Greg McBride, senior financial analyst for Bankrate.com, believes that this lack of conviction regarding a sustained economic recovery could become a self-fulfilling prophecy if it also translates into lower consumer spending. With about 70% of GDP tied to consumers he noted, “a hesitant consumer delays recovery in the housing market and the overall economy.”
Bankrate noted from its poll:
- its Financial Security Index fell from 97.3 to 97.0 this month, and that is now the same level as March 2011.
- Readings over the last year have fluctuated between a high of 98.5 in May 2011 and a low point of 92.3 in August 2011.
- Any reading below 100 indicates a lower level of financial security compared with 12 months earlier.
When asked about ‘will the recovery continue throughout 2012?:
- only 13% were very confident
- 37% were somewhat confident – usually those under 30, households with income above $75,000 per year and/or college graduates
- 26% were not too confident, living mostly in rural communities and/or the Northeast U.S.
- and 22% were not at all confident, mostly aged 50 and above, households with income under $50,000 per year, those with a high school education or less, and in the unemployed and/or retirees.