcoming presidential election, with each candidate presenting a different plan for the nation.
'Economic performance is always one of the top concerns among voters in any election,' said Ray Christensen, BYU associate professor of political science. 'It would be wrong to assume that the policies that the president and Congress espouse can have no effect . They can.'
But though the report appears to uncover a negative economic trend of consumer-purchasing apprehension, some analysts said they question the relevancy of the index.
Larry Wimmer, BYU professor of economics, said the survey fails to consider actual consumer buying, a more useful measure of consumer optimism.
'Most economists consider the consumer confidence index a fairly minor index,' he said. 'To know what''s really happening, you''ll look at consumer behavior rather than at how consumers feel.'
Charles Biderman, president of TrimTabs, an investment research company based in Santa Rosa, Calif., said the consumer confidence index represents nothing more than consumer perception, which could be distorted.
'My problem with it is it mirrors what the T.V. and the media say,' Biderman said. 'Where are people going to get their information? They mirror what they hear.'
Biderman said high oil prices are likely the cause for any real economic faltering, but added that he thinks the economy is working relatively well despite the supposed decline in consumer confidence.
'The world is not going to hell in a handbasket,' he said. 'The world is not going to end.'