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*                       FIEND'S SUPERBEAR MARKET REPORT                     *

*                                 April 30, 2025                            *

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*                       e-mail: fiendbear@fiendbear.com                     *

*                    web address: http://www.fiendbear.com                  *

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Fiend Commentary

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Consumer Confidence Craters: A Warning Sign Ignored

                                   

In April 2025, U.S. consumer confidence plummeted to its lowest level since May 2020, with the Conference Board's index dropping 7.9 points to 86.0. [1]

More alarmingly, the Expectations Index, which gauges consumers' short-term outlook for income, business, and labor market conditions, fell 12.5 points to 54.4—the lowest since October 2011 and well below the recession threshold of 80. [1]

This decline marks the fifth consecutive monthly drop in consumer sentiment, reflecting growing pessimism about the economy's direction. [1] Notably, 32% of consumers expect fewer jobs in the next six months, a level of concern not seen since the aftermath of the 2008 financial crisis. [2]

While markets may appear stable, with the VIX hovering around 24, this calm belies the underlying anxiety among consumers. The disconnect between market performance and consumer sentiment suggests a fragile economic foundation.

Historically, such sharp declines in consumer confidence have preceded economic downturns. The current sentiment levels mirror those during the early stages of the COVID-19 pandemic and the Great Recession, both periods of significant economic contraction.

Ignoring these warning signs could prove costly. Consumer spending drives approximately 70% of the U.S. economy; sustained pessimism can lead to reduced spending, further slowing economic growth.

Policymakers and investors should heed these signals. Relying solely on market indicators without considering consumer sentiment risks overlooking the brewing storm beneath the surface.

References:

[1] https://www.conference-board.org/topics/consumer-confidence/press/CCI-Apr-2025

[2] https://www.wsj.com/livecoverage/stock-market-today-tariffs-trade-war-04-29-2025/card/consumer-sentiment-plunges-on-tariff-concerns-survey-shows-i3sFE6Bxm0XSERmbPG9v

 


 

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