Consumer Confidence Bounces Off a Multi-Decade Low

Consumer confidence actually ticked higher in July, defying expectations for a 7th straight loss. With such a steep drop in June, the rebound in July brings us only part of the way back. Expectations of future conditions improved slightly. The labor market differential continued to decline, we are still looking for a 90K job loss on Friday.

Expectations Improved

• Consumers' assessment of future conditions improved 1.6 points to 43.0. While consumers are clearly still very pessimistic about the economy, perhaps the sharpest drops in expectations are behind us.
• Confidence may have arrested its rapid slide in July, but we are not looking for any near-term improvement.

Labor Market Continues to Weigh on Consumers

• The percent of consumers saying jobs are hard to get rose for the sixth straight month, while the percent of consumers saying jobs are plentiful also fell for the sixth straight month.
• The labor market has been contracting since the beginning of the year weighing both on consumers' wallets and mindsets. We do not see improvement coming in Friday's jobs report.

Wachovia Corporation
http://www.wachovia.com

Disclaimer: The information and opinions herein are for general information use only. Wachovia Corporation and its affiliates, including Wachovia Bank, N.A., do not guarantee their accuracy or completeness, nor does Wachovia Corporation or any of its affiliates, including Wachovia Bank, N.A., assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice, are for general information only and are not intended as an offer or solicitation with respect to the purchase or sales of any security or any foreign exchange transaction, or as personalized investment advice. Securities and foreign exchange transactions are not FDIC-insured, are not bank-guaranteed, and may lose value.