Skip to Content
Investing Specialists

Consumers: Watch What They Do, Not What They Say

Wallets are opening, despite what the consumer confidence reports say.

Mentioned: , , , , , , ,

Despite last week's horrible consumer confidence reports, consumers really opened their wallets in January and February. Data from individual stores and from the International Council of Shopping Centers reported same-store sales growth of 4% and 3.7%, respectively, compared with 2009 results--by far the best numbers of this recovery and far above expectations. More comprehensive consumer data for January from the Commerce Department showed a one-month jump of 0.5% (or almost 6% annualized) for total personal consumption.

The employment data, which I thought would be potentially affected by poor weather, showed little change with job losses of 36,000 compared with 26,000 jobs lost in January on a base of about 130 million jobs. While I think we might have eked a small gain without weather effects, the overall storm damage to the statistics was smaller than I feared. Meanwhile, manufacturing results were a bit more neutral this month as weather and auto issues kept a lid on results that were positive, albeit not as positive as in January.

Real estate data continued showing the usual winter weakness, probably worsened by storms and vanishing homebuyers' credits, as pending existing home sales continued to slide.

Robert Johnson, CFA does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.